Buying a home can easily feel overwhelming, but luckily, you don’t have to do it alone. Your real estate agent should be able to guide you successfully through homebuying milestones as you navigate the process.
A good real estate agent will know the area well and have a firm grasp on current market conditions. They’ll find homes that match your budget and what you’re looking for, answer your mortgage questions, and lend their experience during negotiations to help you score a deal on the final purchase price.
“Remember, your agent’s role is to represent you, negotiate on your behalf, guide you past potential pitfalls, and put your needs and wants above all else,” says Mark Pessin, chief learning officer at Realty One Group in Laguna Niguel, California. “Making the right choice is essential to your success in a home sale or purchase.”
Different real estate agents come with varying areas of expertise, so it’s worth taking the time to evaluate your options and pick the right one. Here’s how to find a real estate agent who fits your needs:
- How To Find a Real Estate Agent
- What To Consider Before You Select a Real Estate Agent
- How To Hire a Real Estate Agent
- The Bottom Line
How To Find a Real Estate Agent
If you’re buying your first home, then you’re likely new to searching for a real estate agent. The good news is that there are plenty of candidates who can represent you — but the number of choices out there may make it more difficult to find the right fit. Here are the steps you can take to seal the deal with a qualified real estate agent.
Do initial research
You can begin researching online by looking for active agents at real estate companies in your area. However, those aren’t the only places where you can browse. Agents affiliated with reputable companies often benefit from the trust and visibility that comes with brand recognition, but independent real estate agents may also have a proven track record. Pay attention to online reviews and see if these agents have their own website or LinkedIn page that shows their experience and any accolades they’ve earned.
“You’ll also be able to see that agent’s sales history in the area you’re looking to buy or sell in, which can be an indicator of experience and expertise,” Pessin says.
Additionally, you may want to check with the Better Business Bureau to see if any complaints have been filed against them by unhappy clients.
Ask for referrals from friends, family, and lenders
Five-star reviews from strangers don’t guarantee that you’ll have a good experience. Even if some agents look polished on paper, you might be asking yourself, “How can I find real estate agents I trust?”
A great place to start is by asking the people you already trust if they can recommend their real estate agents. This is especially useful if you’re asking friends and family members who live in the same area and are in a similar financial situation.
“This first-hand referral increases the likelihood of receiving the level of service you’re looking for,” Pessin says.
You could also ask your lender if they’ve had a positive experience working with any real estate agents. Since the lender’s money is on the line, they have a vested interest in your home purchase being conducted by a savvy, proven professional.
Interview at least three agents
Speaking directly with candidates will help you learn more about what sets them apart from each other in their experience, approach, and demeanor. After all, real estate agents are people, not computers, so you should make sure you’ll be comfortable working with them. The last thing you want is a personality clash.
But how do you know which questions to ask when choosing a Realtor to buy a home?
“Questions should include basic items like whether they are full time or part-time, years in the business, number of homes sold annually, and what percentage of their business is buyers vs. sellers,” Pessin says. “Beyond these, you should ask more probing questions around the menu and level of services they provide customers, will they be your primary point of contact or will you be working with other members of their team, and of course what fees will you be responsible for paying for their services as they tend to vary by market.”
He says that if a real estate agent comes highly recommended by someone you trust, then it may not be necessary to interview many others. However, if you’re considering agents that you found on your own, then you should interview several candidates.
It’s a good idea to ask serious candidates to provide a few references. By talking to former clients, you’ll be able to gain insight into the real estate agent’s working style and determine if their clients were satisfied with their homebuying experience. It’s possible that an agent can be charming and talk a big game in the interview, but then you find out from their previous clients that they’ve dropped the ball in the past.
What To Consider Before You Select a Real Estate Agent
To whittle down your list of candidates, it’s important to think about the traits and qualifications that will make a real estate agent the right fit for you. While there’s no one-size-fits-all formula for how to choose a Realtor, the following are some key factors to consider before making a decision.
You may hear the terms “real estate agent” and “Realtor” thrown around interchangeably, but they are not the same thing.
In order to become a real estate agent, one must obtain a professional license from the state. This requires completing a certain amount of training (the exact number of hours will depend on the state) and passing a written exam that tests both federal and state-specific real estate laws.
A Realtor, on the other hand, is a real estate agent who has joined the National Association of Realtors. This organization enforces higher standards and a code of ethics for its agents. You can use NAR’s directory to look up specific Realtors by geographical area and verify their membership, as well as additional designations and certifications that they’ve earned.
“Agents that are learning-based tend to have more relevant knowledge and strategies for your success,” Pessin says. “That being said, there is no certification that can replace or be a substitute for good old-fashioned experience.”
Market knowledge and experience
A thorough understanding of market conditions and extensive experience in negotiating home sales are a big part of what makes a good real estate agent.
“Agents that consistently close a moderate to high number of transactions annually, have a high rate of happy customers, and receive repeat and referral business year in and year out are proven experts at what they do,” Pessin says.
He suggests asking the real estate agent to tell you about current market conditions, including how many homes are on the market and whether property values are increasing or decreasing. It’s a good indicator of how well they’ll be able to guide you through the buying process.
Related: When Is the Best Time To Buy a Home?
“Experienced agents don’t hide their experience!” says Patricia Avella, director of residential sales and brokerage at AKAM Sales & Brokerage Inc., a real estate company based in New York City and Dania Beach, Florida. “The best way to evaluate market knowledge and experience is taking a look at an agent’s past sales and closings.”
She also notes that it’s beneficial when the real estate agent has history in the area where you’re looking to buy.
