Would it surprise you to learn that some people spend more time shopping for a T.V. or new car than on finding a real estate agent? Even though your home is generally your single most expensive asset, we often spend only a few minutes (or, if we’re lucky, a few hours) choosing a real estate agent to work with on this transaction.
Whether you are a buyer or a seller, this oversight can cost you big time. Therefore, it’s essential to find the right real estate agent by researching and asking the right questions.
Key Takeaways
- Real estate agents are professionals who guide you through the home buying and selling process
- You may need to interview several Realtors before you choose the right one for you
- Many home buyers and sellers find their real estate agent through a friend or family member’s referral
Basics of Real Estate Agents
A real estate agent is anyone with a real estate license. Realtor is a trademarked term for an agent who belongs to their provincial council or the Canadian Real Estate Association (CREA).
The requirements to become a real estate agent vary from province to province. For instance, in Ontario, agents must complete a Real Estate Salesperson Program within 24 months and register with the Real Estate Council of Ontario.
Due to regulations, real estate agents must work for a real estate broker or brokerage. Therefore, when you hire an agent, you also hire their brokerage.
Real estate agents charge a commission, typically based on a percentage of a property’s sale price. The home seller generally pays the commission for both the buyer and seller’s agent.
Buyer’s Agent
A real estate agent representing a homebuyer is called a buyer’s agent. The agent’s primary responsibility is to guide you through the home-buying process by arranging showings, negotiating on your behalf, handling any counteroffers, and helping you navigate the home-closing process.
Buyers sign a Buyer’s Representation Agreement (BRA), which outlines the agent’s duties and obligations, establishes the agency relationship, and outlines your responsibilities as the buyer.
Seller’s Agent
A seller’s agent, also known as the listing agent, represents the home seller. Their primary responsibility is to list the home for sale, organize open houses, coordinate showings, and set a competitive price based on market conditions. In addition, they handle negotiations with the buyer’s real estate agent and help you navigate the home-selling process.
Sellers sign a representation agreement which outlines the commission rate, expiration date, and holdover clause.
Difference Between a Real Estate Agent and a Broker
Real estate brokers are agents who have completed additional training and passed a broker’s license exam, which allows them to run a brokerage and manage a team of agents. Brokers can choose to work independently or join an agency.
How to Find a Real Estate Agent
With over 160,000 Realtors across Canada, choosing a good real estate agent may seem daunting. One strategy is to ask your trusted network of family and friends for recommendations. On the other hand, consider reading Google reviews, searching online, or calling your local real estate office.
Don’t be afraid to interview a few different agents to find the right fit for you.
Questions to Ask a Real Estate Agent
After you contact a few Realtors, it’s in your best interest to ask questions before you start working with them. Here are some examples of questions you may ask:
Are you licensed?
You’ll want to ensure that any real estate professional you work with is licensed and in good standing with their regulator. You can search for your Realtor’s name on the provincial regulator’s website. In addition, you’ll be able to see any disciplinary history or license restrictions.
What is your availability?
In a hot seller’s market, homes can sell quickly. You could miss out on homes if your agent cannot arrange home viewings in a timely manner. As some agents only work part-time, their availability could be limited. Additionally, if your agent juggles too many clients at once, they may be less available.
What do you specialize in?
While all agents are licensed to buy or sell homes, finding an agent who specializes in the type of house you want to buy can be helpful. For example, an agent who typically sells luxury homes may not be the best choice if you are looking for a fixer-upper.
Similarly, an agent who is an expert in your prospective neighbourhood is ideal. As a neighbourhood expert, your real estate agent is well-versed in the area’s market conditions and can connect you with other professionals in the community, like real estate lawyers and home inspectors.
What about dual agency?
Dual agency is when the same agent represents the buyer and the seller or if two agents from the same agency represent both parties during a real estate transaction. Dual agency can potentially create a conflict of interest. Some provinces limit dual agency unless the home is in a rural area or if all parties agree.
How do your fees work?
Real estate agents work for a commission. The seller typically pays the commission after closing, and the fees are negotiable. There are three ways to structure the commission payment: a percentage of the home’s sale price, a fixed dollar amount, or a combination of both.
Buyer Tips for Finding a Real Estate Agent
Choosing an effective agent is essential, especially if you are a first-time homebuyer. Here are some additional questions and tips for home buyers looking to hire a Realtor:
- What are the market conditions? Your agent should be able to advise you whether it is a buyer’s or seller’s market and if you should expect to offer over the asking price
- How many options are available in my price range? A good real estate agent will help you find and purchase a home within your budget
- Are you knowledgeable about the neighbourhood? Different areas experience different market conditions. An agent who specializes in the neighbourhood you want to buy a home in is an asset
Seller Tips for Finding a Real Estate Agent
Home sellers want top dollar for their property while selling quickly and efficiently. Here are some additional tips and questions to ask a Realtor for home sellers:
- What are the comparable listings in my neighbourhood? Ideally, your agent should provide you with similar listings in your neighbourhood that were sold recently.
- Based on market conditions, what is my home worth? A good Realtor isn’t necessarily the one who suggests the highest listing price. The current market conditions should support the listing price
- What home improvements should I make before the home is listed? Some home renovations or improvements provide a good return on investment when selling a home. Your realtor should be able to advise you which projects are worth the cost
Real Estate Agent FAQs
Why do I need a real estate agent?
The most significant benefit of hiring a real estate agent is their knowledge and experience of the home buying and selling process. Using an agent is not a requirement to buy or sell a home. However, working with a Realtor can help reduce stress, save time, and save money through negotiations.
Can you sell a house without a real estate agent?
Yes, you can sell your home privately within Canada. Selling a house without a real estate agent is known as For Sale By Owner or FSBO. Selling your home privately could be a good option if you are knowledgeable about the home selling process. In addition, you would save money on real estate commissions. However, you will most likely still need to pay the commission for the buyer’s agent. Moreover, you must handle all marketing, negotiations, and communications with the buyer.
Where do most people find their real estate agents?
Many people find their real estate agent through a referral from family or friends. However, some find their agent through an online search, advertisements, or by looking into active listings.
