Want in on a big secret? Your Realtor should educate you about current market value, writes columnist Amit Paul.
With what I’m about to write, some people might worry that I could could lose my Realtorship.
OK, so this may not be as sensitive information as the CIA is forced to keep under wraps, but rest assured that there are some agents out there, in spite of the good ones, that might have hoped this information never reached their clients.
The truth is that a Realtor’s job extends far beyond showing you prospects — or your home to buyer prospects — and negotiating a price. Imagine buyer Veronica is searching for a home with Realtor Bob. To begin, Bob should help Veronica outline her wants and needs and also establish her price comfort zone. Veronica should be aware, right off the bat, how much the homes she’s looking at will cost her to carry each month, via mortgage. If Veronica is going to see homes blindly, Realtor Bob has already failed to do his job as best he can.
Let’s assume Veronica is prepared and she decides upon a house. She asks Bob what the price of the home she likes, listed at $449,000, is really worth. Bob tells her that it’s listed very close to market value and so Veronica and the seller settle at $445,000. Now whether Bob is being honest or not is one thing, but the fact that Veronica was never educated, or at least given the option to be educated, is of most concern.
In actuality, Veronica should have been advised by Bob to begin reviewing the area thoroughly, with his help and through property listing updates. This would help Veronica establish an understanding of the market. The reality of today’s marketplace is that the best deals vanish in a matter of days. That means the hottest properties have offers waiting instantaneously, sometimes sight unseen. If Veronica hasn’t been educated on the market, she is in no position to act quickly, which means these best deals are not even on her radar.
Finally, if Bob had given Veronica comparables to look at before she made that offer of $445,000, she would have been in a better position to make an informed decision rather than going in blind. For example, if the comparables showed that while homes sold around the $445,000 mark but took an average of 30 days to sell, and this home had been on the market only a week, Veronica would have done better to begin at a lower price.
There are a number of different scenarios in which comparables and proper analysis can play a helping role. The point isn’t that data and facts make it harder for Bob to lie. If he’s lying, he’ll get weeded out sooner or later by today’s intelligent and informed consumers. The point is that Bob owes Veronica a level of effort, dedication and commitment that cannot be captured in showing a few homes and signing an offer. Too many people believe that their Realtor is simply their key in the door.
I believe your Realtor should be your guide and your teacher in every facet of real estate that affects you.
For more information, or questions and comments feel free to e-mail Amit at amitp@rogers.com.