“Yes, agents can work anywhere but the best ones tend to work where they live — they know the stories, the neighborhood, schools, stores, transportation, etc.,” Avella says. “This all adds to experience!”
The buyer-broker agreement is a contract between the buyer and their real estate agent. It authorizes the agent to work on your behalf during the home purchase and outlines the services that they’ll provide, which in turn ensures that the agent will get paid for their work. Not all buyer-broker agreements are the same, so it’s important to pay attention to the specifics of your contract.
Pessin recommends checking the start and end dates to confirm they match what you’ve discussed. He also suggests clarifying what happens if you experience a sudden change in plans and need to terminate the contract.
As the buyer, one thing to keep in mind is that you typically won’t have to pay your real estate agent directly, as their commission is split with the seller’s agent once the home sale is finalized.
Communication style, personality, and rapport
When it comes to what to look for in a Realtor, don’t forget to consider their vibe and communication style. Since you’ll be teaming up with this person on a major investment, your work chemistry matters. It’s important that your real estate agent is someone you enjoy interacting with — that way, you’ll both be willing to take the time to iron out important details.
Potential red flags
- They are inexperienced or have a low volume of clients. Real estate agents who only close a handful of home purchases per year may not have the experience necessary to represent you effectively, Pessin says.
- They seem too aggressive. You never want to feel pressured by your real estate agent to rush into a deal or select a specific property.
- They get bad reviews. You can’t make every customer happy, so it’s not uncommon for a good real estate agent to get a few bad reviews. But if you see a pattern that concerns you, it might be wise to pass on that agent.
- They have a bad attitude. While your real estate agent should be realistic about what you can afford, you don’t want a “negative Nancy.” They should encourage you and make you feel confident about the homebuying process.
Costs and real estate fees
When you buy a home, your real estate agent and the seller’s agent will typically split a 5%-6% commission fee based on the final price of the house. In addition to a commission fee, your real estate agent might charge a transaction fee to cover administrative services and paperwork. These fees should be explicitly outlined in your contract.
“Fees and commissions vary widely from market to market, and are always negotiable,” Pessin says.
Your agent may have a lender that they’ve worked with repeatedly and recommend using based on past clients’ experiences. According to the National Association of Realtors, real estate agents aren’t allowed to receive a kickback for referring clients to mortgage brokers or bankers, so you don’t need to suspect underhanded motivations if your agent suggests names.
The agent’s real estate team
Before you hire a real estate agent, you should find out whether they work independently or as part of a larger team.
“A lot of agents have teams these days,” Avella says. “Make sure whoever you hire is who you work with.”
Avella notes that while the agent’s team can help streamline paperwork and administrative processes, you’ll want to make sure you know who your point person is.
How To Hire a Real Estate Agent
Once you think you’ve identified the right candidate, there are some important steps to follow in order to officially hire your real estate agent. Although you might feel eager to get moving, these details are crucial to setting up both your working relationship and home purchase for success.
Make sure you’re preapproved for a mortgage
It’s a good idea to get preapproved for a mortgage before you hire a real estate agent. A mortgage preapproval letter shows agents and sellers that a lender has assessed your finances and is tentatively willing to offer you a home loan. Many real estate agents may refuse to show you homes if you don’t have proof that you’re able to get financing.
A preapproval letter also gives you an idea of what kind of home you can afford, which is important information to have before you begin interviewing real estate agents. Although it’s not a final guarantee, a mortgage preapproval letter outlines how much financing you can get.
Sign a buyer-broker agreement
This is the part where you make it official with your real estate agent. The buyer-broker agreement often involves exclusivity, which means that you won’t be working with any other agents. According to Pessin, this can also benefit the buyer.
“By agreeing to work with one agent exclusively, you are ensuring that agent is completely dedicated to you and your needs,” Pessin says. “If an agent knows that you are working with other agents as well, they aren’t likely to give you as much of their time, energy, or effort as they know there is a high likelihood that you may do business without them.”
Request and sign an agency disclosure
The agency disclosure is a document that clearly states what roles you and your real estate agent are playing in the transaction. It indicates whether the agent is working on the behalf of the buyer or seller.
“Sometimes there are dual agency situations where the same agent is used on both sides of the transaction — all of these relationships would be clearly defined in an agency disclosure,” Avella says.
She notes that first-time homebuyers are better off having their own agent. Ultimately, a real estate agent who represents both sides may be more incentivized to look out for the seller’s best interests.
Ask them to explain all additional forms before signing
Part of your real estate agent’s job is to make sure you understand every document before you sign it. Certain contracts and agreements can be pages and pages long and contain legal jargon that you might not be familiar with.
Don’t be intimidated! Ask your real estate agent to walk you through any parts that you don’t understand before you sign on the dotted line. Someone who can’t or won’t explain things to you clearly might not be the right agent for you after all.
Be ready to buy
Once you’ve gotten preapproved for a mortgage and hired a real estate agent, there’s no more messing around. By this point, you should have all of your ducks in a row. While you certainly don’t want to rush into the wrong decision, keep in mind that mortgage preapproval letters typically expire after 30 to 60 day, so make sure that you’re all-around ready to buy a home.
The Bottom Line
When you’re looking for a real estate agent, you can cast a wide net by researching online and asking for referrals from trusted sources. Then, you’ll be able to narrow down the candidates by conducting interviews and examining their experience, market knowledge, and style. Once you find someone that you feel comfortable with, the two of you will be able to team up to make your homebuying dreams a reality.
There are a lot of good real estate agents out there, but some are more equipped than others to help you land the right home in the right place (for the right price).