Buying a home is one of the biggest financial investments most Americans will ever make in their lives. Likewise, selling a property without any hitches is equally important when it comes to a family or individual’s long-term financial health.
Whether you are selling or buying a home, you might naturally consider hiring the services of a real estate agent, or you may decide that you want to go it alone without representation.
Knowing whether you need a real estate agent is a decision which needs to be weighed on a case-by-case basis. There are some cases which would require the professional help of a seasoned realtor, such as buying commercial property, purchasing straight from a developer or buying a very expensive property.
However, there are situations where you may be able to get away with not using a real estate agent. If you intend to buy property from or sell your home to a close friend or family member, for instance, you may be able to forego the realtors and negotiate the sale yourselves.
So how do you decide when to use a real estate agent and when to buy, sell or rent on your own? Read on to learn about a few of the pros and cons of using a real estate agent.
1. Real Estate Agents Bring Expertise
One of the main reasons why home buyers and sellers work with real estate agents is because they lack expertise in real estate matters. One of the benefits of being a real estate agent is that such experts learn specifics about location, market trends, home inspections and many other factors.
As a layman, you may be overwhelmed by everything from the terminology involved in a real estate transaction to the multi-step process and even the paperwork these transactions usually involve. This is where a real estate agent comes in handy. These individuals are licensed and trained on how to handle everything from the most basic to the most involved home sales processes.
2. Agents Help You Negotiate
One of the most frustrating phases of selling or buying property is the negotiation process. Depending on the parties involved, this may be a lengthy and time-consuming process. Part of the reason is that it can be difficult for the average person to accurately assess how much a home is really worth.
Not only does hiring the services of a real estate agent save you time, but it also saves you from dealing with the “back and forth” involved in the negotiating process. As seasoned negotiators, realtors know how to represent you and your stand better than you would probably do.
3. Realtors Help Level the Playing Field
If you are thinking of buying a home, chances are the seller already has a real estate agent working on their behalf. In order to level the playing field, you may also consider hiring an agent to represent you better.
This is especially true if you are buying property for the first time. Many new homebuyers find the entire process more complicated, partly because they have no prior experience.
While it is not entirely impossible to successfully negotiate a deal as a first-time homebuyer without a real estate agent, there are definitely many benefits to having someone on your team who can help you understand what to expect. Additionally, some sellers even demand that their potential buyers have a real estate agent.
4. Real Estate Agents Have Access to Market Information
One of the perks of being a real estate agent is that these professionals have information at their fingertips. Whether it is information on the best locations to buy your next property or the best rates to sell your home, they constantly keep abreast with market conditions. This is information that you may lack as a layman and which may come in handy when you want to buy or sell your property. Using a realtor can help you take advantage of this wealth of information for your own good.
5. Your Agent Will Take Care of Your Due Diligence
Real estate agents are also beneficial because they are knowledgeable in carrying out due diligence. This is especially important for anyone looking to buy a house. Your real estate agent will ensure that as much information as possible about the house you intend to buy is dug up. They can also help you find a professional to conduct a home inspection before you buy or sell your property.
6. Realtors Are Expensive
One of the main setbacks when it comes to using realtor services is that they can be very expensive. Most homeowners prefer to go solo when buying or selling their homes so as to cut down on costs. If you are a savvy (and experienced) buyer or seller, you may skip a real estate agent’s services.
Some buyers find it cheaper to not use a real estate agent because they end up negotiating lower sale prices and save costs by only paying for the services of one real estate agent to represent both parties or none at all.
7. Some People Want Direct Communication
While there are realtor benefits when it comes to negotiating sale prices, some homeowners find the “back and forth” communication through an intermediary exhausting and ineffective.
Direct connection between a buyer and seller has its benefits. For example, you can make your own unique needs known to the other party without the risk of any information being accidentally distorted by a middleman. Appealing to the other party’s interests and needs may also make the negotiation process less rigid and impersonal, earning you a better deal and possibly even a lasting relationship for future business.
Whether you want to buy a home or sell one, you need to make a decision about whether or not it makes sense to hire the services of a real estate agent. Weighing real estate advantages over the disadvantages of hiring a professional to walk you through the process is a hard one to make.
If you have bought or sold multiple homes before, you may feel more confident walking this path alone. If you have a real estate lawyer by your side, opting out of realtor services may also be an easy decision depending on your experience level or the particularities of your situation. However, if you do not have any experience or lack expertise in matters of real estate, you are better off hiring the services of a reputable real estate agent to avoid any loopholes and horror stories.