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Don't assume that you have to go house-hunting with the first real estate agent you talk to, whether that agent is a buyer's or a seller's agent. You'll be working with your agent for weeks or months, so take the time to find a good partner in your search for a home. Talk to several agents and to their former clients before you choose your buyer's agent.
Interview agents
Employers wouldn't dream of hiring a new employee without an interview. When you choose an agent to work with, you effectively hire that agent. After you contact several agents, choose three who seem like good candidates. Sit down with each for a heart-to-heart. During the conversation, take notes and pay attention to body language.
Here are some questions to ask during the interview:
- Do you work as an agent full-time? If not, find out how much time the agent devotes to his real estate practice. You want an agent who's available when you have a question or concern.
- How long have you been selling real estate? An experienced agent knows the local market and is both familiar and comfortable with the process of buying a home.
- How many homes did you help buyers purchase last year? Ask for a list of these homes, along with the listing price and purchase price.
- Do you represent both buyers and sellers? If the agent says yes, ask how she handles a dual agency.
- What's your average list-price-to-purchase-price ratio? As a buyer, you want to find an agent with a good track record of negotiating deals. Look for a ratio that shows the agent has helped buyers purchase homes for less than the asking price. For example, say the agent helped three clients buy houses that were all listed for $250,000: The first client paid $243,000 (97.2 percent of the list price), the second paid $248,500 (99.4 percent of the list price), and the third paid $241,900 (96.7 percent of the list price). That agent would have a list-price-to-purchase-price ratio of 97.7 percent, showing that, on average, his clients paid 97.7 percent of the sellers' asking prices. When you compare two agents, a lower list-price-to-purchase-price ratio may indicate a better negotiator.
- How will we communicate? Some agents will pick up the phone and call you when they see a listing you might like. Others will shoot you an email. Some contact clients frequently - possibly several times a day - others less so. Make sure the agent's preferred communication style is compatible with your own.
- How many buyers and sellers do you represent right now? What you're really asking here is whether the agent has sufficient time to devote to help finding you a home. A super-busy agent who's going to four or five closings a week and hosting open houses every weekend may not.
- What's your assessment of the current state of the local market? Find out whether the agent sees the current market as a buyer's market, a seller's market, or something in between - and how that will affect how she works with you.
- What's your strategy for helping me find a home? Listen to what the agent says about how he hunts down homes that look like a good match. If you're likely to be in stiff competition with other buyers, ask how the agent handles multiple offers on the same property.
- Do you have access to homes that are For Sale by Owner (FSBO)? Some homeowners decide to sell their homes themselves, without the assistance of a real estate agent. If you're interested in FSBOs, ask how the agent can help you find such homes. Ask, too, about how the agent gets paid when dealing with FSBOs.
- Will you help me find the other professionals I need to buy ahome? Your agent can refer you to preferred lenders and title companies, home inspectors, and real estate attorneys. You don't have to take any of these recommendations, but you might find it helpful to get suggestions of people who've worked well with the agent in the past.
- How do you find most of your clients? Look for an agent who does lots of business with repeat clients and referrals.
- Can you give me some references to contact? The section below discusses what to ask people who've worked with the agent in the past. You want to know about buyers' experiences, so you don't have to contact people who sold their homes with this agent.
- What happens if you don't find me a home? If things don't work out with this agent, you need to be able to cancel the agency contract and move on.
- What other question should I ask you? How the agent answers this question indicates what she thinks buyers in your area need to know.
Check references
After you interview agents, you may have a strong sense of which you'd like to work with. Before you sign a buyer's brokerage agreement, though, call some buyers the agent has worked with in the past. Checking references can confirm your hunch - or send up a red flag. It can also serve as a tiebreaker if you're having a tough time deciding between two agents. When you call references, be considerate. After all, the person is doing you a favor. Don't call at an inconvenient time, like dinner hours or late at night. Introduce yourself, explain why you're calling, and ask whether the person has a few minutes to talk to you (if you get "no" for an answer, ask if there's a more convenient time when you can call back). Keep the phone call brief, but try not to hang up with a lot of unanswered questions.
Ask these questions to get a sense of how well the agent worked with previous buyers :
- Describe your overall experience working with the agent.
- Would you describe the agent as honest and trustworthy?
- Did the agent devote sufficient time to working with you? Was it ever difficult to arrange a showing or a meeting because the agent was too busy? Did the agent deliver offers and complete paperwork on time?
- What did you like best about working with the agent?
- What did you find most frustrating about working with the agent?
- Would you work with this agent again?
- Looking back on your home-buying experience, do you think this agent helped you make the right choice?
Take notes during the conversation, and be sure to thank the person for her time before you end the call.
Go online to read reviews of real estate agents in your area at www.homethinking.com and www.incredibleagents.com.
Make a decision and make it legal
After you speak to references, you have the information you need to choose an agent. Take these factors into account:
- Compatibility. Is the agent someone you'd enjoy working with? You're not looking for a new best friend, but you'll spend a lot of time with your agent as you tour homes, discuss strategy, fill out paperwork, and do the myriad other activities involved in buying a home. Your agent should be compatible with you in terms of personality, approach, and communication style.
- Understanding. It's important that your agent "gets" what you're looking for in a home. Otherwise, you'll both waste your time looking at properties that aren't a good fit for you.
- Availability. Look for an agent who'll work with your schedule. You don't want to find yourself missing opportunities because you can never find a common time to meet.
- Trustworthiness. Your agent has a fiduciary duty toward you; that means your relationship is based on trust and confidence. You need to work with someone you trust to deal with you fairly, to keep a lid on your confidential information, and to represent you with both honesty and honor.
Once you decide on an agent, sign a buyer's agency agreement. A written, signed agreement clarifies the responsibilities of you and your agent both - so you can get on with the business of finding your dream home.
