Is there any REAL value in using an Agent?

Question

Hey folks. I am a full time agent, I started out about 2 years ago. I am on a team so I can focus most of my time prospecting. I call FSBOs, Expireds, and Cancelleds all day. I manage to set up 2 appointments a week for my team. 
          
          I am however starting to doubt if there is any value in using an agent. 
          
          What are we actually doing for the home owner, or buyer that makes us worth the commission. What are we doing that they couldn't do themselves?
          
          How can I turn one prospect into a referral client for life?

J Scott · Answer

That's where a great agent comes in.  The value of a great agent is as follows:

- Ensuring a GREAT MLS listing.  This means professional pictures, enticing copy, etc.  A great listing will generate far more interest than a not-so-great listing, and first impressions tend to last;

- Networking.  My wife is the agent for our houses (and only for our houses, no others).  She has a reputation of putting out a great product (great rehab, well staged, attentive to detail, she turns all lights before every showing, etc), and has a list of about 3 dozen buyers agents who want to know the minute she puts a house on the market, because those agents know it will be a great value.  A great agent will get you a dozen showings on the first day because s/he has a network of buyer's agents who know and trust the products they put on the market.

- Control of your deals.  A great agent will know how to get things done -- from making sure the mortgage broker is on top of things to making sure the closing attorney is on top of things to make sure the inspectors and appraisers are well taken care of.  This means a typical deal will go smoothly and will close on time.  That's rare these days.

- Negotiation.  A great agent will know how to help you negotiate the best price for your property and will help you continue to negotiate through the due diligence process and through the closing.  Great agents know the values of the properties they're selling, and can use the data they have to ensure the investor gets every penny he deserves.

Again, I'm not saying a great investor can't do these things without an agent, but I'd venture to guess that most investors don't have all these skills and therefore a great agent is invaluable...

Just my $.02...

Account Closed · Answer

I believe that it is like any business putting a clients needs first and trying to understand what the client needs are.  Active listening is an important skill that can help you perhaps even understand what a client wants and needs better than they do.

As a customer, I would expect a real estate agent to know their market area very well.  Have some idea of demographics, zoning, neighborhoods, etc.  I would expect an agent to have good negotiating skills though I would want to do most of my own negotiating.

It also depends on who the agent is serving.

If an agent is primarily a listing agent, then get the property listed on the MLS and otherwise getting the word out that the property is available for sale.  Making it easy to see the property so as to increase the chances of multiple offers or better offers.

A buyers agent that strives to fully understand what their client is looking for and scours listing and other sources to find them.  This can be a process that takes patience and may require an agent to come up with creative ways of helping their clients understand what they are looking for.  I'm sure that some clients have a very general idea of what they want.  It is not very helpful, when someone says they are looking for any home that they might buy & flip for profit.

Don Konipol · Answer

The value of a good real estate agent is the same as the value of a good carpenter or plumber.  I almost always use a real estate agent to sell my properties - for three main reasons.
          
          1- I'd rather spend the time on more profitable aspects of my real estate investing - same reason I use property managers
          
          2- I want a buffer between myself and the buyer or seller, someone who can say things to the other party or the other parties representative and be more convincing then if it came from me as buyer or seller.
          
          3- A good agent is a good salesperson. I am not a salesperson, my expertise is investing, not selling.

Alex Cortez · Answer

Depending on the client, there is definite value that they can derive from using a real estate agent.  Sure, some (a few) individuals have the diligence and work ethic to list/market/sell their own home.  However, for the majority of people, the time that it takes to properly market a home is just a luxury they can not afford.  That's where I try to pinpoint my value proposition, the marketing knowledge that I bring is (most likely) considerably more than an owner's.  Along your expertise, provide excellent customer service and you will have clients that will keep coming back to you.  Best of luck.

Dale Osborn · Answer

Most investors will know more than the agent and find the person in the middle to be a stumbling block and sometimes even a major road block to getting to the closing table. With the introduction of the internet - you can buy nation wide without using an agent. When homes were 10-20K in the 1960's, the commission of 6-7% that is "negotiable" was probably adequate. With the prices of homes today the loss of buying power to a commission is a major problem for the next purchase. I had an apartment for sale at $1.6M and was offering realtors 2% if they brought in the buyer. One agent stated that she needed 6% because she needed to "put bread on the table". By putting her greed in front of the client she was supposed to be representing the Buyer never even looked at my property!

Ron Harris · Answer

From an Investors point of view: Read fully so you don't kill me!
          
          Most RE Agents are not that great...it's the 80/20 principle. 20% of the agents have 80% of the business. The 80% just aren't that great. It seems the days of just listing a house isn't enough and open houses are not that effective. I've sold houses on Craigs list and made a killing so it's getting harder for RE to compete with FSBO. Though, the MLS is extremely valuable so a catch 22.
          
          Now, out of that that 20% RE agent that likes to work with investors is WORTH EVERY COMMISSION paid! Yeah, it's easy to sell one house every few month but when you start selling a lot...different story. We're actually looking for RE agents that can sell houses...not just list them; and can work with investors. We're now at that point where for us to grow we need to outsource more. 
          
          So again, if you can find an agent that can sell, pay them well! We're all limited by the amount of time so focus on system building!
          
          So here is a question: What 3 questions would you ask for an Agent to get the best selling agent possible?
          
          Ron

Mark Brian · Answer

Under promise and over perform.

J Scott · Answer

If the company was that bad, why did you stay for 2 years!?!?  There are lots of brokerages, and if you're unhappy where you are, find another.

I'm starting to understand why you're so "anti-realtor" now, but to be honest, it sounds like at least part of it is your own fault for not taking control of the situation earlier...

Dale Osborn · Answer

You started this thread stating that you are a realtor and not finding it a fun job to be in. Most agents - 80% seems to be the quoted number also end up where you find yourself. This is mainly due to the Brokers not wanting to invest money in a training program. Your welcome to the company probably went the same way mine went: "There's your desk and there's your phone - when do you expect to have your first deal on the table making me some money?" Not the best welcome to the company. Then you also find out that the person that came to the real estate school briefing you on their company lied to you to get you to join their company. After 2 years - I had to get away and start my own company built on charcter, ethics and morals that were lacking in that first company!

On the other hand since turning in my license and doing investing full time - I really enjoy my work. I look for anything new and innovative that will help me do better in my little market niche. It is so much better having this freedom - hope you find a more satisfying job also!

Is there any REAL value in using an Agent?

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