Real Estate FAQs
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Whether you are an old hand at selling or buying real estate, your are buying in a new location, or you are looking to purchase your first home you probably have some or even many questions.
This is the place to look for answers and the place to ask questions. Our top local real estate professionals are happy to answer questions for you and we will post the questions and answers right here at the Home of Napa Valley - Sonoma Real Estate - NapaYellowPages.com , where we meet your needs and help our advertisers succeed in meeting them as well.
1. How do I find the right Agent to represent me?
This is one of the most frequently asked questions in real estate and a somewhat difficult on to answer.
Let's start by looking at the way people "normally" choose agents and work from there.
Often a person wishing to sell a property or buy one will take several avenues to find an agent to sell there home, land, vineyard or what not or to purchase property being sold by others in the area they desire to live in. I almost said find an agent to "represent their interest" but often that has nothing to do with their decision so I avoided that turn of the phrase.
If they live in the area where they want to
sell their property many people ask a friend, relative or associate about
who they should use as an agent. Who sold your home Joe? Then they ask,
The way buyers generally find property is to look for a property they like whether it be by driving around, looking on the Internet, or reading ads in the paper. This is a good step in finding a property but, what follows after words is not necessarily the best next step. Many people then contact the selling agent to find out about the property and if they are interested start working with the sellers representative to purchase that property. This could be a very big pitfall and a costly decision for the the buyer.
There are also other ways for both buyers and sellers to find a representative. I seller may contact an agent to sell a property because they received a post card saying that the house next door was sold by Ms. Vineyard E. Land. A buyer may talk to a guy at the restaurant who told him that Joe Property was a great agent. I can go on but those of you who have used real estate agents with success or without it will probably remember your experience.
As I said above these "normal" methods are a good start to finding an agent but not a way to reach a decision.
Why? Because one should not fail to remember that it was Joe who recommended the "went out of business because he poisoned his patrons restaurant." He loved but, you really didn't like it that much. His opinion, as an end result, was different then yours obviously. Your friend, the seller, may have had a great agent but he could also have had a great buyer, a great buyers agent, or just great timing. He really doesn't care because he feel he got a great deal because his property was SOLD!
The are many horror stories out the however where sellers choose the wrong agent, got the wrong advise, and lost lots of money on the deal. Here are 2 simple and quick examples of things going wrong.
Seller A had a rental home for sale in a buyers market because he needed to get out from under it. He hired an agent that seemed to be exactly what he needed and appeared to have good references. He dealt with buyers who were looking for that type of property.
This seller lost 27,000 on his sale. Why? The sellers got misinformed by an agent who normally represented buyers and felt his job was to get the "buyer" the best deal he could. The agent gave the seller sale prices for comparable properties that sold in the area and told him he should expect to get X number of dollars for the property. The seller already knew that prices were low in the market and was ready to give some to get some.
He sold the home in a few weeks for 35,000 less than he expected but accepted this because as we said he needed to get rid of the property and the comps showed about what the property was worth.
How did he loose 27,000? First the comps were not accurate. His property had more improvements than other properties his home was compared to, a larger lot and so forth. Second he used and agent who as it turned out was a buyers agent. He low balled the price the buyer was willing to pay and then sold the seller on the price. This is a case of seller beware. When you hire an agent to sell your property he or she should be representing you not the buyer. Real the contact and you will see that the selling agent has that responsibility to the seller. Technically, the sellers agent should not be bringing buyers to you - if he or she does your interest "may" secondary to the agents interests.
Another example is a seller that sold a apartment building with 12 units which normally is a simple proposition based on the amount of rents per year time a number of years. Normally this works well. This seller 12 units brought in approximately 9000 per year per unit. $9000 x 12units x 8 years = 864,000 was the set selling price of the property. It sold for 799,000. In actual fact this seller never should have sold the property at that time or should have sold it for more with consideration to the buyers for the period of time it took to raise the rent to normal. Comparable buildings in this area were getting rents of 12000 per year and using the same system as above this building should have sold for 1,152,000 and would have had the kind hearted owner raised the rents to normal before her sold or sold it to a new owner for say 1,000,000 with the understanding that it would take a little time to get the rents up to where they should be.
What went wrong? The owner got a recommendation to this agent with good references but it turned out this agent normally sold homes and knew little about apartment building or other investment properties. The seller lost 200,000 dollars. The agent was not aware of the what this building was really worth because he did not have the experience needed to sell this property.
These seller and this buyer all used standard and normal methods of finding agents. In other words it's what most everyone does. Often things work out Ok in real estate even with these methods. Sometimes, as these examples show this can become disastrous.
So how do you choose an agent.
Sellers - 1. Yes, go ahead and ask your friends, relatives and associates and get referrals and recommendations. 2. find an agent with expertise in the type of property you want to sell. If you are selling horse property get an agent who has experience with selling horse properties not one that specializes in selling mid-range homes to first time buyers. If you are selling a multi-million dollar estate find agents that have sold and currently sell estates successfully.
Preferably, find several local, experienced agents that handle your type of property, in your area-- that is county, city or even area of the city depending on the size and population of the area. Use several sources to find these agent. Once you have found 3 or 4 you think you might want to talk to make a phone or in person appointment with these agents and start asking questions. Find out their quantifications. What they can really do for you based on experience, knowledge, background, their personality, and past sales of your type of property and get some references as well. If you are a seller find out if the agent can be as aggressive you you need her or him to be with your property. Can they get you the price you have agreed the property should sell for. Can they get a buyer within the time frame you agreed on. If you are a seller make sure the are representing you as a sellers agent and have fiduciary responsibility to you and realize what that means. An agent that lists your property has the responsibility to see that your rights are protected 100 percent and to do every thing in her or his power to assure that al the agreement between you and the agent are met.
I once sold a piece of property where I called in the agent that sold me that property. I told him. I wanted to what I wanted to sell the property for (I knew what it was worth) and how soon I wanted it sold. The price was 5% over market and I told him I wanted it sold in 2 weeks. He gulped, thought about it, said he could do it and we sighed a 2 week contract. 12 days later the house was sold for the price I asked. He also handed me 3 other offers for less which he said he rejected per my request and didn't even show me. There is no doubt in my mind that this agent was working for me. If you ever get a recommendation of this kind from anyone, you should talk seriously to the agent.
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