What else do estate agents do?
1: Take bookings and show people around your property.
2: Advertise your property.
3: Inform you of any bids made on your property.
Is that it? How do they justify charging so much?
Answer:
It depends on what type of agency you hire, but most of the full service ones really do a lot of work behind the scenes. The "charge" is normally split in half between your agent, and the agent who brings a buyer. If your agent does both, they get the full commission. They do a lot of negotiating between the parties, make sure the home inspections, (ie: termite, asbestos etc.) are taken care of and on schedule, they make sure all of the financing is good to go so there are no problems at the closing table, plus the extensive advertising and marketing needed to attract the buyer. Some agents do more than others, but that depends on their personality and work ethic, and ethics in general.
Some might say that is what they do.
Others simply tell the truth.
Thats what it looks like from the outside. Now look at it this way, number one if they take your listing at 6% this is what happens.
First they give 3% to a cooperating agent. So lets use numbers ok. lets say its a 6,000.00 commission, 3000.00 goes to the other agent, then a split goes to your agents broker. Usually about 30-40%. so we will say 900.00 goes to the brokerage. now your agent is down to 2100.00. Then lets say that they pay for a virtual tour. 300.00 now we are down to 1800.00. Then they usually spend at least 5-10 times driving to show the property. how about 100.00 in gas. 1700.00 now. A sign for your property 50.00 1650.00 now. Agents have to pay yearly dues of about 1000.00 and they have to buy a keybox for the property. 350.00 between those two. 1300.00 now, need i say more? It takes a person selling a whole buch of properties to make a living in the business. Look at the turnover rates in the real estate business, its startling!!
In my experience the estate agents I have dealt with have done sweet f all for their money.
They never phone when they say they will. Everything is always someone elses fault & once they have a sale they couldnt give a crap about after sales services.
i had to show people around my house as the estate agents were always "too busy"
Even when viewing houses I was never shown round by the estate agent, always the owner.
Im sure most of them must sit around at their desks all day trying to look busy.
Lie and lie some more
Not at all, my mate is an Estate Agent, he also plays golf at weekends and has recently undertaken Salsa classes..
A real estate agent is your liaison/protector. If we are listing your home, we are the listing agent and owe a fiduciary duty to you to present all offers and work in your behalf looking out for your best interest. A good agent does her/his best to make the transaction go as smoothly as possible. Advertising costs money, gas, time.all of those things figure into what is charged. Also if another agent finds a buyer for your property the commission is then cut in half. Subtract the brokers fee and it really doesn't come out to be all that much.and remember, you get what you pay for.Hope that helps.
Because they have overheads like any other business and one needs a "go between with experience" doing a professional job to represent their client. Having said all that they do it for money and like everyone else the more they can earn the more they like it !
Order termite inspections
Coordinate the inspections
Verify information
Offer Guidance and advice
review paperwork to ensure compliance with all laws.
They charge a percentage of value so this rate has gone up in line with prices which is robbery for what they do. A couple I know refused to pay £1800 and offered a one off payment of £1000 take it or leave it. Guess what? They took it.
First, say you list for 6%.
Half this goes to the selling office (aka buyer's agent)
So now your agent gets 3%.
Now he/she splits that with her broker.she makes more like half to 60% of that.
So on a $200K house, she is getting 1.5%, which equals $3,000, minus taxes.
But in order to be an agent, she/he invests HUNDREDS in Licensing fees, classes, REALTOR association fees, insurances, taxes, etc. She also must do all those things you just listed-- WITHOUT a guarentee she'll make a dime-- she can invest hundreds in YOUR property only to have you decide not to sell.
They also dont just ":inform" you of bids-- they walk you through ten to thirty pages and discuss EVERY nuance of the offer.
There are good ones and bad ones.
the good ones market properly vet potential buyers keep sellers informed tell the truth at all times accompany buyers on viewings at anytime of the day or any day of the week, will work with the seller re different sttrategies etc etc etc.
the bad ones
tell you anything to get a property on their books, advertise it in the paper shop window or text people registered with them and ..wait for the phone to ring. When it doesnt instead of chaning tack they simply say lets try reducing the price.
In any other sales profession reducing the price is the last step not in estates agents wrold sadly.
A suggestion: Try selling your house yourself & you will soon appreciate that there are a number of time consuming & costaly tasks involved here. Now don't think I feel sorry for the poor guys earning the big bucks out there but they put in more effort than you think. Maybe 15-20 visits per sale, numerous ads in papers, internet, getting all the details together, putting up a board. Some houses just hang around & don't sell. Other clients just take their business elsewhere so you don't recover their costs. Question is if you were setting up an estate agency business could you make a decent profit by charging less?
In the UK they do the following:
Send somebody round to give you a free valuation
Come back out if you decide to go on the market with them to take photos, rooms sizes and features
Have a secretary type up your details
Send them to the Printers for some nice brochures
Put a sign up near your property for buyers looking to buy into the area
Advertise your property in their window, on numerous property websites and roughly bi-weekly in the local newspaper
Mailshot everyone on their database who has registered as looking for a property likes yours
Show potential buyers your property details when they phone/email or come into the shop
Arrange viewings for potential buyers and take them round
Negotiate any offers that come in
Chase your solicitors once a week once to find out the progress of your sale for you
Offer advice on homebuyers reports, legalities and can set you up with a reputable mortgage advisors and solicitors
Where I used to work they charged 1% commission, which I didn't think was too bad, considering the cost of staff, advertising, brochures etc.
In the UK they don't do anything much and most of what they do has an element of dishonesty about it.
We negotiate your sale, use our knowledge to value your property accuratly, Advertise your property ( which isnt cheap ) , produce a brouchure, take photos, draw floor plans, Contact applicants on our data base's, identify potential buyers. Check finacial staus of potential buyers, call solicitors and help progress the sale, Hold the keys and accompany viewings, Arrange for surveyors to go round. Verify ID status for money laundering act.
It show how little you know!!
We are here to sell the biggest asset that you own and you windge about paying for our service's
We have to deal with angry, upset, mad , nasty , obnoxius people on a dayly basis.
If you think it is so easy try selling your house yourself. then ask yourself did you get the maximium for it, did you undervalue it?
Have fun.
In addition, a good estate agent will co-ordinate the sale process efficiently from begining to end. This will involve keeping in regular contact with the buyer, seller, buyers solicitors, sellers solicitors and also any other estate agents who are part of the chain (e.g. if a person selling through one estate agent had a buyer who was selling a property through a different estate agent).
The estate agent also advise buyers and sellers of what they need to do, and will also value a property by using their expert knowledge of prices in that area. Okay, there are some dodgy estate agents who manipulate things to their advantage, but I'm talking in terms of a decent honest estate agent. To a certain degree, you are also paying for their expertise.
A good estate agent will vet potential buyers. Show them around your home, give you advice when it comes to accepting any offers. For them to advertise in the local papers is expensive and they take that risk that the house might not sell or that you will change your mind. I would not pay more than 1.5% to one. Always haggle with the fee.
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