Do I Need a Realtor?
You don’t.
There is no law that requires the use of a Realtor in a transaction. You are effectively free to represent yourself.
Much in the same way that you don’t need an attorney to represent you in a court of law nor do you need an accountant to prepare your returns, you do not need a Realtor when you buy or sell real estate. But the fact that you can represent yourself does not mean that it is a good idea.
As a matter of a fact, acting as your own representative is a rather poor idea. Let’s discuss why.
Issue One — Access to MLS
Members of the Richmond Association of Realtors have access to MLS. The public does not.
Yes, Zillow shows sales, as does the public tax records, but the quality of the information as well as the age of the information are suspect. Neither Zillow nor tax records are a curated database in the way that MLS is.
The main difference is that the integrity of the MLS database is guarded by agents. We are required to comply with about 40 pages of rules and regs as it relates to how we manage the information in the database. We are subject to fines, suspension of access and/or potential loss of license for transgressions. Unfortunately, Zillow and other online sources do not offer any policing of information, putting you at risk of viewing delayed or inaccurate data.
Issue Two — Commission Savings Are Not What They Appear to Be
“Well, if we don’t use a Realtor, we will save the 3%,” is the classic buyer thought — and it is not correct.
A listing agreement states the amount of commission that will be paid to the brokers involved in the sale by the seller. If there is only one broker involved in the sale, then that individual broker receives the entire commission. In other words, by representing yourself, you create a scenario where one agent effectively gets paid twice as much…
Can the commission be negotiated? Sometimes it can, but agents worth their salt will know that when only one broker is involved, their job responsibilities increase, and so does the risk. When asked by an unrepresented party if they will cut their commission, many agents simply decline. It isn’t worth the effort.
Issue Three — Advocacy
Respectfully, we have a far better understanding of real estate than many of our clients ever will.You can interpret that as an arrogant statement, but the reverse is also true. We have an accountant do our taxes, numerous attorneys handle any legal needs, a mechanic that is awesome, and a series of other service providers that we use constantly.
Why? Because we cannot do what they do as well as they do.
We have seen quite a few cases where the buyer, in an attempt to save the commission ended up with a worse deal due to price and terms.
Don’t be that person.
Issue Four — Time
Contrary to popular belief, good agents work extremely hard. The number of calls is staggering — and that is before you factor in the amount of paperwork now required, the endless e-mails, and the countless site visits to meet inspectors, contractors, appraisers, utility providers, etc.
So the assumption that Realtors just show up, write a contract, and then wait for a check is pretty inaccurate.
Summary
HGTV makes it look easy — trust us, it isn’t.
Good agents are a combination of many things — appraiser, computer nerd, inspector, soothsayer, taxi service, psychologist, problem solver, gofer — and when you add it all up quite, underpaid hourly worker. The insurances we carry, the memberships required, the time invested, and the number of online platforms that we have to subscribe to make simply being in the business a far more expensive endeavor than even a few years ago. Oh and by the way, we only get paid if the deal closes so all of the work we do is performed with no guarantee we will get paid for it.
We would suggest you interview several agents and spend some time talking about the process before considering being your own representative — there is more to it than you might think.
