When hiring an agent, you don’t get what you pay for

Real Estate Agent
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When hiring an agent, you don’t get what you pay for

James McGovern
Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes

Listing agents who charge more don't often provide a better outcome compared to agents who have rock bottom listing fees. Agents will sell based on creating an emotional connection and not a guaranteed better outcome. They will pitch the level of effort but not commit to delivering anything better than a low cost agent will

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Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
1y

I think you have good agents and bad agents...it doesn't always correspond to what they charge or how long they've been doing this.

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    1y

    really ?   and a woefully inaccurate statement.  there are No guarantees in RE.

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Jay Hinrichs if there are no guarantees does that not suggest that paying more for an agent doesn't guarantee you will receive more 

      0Reply
  • Scott Nachitilo
    Property Manager · OK · Member since 2024 · 98 posts · 74 votes
    1y

    You’re paying for competence, not charisma. The best agents prove their value before you sign.

    1Reply
    • Joe S.Pro Member
      Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
      1y
      Quote from @Scott Nachitilo:

      You’re paying for competence, not charisma. The best agents prove their value before you sign.


       And how would they prove their value before you sign?

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Scott Nachitilo how should an agent prove their value before signing?

      0Reply
    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Scott Nachitilo what is the floor for competence?

      0Reply
    • Eric FernwoodBusiness Member
      Realtor · Las Vegas, NV · Member since 2014 · 993 posts · 1k+ votes
      1y
      Quote from @James McGovern:

      @Scott Nachitilo how should an agent prove their value before signing?

      When listing a property, an agent should provide three key elements: their estimated sale price with a clear explanation of how they determined it (and it must make sense); a detailed strategy for achieving that price in the shortest time possible; and performance data from their 10–20 most recent listings, preferably in your specific market area. This information allows you to evaluate their effectiveness by examining metrics like average days on market and the ratio between closed prices and original asking prices.

      When buying, an agent should provide a detailed list of their services and examples of previously acquired properties. This allows you to evaluate their track record by examining purchase prices, renovation costs, time to market, rental timelines, appreciation rates, and rent growth. Note that they typically won't share exact addresses of these sample properties, as most investors prefer to keep their property and investment information private.

      Good agents should also make it easy to terminate their contracts or services, as they are usually confident in their competence and would be happy to release their clients if they can’t deliver results or if the relationship turns out to be a mismatch.

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  • Christian Maluo
    Real Estate Broker · Portland, OR · Member since 2025 · 81 posts · 43 votes
    1y

    You do get what you've paid for. When someone easily gives away their money, they will easily give away yours. 

    1Reply
  • Chris SeveneyBusiness Member
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    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    1y
    Quote from @James McGovern:

    Listing agents who charge more don't often provide a better outcome compared to agents who have rock bottom listing fees. Agents will sell based on creating an emotional connection and not a guaranteed better outcome. They will pitch the level of effort but not commit to delivering anything better than a low cost agent will


     Respectfully disagree - its about doing your due diligence on hiring an agent and the ones we use I believe are worth their weight in gold. 

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Chris Seveney what exact steps do you recommend for due diligence?

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  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    1y

    I think you have good agents and bad agents...it doesn't always correspond to what they charge or how long they've been doing this.

    5Reply
  • Michael K GallagherBusiness Member
    Real Estate Agent · Columbus OH · Member since 2018 · 1k+ posts · 1k+ votes
    1y

    @James McGovern unless you've done some kind of controlled study selling identical homes and properties with "premium" and "discount" agents and somehow have a control variable, I'm not seeing how you could possibly have any actual data or facts to back up such a statement. 

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Michael K Gallagher your logic applies on both directions. I challenge you to identify any published study that qualifies paying more for agents gets you more

      0Reply
  • Brandon VukelichBusiness Member
    Real Estate Broker · Tacoma, WA: 🏢 27 LTRs 🏡 3 STRs · Member since 2018 · 546 posts · 456 votes
    1y

    @James McGovern You seem to post a lot about agent commissions and agents. I recommend you get your real estate license. You'll save so much in commissions and won't have to worry about underperforming agents. It would be a win-win for you.

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Brandon Vukelich Getting a license provides zero value to me. If I wanted to save money I would use a flat fee MLS service

      1Reply
  • Rick Albert
    Real Estate Agent · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    1y

    For my buyers, some of the best deals have been when the listing agent is a discount broker.

    In all seriousness, my last one was in multiple offers, still got it for below list price and got a credit when in escrow. 

    Another one of my buyers got a property below list price (this is in 2021 when everything was flying off the shelf), got them a credit, and it was contingent on them selling my clients' house (which I got them $84K over list with 15 offers). 

    Who you work with absolutely matters. The lower the fee, it means that they have to burn and turn these properties and with tighter margins means less services (professional photos, lockbox tours, no open houses, etc.). 

    You are correct that agents who are "full service" still may suck. That's the problem with the Realtor industry. There aren't clear standards of what to expect and very little oversight.

