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What’s Your Real Estate Agent Not Telling You?

19 May 2013

Your real estate agent is the one who guide you in your home purchasing or home selling process. They’re going to be your advocate, your protector, and work really hard to get you the best home for the best price. Right? Well in most cases that’s true, and wandering into the real estate waters without one can be very hazardous to your financial, and maybe even your legal, health. But sometimes you get a real estate agent that is just as worried about themselves as they are you. And when that’s your story, there may be a few things your agent isn’t telling you. Here are the biggest five that they sometimes try to get away with.

They can negotiate commission

Commissions can become tricky because so many agents charge them using so many different ways. Some will take a percentage of the home’s price, while others will take a flat fee. Some will charge more if they’re performing services that are over and above that of an average agent. The important thing is that you know the percentage you see is not locked in stone.

Agreements cover any purchases made within that time frame

Some buyers think that if they strike it out on their own and find the home of their dreams without the help of their real estate agent, they’re off the hook for the commission. They’re not. If you have an agreement with a real estate agent then you will be responsible for paying commissions to them whether or not they have anything to do with your final deal. Know that when you’re drawing up the agreement with the agent initially, you can include exclusions from commission, such as if you wander into a builder’s sale centre on your own and purchase a condo unit from them. Also know that if you choose to do so, you may end up getting the raw end of the deal anyway. A real estate agent can be valuable even when choosing among “cookie cutter” condo unit layouts by helping you choose finishes and features that will help you with the resale later.

Only certain types of open houses benefit the seller

Open houses that are open to the public will attract buyers that are actually interested in buying your home, tire kickers that are just looking to wile away a weekend, and buyers that are looking for a home – just not yours. All of these are potential clients for your real estate agent, but most of them won’t bring you any benefit. In addition to that, you run the risk of losing some of your valuables if some people with some not-so-great intentions see an open house as an open opportunity into your home.

The only kind of open houses that will benefit you the most, and with no risk of losing your belongings, are agent open houses. These are open only to real estate agents, and those agents will probably come with one (or a few) of their clients in mind – clients that they know will actually be interested in your home. Once they view your home they’ll go back to their client and tell them about it, and then set up a private showing time.

Real estate isn’t the right investment for everybody

If you want to buy a home and can afford to carry the monthly mortgage costs, the property taxes, and all the costs of home ownership, investing in a home that you’re going to live in for the next several years is probably a good investment. If you can barely afford the mortgage, let alone all the other costs, then it’s most likely not. Some real estate agents know that buying a home is going to stretch their client to their financial limit, but they keep quiet because they’ll make the commission regardless. Others on the other hand, will try to steer you towards properties that are closer to your price range, and this makes more sense. If you’re not approved for that mortgage after all, they’re not going to get that commission.

If you’re purchasing property for investment purposes, the chances that your real estate agent is going to be of any help in the return department is even less likely. And it might not even be their fault, they might simply not know. But remember that any investment must also be able to carry the costs, including taxes, insurance, utilities and possibly a large down payment. And in addition to all of that, you still need to be able to bring in a return. After all, owning an investment property really does you no good if you’re still just breaking even.

Professional staging is unecessary

Real estate agents, in an attempt to sell a home as quickly as possible and make their commission, will talk their clients into spending big money on professional stagers. These professionals will come in and set up pricey furniture, put up a new coat of paint, and maybe even tear out a countertop and put a new one in its place. All of this is unnecessary, and some are even things you can do yourself for free. Instead of hiring professionals, declutter your home, tidy up, and ensure that your home looks as attractive as possible to potential buyers.

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