Why Engage A Property Agent When I Can DIY?
Apart from the real estate scene, agents tend to have a bad reputation across all industries. People assume that they have an easy job and that they are fundamentally still salespeople. Along with these misconceptions and the advancement in technology, an increasing number of people have been doing away with agents and handling property transactions on their own.
Here are 4 common misconceptions about real estate agents to help you understand more about them!
Misconception #1 - They have an easy job, I can handle the property transaction myself
People tend to assume that all a property agent does is to conduct viewings and handle the paperwork, but not many actually know what goes on behind the scenes. As property agents ourselves, we have had clients asking for a discount in commission for selling their house within 2 weeks as they felt that it was “too easy a job”.
A lot of planning and preparation work happens before actually listing a unit for sale on the property portals. Different types of properties are marketed differently to bring out their unique features, and to attract potential buyers in the quickest time possible.
Also, unless you are someone who has had a lot of experience flipping properties, you probably only have a vague picture of the processes of selling or buying a property. An experienced agent would have handled many property transactions and would be able to advise you on the dos, don’ts, and things to take note to ensure a smooth transaction, for example, the constantly changing HDB rules and regulations! Being one of, if not the largest transaction of your lives, this is definitely not something that you will want to screw up!
Misconception #2 - I will be stuck with an agent if I sign an exclusive contract. I’ll get better results if I engage more agents
Legally, an exclusive contract can only last for a maximum of 3 months a term, with the option to renew upon expiry. This is to protect the interests of the consumers, in the case that they are not satisfied with their experience with their agents.
“But, why should I even sign an exclusive contract and tie myself down in the first place?”
Even though engaging multiple agents to sell your house might sound like a better idea, too many cooks spoil the broth. When multiple agents represent you in the sale, only the one who closes the deal gets the commission. Instead of finding the right buyer to buy your property at the best possible price, they might try to push your price down to sell faster. Having one fully committed agent is better than having 3 agents handling your property like a ‘part-time job’.
Misconception #3 - All agents are the same. I might as well engage a low-commission agent to save some money
How often has the cheaper option been the better option? If you do decide to engage a low-commission agent, be sure to know the kind of services they are going to provide. A poor agent can result in your home not being able to sell off quickly, or fetch the best possible price.
An agent who charges market rate or higher is usually more experienced and confident of their abilities to handle your transaction. They may also include value-added services such as home-tour videos or virtual walk-throughs, giving you a higher chance of having a more positive experience with them.
That said, not all cheaper options are bad too! Some newer agents may be willing to accept a lower commission to gain more experience as well. However, do watch out for some agencies that offer fixed fees. Agents are essentially salespersons, and a fixed commission gives them no incentive to work harder to fetch you a better price.
Misconception #4 - Agents are dishonest and they will do anything just to make the sale
There may be some bad apples out there, but this doesn’t mean that the entire basket is rotten. Referrals are very important to real estate agents, and it is unlikely that they will put their reputation at risk. The CEA (Council of Estate Agencies) ensures that agencies and their salespersons perform their due diligence and uphold proper conduct. If they are caught with misconduct, they could be fined heavily and even lose their licenses. You may also run a check on the agent that you are engaging to have a peace of mind.
As with all buyers/sellers/tenants/landlords, agents are also humans. If an agent can lie to you about the defects of a house that you are looking to buy, an unrepresented direct seller can also do the same!
Is it necessary to engage a real estate agent?
With the advancement in technology, more people are now opting to DIY their property transactions. HDB has enhanced the resale portal to simplify the processes for buyers and sellers alike. However, are you willing to trade days and weeks of research and headaches just to save a few thousand bucks on agent fees?
Most full-time property agents have a few years of experience and have the proficiency and knowledge to see you through a transaction smoothly. They are always on the ground, and real estate matters are only second nature to them. Agents are commission workers, and they will always try to secure the highest price as that would affect how much they earn for the deal. In fact, good agents are often superb negotiators, and they might even be able to help you close the sale at a price higher than the asking!
Humans are emotional creatures and tend to make some poor decisions when driven by emotions at times. DIY sellers may inevitably receive some lowball offers or receive negative comments about their house. Would you be able to handle such rejections and continue to negotiate the deal? This is when property agents play an important role. As they are not tied down with any emotional baggage, they can stay fully focused on helping you get the price possible price.
But, there are so many agents out there and I don’t personally know any. How do I know who to work with?
We recommend that you speak to a few agents, and find one whose goals are aligned with yours.
Above Homes is founded by a team of like-minded real estate consultants who strive to help home seekers and sellers achieve their property goals.
If you found our content helpful and are ready to start exploring your property options, reach out to us!