    2Reply
  • Seth McGatheyBusiness Member
    Real Estate Agent · Milwaukee WI · Member since 2024 · 318 posts · 252 votes
    1y

    First time home buyers are getting a lot out of a good agent. They are being taught the process, have skilled negotiator on their side, someone that knows the contracts, someone that knows the market, someone who knows what to look for in a showing to ensure the house is in good condition, they potentially bring some off market deals if available, etc. 
    A first time seller is getting a lot of the same things plus a good advertiser, someone who knows what will make the property sell, someone who will seek out buyers, do open house, professionally stage it if appropriate for their price and market, knows what is and isn't appropriate for their price and market, etc. 

    For experienced investors, some of those benefits are lost because the investors already know a lot of that themselves. But what the agent can still do is be a second expert to help discuss and bounce ideas off of, bring in and help manage contacts for all the different connections an investor needs. Often handling a lot of the details of the transaction so that the investor can focus on the more important things. 

    All that to be said, as an agent and investor myself, I think most agents aren't good agents and don't provide most of those benefits, or if they do, they provide them poorly. So just make sure you are getting an actual good agent. 

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  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    1y
    Quote from @James McGovern:

    Listing agents who charge more don't often provide a better outcome compared to agents who have rock bottom listing fees. Agents will sell based on creating an emotional connection and not a guaranteed better outcome. They will pitch the level of effort but not commit to delivering anything better than a low cost agent will

    So the actual heart of the issue is: do full service listing agents offer any value (and if so to whom?) above the value offered by low cost flat fee brokers?   The difference in price is between paying 3% of sale price or paying a fee of say $500 -750.  So for a $400k property sale it’s $12,000 for the sell side vs $600 for the sell side.  What value is there in paying the full boat”?

    ok, here’s my take.  For people who have absolutely no idea of the real estate process, the full service broker has a lot of value.  Pricing, negotiation, and most importantly ADVICE, can add up to value far beyond the difference in fees.
    For people who have some familiarity and experience with the real estate transaction process , AND some experience in negotiating,  there’s a more limited value in full service brokerage - but still a value.  Perhaps this individual can negotiate a more limited service menu with the listing broker - less than full service by more than flat fee.  
    For people experienced in both real estate and negotiation, the value is still less, and they should be prime candidates for flat fee service. This is a case where the value to these individuals is in the MLS ITSELF more than anything else. If they can get access to the MLS for $500 rather than $12,000 then the answer is for them is obvious.

    I personally utilize a full service broker UNLESS the property market is one I am very familiar with.  So, for example, a residential or commercial property I’m selling in a major city in Texas, or in Phoenix, or in parts of Michigan I’ll forgo the full service broker and save the listing fee.  Almost anywhere else I’ll engage the VERY BEST broker I can find.  I can’t begin to tell you how much MORE money I MADE by engaging a full service brokers in these areas where I lacked expertise.  

    And here’s another very important point.  For people who would benefit from full service representation, I would recommend listing with the BEST broker in the area, NOT your spouse’s 2nd cousin who just got the RE license. 

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Don Konipol how come there is no temporal data published anywhere showing full service brokers deliver more value compared to discounted brokers?

      1Reply
    • Don KonipolBusiness Member
      Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
      1y
      Quote from @James McGovern:

      @Don Konipol how come there is no temporal data published anywhere showing full service brokers deliver more value compared to discounted brokers?


       I don’t know - my answer is based on my personal experience. 

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Don Konipol is there any website that fully and exhaustively documents what a full service broker does?

      0Reply
    • Eric FernwoodBusiness Member
      Realtor · Las Vegas, NV · Member since 2014 · 993 posts · 1k+ votes
      1y
      Quote from @James McGovern:

      @Don Konipol is there any website that fully and exhaustively documents what a full service broker does?

      Not sure of an authoritative website that exhaustively documents full-service broker services, but below is my opinion.

      On the buy side, a full-service investment agent should provide services like the following (borrowing the process we follow) -

      On the sell side, the listing agent should provide at a minimum the following services.

      • Correctly price the property based on the market condition of that particular segment and property condition. This is the biggest value of a good listing agent.
      • Correctly prepare the property for sale. Again based on the condition of the particular market segment and competition.
      • High-quality professional listing photos, including virtual staging photos for vacant properties.
      • Make showings easy
      • Screen for most likely to perform buyers
      • Negotiate price and terms most favorable to the seller, including repair requests.

      If you can find a discount broker that can provide excellent, comprehensive services, I would go with them any day of the week. I agree with you that fees alone are not indicative of outcome.

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Eric Fernwood you mentioned "correctly prepare the property for sale" without saying exactly how does an agent accomplish this?

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    • Eric FernwoodBusiness Member
      Realtor · Las Vegas, NV · Member since 2014 · 993 posts · 1k+ votes
      1y
      Quote from @James McGovern:

      @Eric Fernwood you mentioned "correctly prepare the property for sale" without saying exactly how does an agent accomplish this?

