How to Choose the Right Real Estate Agent in an Uncertain Market
Over the past two years, the real estate market has been nothing short of a rollercoaster – from escalating bidding wars and nonstop competition to a sudden slowdown.
As buyers venture back into the market, sellers might also be ready to list their homes.
With so much uncertainty in the market, finding the right real estate agent is more important than ever. So, how do you ensure you’re working with a great agent? Patrick Ryan from Genuine RE shared his insights with Leverage.
Interview More Than One Agent
In addition to doing your own research, I recommend talking with two to three agents. Here’s how I would segment your interviews to ensure you interview a wide range of agents:
Local Expert: Find an expert in your area and have a conversation about their experience.
Top-Producing Agent: Talk with a top-producing agent outside your area/neighborhood. While this might seem counter-intuitive, they could bring a fresh perspective to the transaction and a strong background in marketing, sales, and negotiation.
Personal Connection: This person could be a personal connection or an agent you know through your network or neighborhood.
Ask the Right Questions Upfront
When interviewing a potential agent, don’t be afraid to ask questions. They are going to guide you through one of life's most significant financial transactions – you need to make sure they’re qualified to handle it.
Here are some baseline questions I recommend:
What marketing technology and resources do you have?
Have you worked in a challenging market?
Choosing an agent without shifting market knowledge means there could be a learning curve at the seller’s expense.
Will the agent you’re meeting with in the listing appointment be your main point of contact?
Which agent will be communicating with buyers and showing the property?
See Your Home From a Buyer’s Point of View
As agents, we know you have an emotional connection to your home. However, we also know what it will take to sell the property. Therefore, when we discuss the listing price and marketing plan with you, try to remove the emotional component and consider the home from a buyer’s perspective. Your agent can offer impartial, constructive advice on presenting your home in the best possible light.
What bothers me about the home? (It will very likely bother potential buyers, too).
Does the house need cosmetic updates or repairs?
What can be fixed/addressed before the home is on the market? (Common recommendations include painting, power washing, decluttering, etc. – many agents suggest spending 1-2% of the expected sales price on these items).
Don’t forget that in this day and age, a wealth of information is available to potential buyers, from how many times a seller has changed agents to how many times the home price has dropped. Buyers use this information to create their narrative about the property, for better or worse.
Price the Property for the Current Market
Many sellers think their home will sell for the same amount today that it would have a year ago, and that’s simply not the case. Maybe their neighbor or friend sold their house at the height of home prices, and they assume they’ll get the same price, but the market is vastly different today.
Low mortgage rates fueled a hot market, driving home prices to historic highs. With today’s higher mortgage rates, we’re seeing softening sale prices. Rising interest rates have priced some buyers out of the market since their purchasing power is diminished.
It’s important to remember that every property and price point is affected differently. Sellers need to consider the market from the buyer’s perspective when considering pricing. Last year at this time, the monthly mortgage payment on a $300,000 home could have been around $1,250 (without taxes on a 30-year, fixed-rate mortgage). Today, the payment would be closer to $2,000. That 60% jump in a buyer’s monthly housing cost has a major impact on the market.
The domino effect of rising interest rates means that if buyers can’t afford to buy, many sellers aren’t able to sell. However, sellers who can buy in cash or have a large down payment might not feel the effects of today’s market.
Bottom line – trust your agent on pricing. Working with the right agent means leveraging their expertise and industry knowledge to ensure your home is priced to sell for the current market, not last year’s.
The Right Agent Can Make or Break Your Deal
Today’s volatile market underscores the importance of hiring a real estate agent with the knowledge, expertise, and marketing skills to help you navigate the sale or purchase of a home.
When you take the time at the beginning of the process to find an agent who is your partner, collaborator, and advocate for the duration of the transaction, you’ll set yourself up for success. As we look ahead to an uncertain 2023, it’s now more important than ever to carefully select your agent.
Patrick Ryan is the Owner and Managing Broker of Genuine RE in Chicago, Illinois. He has nearly two decades of experience in real estate and is an award-winning residential real estate consultant with a track record of sustained success.