Why Use a REALTOR®?

All real estate licensees are not the same. Only real estate licensees who are members of the NATIONAL ASSOCIATION OF REALTORS® are properly called REALTORS®. They proudly display the REALTOR "®" logo on the business card or other marketing and sales literature. REALTORS® are committed to treat all parties to a transaction honestly. REALTORS® subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate. An independent survey reports that 84% of home buyers would use the same REALTOR® again.

Real estate transactions involve one of the biggest financial investments most people experience in their lifetime. Transactions today usually exceed $100,000. If you had a $100,000 income tax problem, would you attempt to deal with it without the help of a CPA? If you had a $100,000 legal question, would you deal with it without the help of an attorney? Considering the small upside cost and the large downside risk, it would be foolish to consider a deal in real estate without the professional assistance of a REALTOR®.

But if you're still not convinced of the value of a REALTOR®, here are a dozen more reasons to use one:

1. Your REALTOR® can help you determine your buying power -- that is, your financial reserves plus your borrowing capacity. If you give a REALTOR® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you. Most lenders -- banks and mortgage companies -- offer limited choices.

2. Your REALTOR® has many resources to assist you in your home search. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.

3. Your REALTOR® can assist you in the selection process by providing objective information about each property. Agents who are REALTORS® have access to a variety of informational resources. REALTORS® can provide local community information on utilities, zoning. schools, etc. There are two things you'll want to know. First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?

4. Your REALTOR® can help you negotiate. There are myriad negotiating factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or equipment. The purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.

5. Your REALTOR® provides due diligence during the evaluation of the property. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few. Your REALTOR® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports. You will also want to see a preliminary report on the title of the property. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations; for example, easements (access rights) for utilities. Your REALTOR®, title company or attorney can help you resolve issues that might cause problems at a later date.

6. Your REALTOR® can help you in understanding different financing options and in identifying qualified lenders.

7. Your REALTOR® can guide you through the closing process and make sure everything flows together smoothly.

8. When selling your home, your REALTOR® can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties. These are key factors in getting your property sold at the best price, quickly and with minimum hassle.

9. Your REALTOR® markets your property to other real estate agents and the public. Often, your REALTOR® can recommend repairs or cosmetic work that will significantly enhance the salability of your property. Your REALTOR® markets your property to other real estate agents and the public. In many markets across the country, over 50% of real estate sales are cooperative sales; that is, a real estate agent other than yours brings in the buyer. Your REALTOR® acts as the marketing coordinator, disbursing information about your property to other real estate agents through a Multiple Listing Service or other cooperative marketing networks, open houses for agents, etc. The REALTOR® Code of Ethics requires REALTORS® to utilize these cooperative relationships when they benefit their clients.

10. Your REALTOR® will know when, where and how to advertise your property. There is a misconception that advertising sells real estate. The NATIONAL ASSOCIATION OF REALTORS® studies show that 82% of real estate sales are the result of agent contacts through previous clients, referrals, friends, family and personal contacts. When a property is marketed with the help of your REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally prescreen and accompany qualified prospects through your property.

11. Your REALTOR® can help you objectively evaluate every buyer's proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing -- a lot of possible pitfalls. Your REALTOR® can help you write a legally binding, win-win agreement that will be more likely to make it through the process.

12. Your REALTOR® can help close the sale of your home. Between the initial sales agreement and closing (or settlement), questions may arise. For example, unexpected repairs are required to obtain financing or a cloud in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your REALTOR® is the best person to objectively help you resolve these issues and move the transaction to closing (or settlement).

This article was republished from the National Association of Realtors website.

Decided to sell, What now?

So, you have decided to sell your home, what do you do now? The conventional wisdom says to hire a real estate agent, but who wants to pay the commission. After all, these real estate agents are overcharging commissions and anyone can do their job; even you. Am I right?

So, now that you have decided to sell by yourself, what is the next step? First, you will want to get a yard sign so your neighbors will know that you are selling your home. 51% of all For Sale By Owners use yard signs. You can go to the local Home Depot or Lowes Hardware to get these signs for next to nothing. You place the sign and wait for the phone calls to come. You are now selling your home and there is no turning back, am I right?

But wait, there is more to do. What will you price your home? Your neighbor down the street tells you that they got a certain price for their home, so you think you can at least get that if not 10-15% more. After all, your home is much better and you paid more for it. So, you have the price and the sign, time to advertise. BUT WHERE DO YOU ADVERTISE?

Conventional wisdom again tells you that you need to advertise in the local newspaper. After all, 31% of all For Sale By Owners advertise in newspapers and 55% of home buyers use the newspaper to find a home. So, you have this in place, what now?

The next step is to schedule your first Open House. How exciting(not if you have done as many as I have)? 29% of For Sale By Owners conduct open houses on their home. Even though only 1/2 of 1% of homes sell via a open house, it sounds exciting and like something that will definitely sell your home. After all, you have seen those TV shows where 3 offers came in after a single open house, right? This must be the perfect way to sell your home. Not really and not in this market.

Finally, you decide to list your home on the Internet to sell it. You advertise on Craig's List, E-bay, and even design your own website for your home, yet it still doesn't sell. What is wrong with this picture?

Did you know, that around 80% of all For Sale By Owners will list with an agent for one reason of another. The 2 most difficult task for For Sale By Owners according to NAR is Preparing the home/fixing it up for sale (18%) and Understanding the paperwork (11%). Finding a buyer and having enough time to devote to the sales process come in the next 2 spots with each 9% each.

What does all this mean? It means that selling a home is more complicated than simply placing a sign in your yard. With technology the way it is, it is nearly impossible to get your home marketed in a way that will gain maximum exposure. I know you are asking yourself that you don't need maximum exposure, just 1 buyer. This is very true, but the more interest you have in your home, the more money you will get for it. It is as simple as supply and demand. The more demand for a product(your home); the greater the supply(price) for your home.

In conclusion, it is a known fact that at least 90% of all homes sold are due to a real estate agent. So, that means that fewer than 10% of all homes sold are due to a For Sale By Owner. Additionally, the most popular website for real estate search is Realtor.com, where 82% of home buyers use this site more than any other site. So, it just begs the answer that Realtors get the most money for your home than you could on your own. In fact, NAR reported that the typical For Sale By Owner home sold for $187,200 compared to $247,000 for agent-assisted home sales. If you do the math, that is 16% more with an agent and thus, you are not saving the commission of 6-7%, but rather losing 9-10% of money you could have earned on your home. In addition, as the market continues to tighten up, it is going to make it even more difficult to sell by yourself since most buyers who look at For Sale By Owners are looking for a great deal. The figures speak for themselves that this is where the good deals can be found. Can you not afford to use an agent?