Ask anyone, especially if you’re new to the world of real estate – buying and selling a home is often a painstaking, time-consuming and emotional journey – one that’s worth it when you finally have the keys to your dream home in hand.
It’s much harder to achieve that dream without the help and guidance of a professional, which is why it’s vital to have a real estate agent in your corner. As a licensed professional, often with years of experience, an agent plays an essential role in facilitating a property transaction between a buyer and seller, keeping consumers safe and oftentimes heading off potential problems before they come up.
READ ALSO: 5 Arizona housing market predictions for 2021
What If I want to sell or buy a home on my own?
While it may seem flying solo beats paying an agent a commission, more often than not, the costs can pile up in the end. Think to yourself; with everything I have going on, can I research the market, learn and understand local real estate laws, market my home and screen buyers effectively? If you already work a full-time job, chances are you won’t have the bandwidth to take on another one. Beyond that, you don’t know what you don’t know and there are pitfalls through the process that you may unwittingly be walking into.
Most agents tend not to show For Sale By Owner (FSBO) listings. There are hassles and risks involved with closing deals where there aren’t licensed professionals representing either party. Time is money and agents prefer to do business with other professionals who are skilled in the balancing act of strategy and efficiency while they each represent their clients in good faith. Even if an agent will bring a buyer to a FSBO listing, sellers are instantly at a tactical, strategic and informational disadvantage against the seasoned agent.
Why You Need a Real Estate Agent
Buying or selling a home is one of the largest financial transactions you’ll make, so it’s better to leave it to a professional so it goes smoothly. Here are six reasons why working with a real estate agent is worth it:
1. Local Housing Market Expert
The more experienced an agent is, the more expertise they’ll have on local property market trends, competitive listing prices and what makes for attractive offers. They’ll spend time every day researching active and pending listings so they’re always on top of what’s available.
An agent relies on their experience and skills to sell or list properties at the best price with the most favorable terms. An agent will invest time working with their client, discussing and understanding their needs, and knowing the ins and outs of the housing market to get them what they want.
2. Minimizes Legal and Other Risks
There’s a lot of legal paperwork involved with painstaking nuances that a realtor has experience dealing with. Agents are knowledgeable about local real estate laws, saving you the time and research you’d have to do on your own. An agent will guide you through the legal process to ensure you don’t violate any local real estate laws in selling your home.
Beyond the legal process, agents will help you minimize the other risks associated with buying or selling a home: financing risks, appraisal risks, inspection risks, and dozens of other risks pop up with each purchase or sale and well-seasoned agents know how to deal with them or have connections with who can.
3. Valuable Connections
Agents have access to multiple listing services and over time, they’ve built an extensive network with other realtors. The connections and relationships they’ve built during their career can get more eyes on your home. These are valuable resources that otherwise wouldn’t be available without an agent.
Agents also build a deep network of trusted professionals that they’ve come to rely on over the years. These professionals include lenders, inspectors, tradesmen (roofers, plumbers, etc.), attorneys, architects, accounting professionals, and many others you may need to consult during the process.
4. Neighborhood Expert
Nobody knows the best places to live, eat and play like a real estate agent does. Based on your preferences, they can recommend the best geographic areas and neighborhoods to live in. You can pick their brain about where the excellent schools are, what crime rates are like, how they see the neighborhood changing in the next decade, and so on. When it comes to specific demographic information, agents are limited in what they can directly share because of Fair Housing laws, but they can provide you with resources for all of that information. While we’re on the topic, if you’re considering a move to Phoenix or already live here and want to move to another neighborhood, check out our recommendations on the best places to live in the Phoenix metro area.
5. Professional Home Marketing
An agent will take time to research the local housing market and neighborhood trends to establish a competitive asking price. They’ll use attractive keywords to list your property, prepare advertising collateral, stage your home, coordinate showings, and many will hire a photographer at no cost to you to take beautiful photos and videos of your home to blast on listing sites and social media.
6. Superior Negotiating Skills
Experienced realtors are expert negotiators and work hard on your behalf to ensure you’re getting the best deal that matches or exceeds your goals. As mentioned before, time is money and agents can identify and weed out unqualified buyers such as dreamers or curious neighbors who slow down the process. An agent will move past the noise and maximize time with people who are serious about buying your home.
What You Can Expect to Spend on a Real Estate Agent
The closing process can be a bit confusing, which is why it’s important to have an experienced agent lead you through sealing the deal.
Commission Costs
The seller (not the buyer) pays a commission to their real estate agent at the time of closing.
Closing costs can range slightly but the amount is typically 6% of the final sale price. Typically, this fee is broken up evenly between the selling and buying broker.
For example, if a home sold for $500,000, the seller would pay $30,000 in total commissions to both brokerages.
Closing Costs
In the state of Arizona, both buyers and sellers can expect to pay closing costs, though the seller usually pays a significantly higher amount due to commissions. Closing costs cover several property transaction fees and expenses that include the appraisal, credit report, legal fees, government processing fees, title insurance, escrow fees, lender costs, processing and underwriting fees, as well as prepaid property taxes and insurance.
The average closing cost in Arizona for a seller is 1% of the final home price. So, if we stick with the previous example of selling a $500,000 home, 1% in closing costs means the seller covers most of the $5,000. Buyer closing costs, especially when financing the purchase tend to be between 1.5% and 3% of the purchase price.
Trevor H. Halpern, J.D. is the #1 independent agent at Phoenix-based North&Co. and the founder of the Halpern Residential real estate group. As a Phoenix native, Halpern’s deep knowledge of both people and property has allowed him to create client success in all areas of town. As a graduate of ASU’s College of Law, Halpern prides himself on delivering high-level strategy, efficient negotiations and precise tactical execution. Since 2011, Halpern has sold over $100 million in real estate and has been in the top 1% of real estate agents in the Greater Phoenix Metropolitan Area since 2016.