      Correctly preparing the property for sale is a team effort between you and your listing agent.

      First, the basics.

      First impressions matter. When selling, your property should look clean, neat, and welcoming from the curb. That means pulling weeds, tidying up the yard, and repainting if the exterior looks like a neglected property.

      As buyers approach, the front door should look fresh—repaint it if needed, and make sure the hardware is clean and polished. Clear away any dust, cobwebs, or spiderwebs from the entry.

      When buyers walk in, they immediately form opinions. If the house smells musty or unpleasant, they may leave right away. Don’t use artificial air fresheners to cover up odors; buyers often suspect you’re hiding something. A truly clean house smells fresh on its own.

      Lighting is important. Swap out old yellowish bulbs for 4000K LED bulbs to create a bright, inviting atmosphere.

      Once the house is ready, hire a professional real estate photographer. Phone photos or shots from a family member won’t cut it. Good photos make a huge difference—bad ones can make even a beautiful home look dark and uninviting.

      If your house is furnished, depersonalize it. Take down family photos and remove religious or political items. You want buyers to picture themselves living there, not see reminders of someone else’s life.

      What else you need to do beyond these basics depends on the market:

      • In a hot seller’s market, just price the home correctly to its condition and you’re set.
      • In a balanced market, a good agent should provide you with estimated sale prices for three scenarios: as-is condition, partial renovation, and full renovation. They should also include the projected costs and timeframes for each renovation option, helping you choose the best approach for your specific situation. Additionally, the agent should oversee the renovation process, ensuring it stays on schedule and within budget.
      • In a slow, buyer’s market, you’ll need to make the home as close to move-in ready as possible and price it attractively for buyers. Remember, your personal preferences don’t matter—improvements should appeal to your target buyers. For example, you might love a hot tub, but if your target market is families with kids, they may see it as a drawback. Your agent should help you focus on what buyers want and what’s worth the investment.
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    • James McGovern
      OP
      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Eric Fernwood  what you are describing really falls on the seller and can be done independently of the agent 

      0Reply
  • Julie KnutsonBusiness Member
    Real Estate Broker · Watertown, SD · Member since 2024 · 24 posts · 7 votes
    1y

    Relationships & Trust. Contracting with a Real Estate agent is at its core someone who will work on your behalf, confidentially, and has a legal and ethical obligation to bring you qualified buyers. They perform fiduciary responsibilities as related to the transaction. 
    They should be in contact with you regularly during the selling / buying process. 
    Depending on your investment, there may be title issues, boundary issues, environmental issues, too many to mention. 
    A good agent should know about future planned development in the area that could affect your future value, market rents & property value, opportunity zones, high level 1031 knowledge. 
    As a seller you want to know value of your property, and is it being marketed at it highest & best use value. Someone who can offer investor friendly analytics, and a vast network of professionals, not just realtors and investors. Someone who can put together comprehensive marketing and knows  occupancy rates, budget transparancy, CAPx, property condition, city ordnances & codes, risk assessment. 
    and more...

    If you are having issues finding an agent in your state, I would be happy to refer you to someone who is seasoned and professional, or will provide 2 or 3 to speak with. ~Cheers! 

    1Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    1y

    Almost didn't respond because the way this is presented is a waste of time.

    @James McGovern For whatever reason, you've tried to state your opinion as a fact.

    While there is some truth in your opinion, unless you can back it up with facts, it will ALWAYS just be your opinion. Nothing you argue will change that.

    Here, have fun with some facts:

    https://www.richmondfed.org/publications/research/economic_b...

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Drew Sygit so the fed thinks there is a ton of needed improvement in agents as well

      0Reply
  • Mike Dymski
    Investor · Greenville, SC · Member since 2016 · 5k+ posts · 13k+ votes
    1y

    I selected a buyers agent based on referrals, my discussions with them, the agent's investment portfolio, and the leads they brought. Didn't care about the later listing...my buyer's agent got that by default for bringing the property in the first place. My agent was the linchpin of my investing when I bought SFR.

    1Reply
  • Colleen F.Pro Member
    Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
    1y

    I think what I would want when I pay more for a RE agent is to take away more from the transaction and that it is smooth.   The volume of sales someone does making them a top agent in an area is not value if you don't get a good value for your particular sale.  It is not volume or the full service you are looking for it is what is the right agent in this market to sell your property. For selling, if you have a buyer and the amount is right that might be no agent. If you intend to sell a lot of properties it could be that top agent. However if an agent is driven by volume and you don't offer that volume you may not find they are the best agent for your property.  You have to look at several agents, do the due diligence. Don't yield to a relative or friend or a discount just because...  

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    • James McGovern
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      Flipper/Rehabber · Bloomfield CT · Member since 2020 · 1k+ posts · 408 votes
      1y

      @Colleen F. What evidence exists that a discount agent can't guarantee a smooth transaction?

      0Reply
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