- Do I need a real estate agent?
- What does a real estate agent do?
In order to answer those questions, first look at different positions:
- I want to buy a home, why do I need a real estate agent? What does a real estate agent do for a buyer?
- I want to sell my home, why do I need a listing agent? What does a real estate agent do for a seller?
- I want to sell my home and buy another home, how an agent can help me? (Upsizing or Downsizing)
In this complete guide we are gonna go discuss thoroughly the above questions in different positions and how a real estate agent can help a buyer or a seller.
If you are a buyer, whether first-time buyer or an investor interested in investing in real estate and generate cash flow from your investment property, the next part is for you:
What does a real estate agent do for a buyer?
A real estate agent representing the buyer, which briefly we call it a Buyer Agent, helps his/her clients or customers, to navigate through the ups and downs of acquisitioning a home. Purchasing a home, whether you are a first time buyer, or a seasoned investor, is a big decision. A knowledgeable real estate agent can help the buyer with: 1. finding them the right fit, 2. Assessing the pros and cons of each option 3. Pointing out if there is any red flag 4. negotiating the deal, 5. Providing support till the deal closes, 6. Our agents even try to go further and not stop at the closing of the deal, but to make sure the buyers will have a smooth transition.
1.How a real estate agent can help you find the right property?
A seasoned and qualified REALTOR® should have both technical knowledge about A. the property class that you are looking for, i.e. Detached House, a Townhouse, or a Condo Apartment and B. The area that you are looking to live in.
In addition to technical knowledge, a top real estate agent, has good listening skills, he/she would listen to the buyer’s needs, what are the wants and what are the requirements. For example if you are looking for a specific school boundary, or you need to have the east or west light, or you want to have a CN Tower or Lake view from your downtown condo.
On top of that, a great real estate agent would EDUCATE his/her clients along the way. Analysing the real estate market trends in TOronto’s market, collecting neihgborhood’s trends, providing demographic information to the buyers and such and such.
2.How a real estate agent can help with assessing the pros and cons of each property?
One of the things that you might face is when you shortlist 2 or 3 properties and are looking to narrow down your options to The One. A real estate broker can help you by listing each proeprty’s pros and cons, based on your future usage ( i.e. you see a property that might look great at the first glance, but your kids are gonna grow up in a few years, so you might need the property to have room for expansion, a top Toronto realtor can give you ideas about the future expansion, and those hints may save you extra cost to sell in a few years and move to a bigger place, instead of doing small renos or expanding the current property)
3.Pointing out red flags of a property.
An experienced real estate agent in a vast market like Toronto can point out red flags to you while you see the properties during the showings. An average consumer buys and sell a property 5 times in their life span, but a top real estate agent could do tens of real estate transaction in just one year.
4.How a real estate agent negotiates a deal?
When it comes to purchasing a property, a top agent can negotiate not only the price, but the conditions of the deal too.
Negotiating on the price starts with a CMA ( Comparative Market Analysis), which literally means the appraisal or evaluation of the property that you wanna put an offer on. By analysing the area, and comparables, your realtor will give you an idea of a fair value of the property, thus your real estate agent can protect you from overpaying for a property. Sime times a top Buyer Agent may even get the property with a Cheaper price ( a good deal) for the buyer if he sees an opening in the negotiation process with the seller’s side.
In pricing a property there can be different scenarios, a property may be under listed, or over priced, or fairly priced to sell. In another Article we’d explain about the different methods of pricing.
The conditions of the deal are important, conditions can vary from the closing date, vacant possession, inspections, financing, any repairs if needed, any buy-out of the rental items in the house and similar things.
5.Support until the closing
After the acceptance of the offer, an agent should get in touch with the buyer to make sure the conditions of the contract being met, such as helping the buyer with home inspection, following up with the buyer to get the financing and or mortgage approval done, and inspecting the property again before the closing date to make sure the seller is handing over the property in the same state.
If you are new to the city, or moving to a new neighbourhood, you might wonder who are the reputable movers, what is the utility provider, how to set up your utility accounts. If you are moving to a house from a condo you might have tons of questions, how to take care of the lawn, what if the garage door opener doesn’t work and other concerns that you might have. A great real estate agent would go above and beyond, by continuing the support, even after the closing of the property.
Read More: How to find your perfect Home?
Now that you’ve learned about services a real estate agent can provide for a buyer, it’s time to discuss the seller’s position. Next part is a complete review about what a real estate agent do for a seller:
What does a real estate agent do for a seller?
A real estate agent representing the seller, is briefly called the Listing Agent, has duties to his client ( the seller) and will navigate the process of selling a home. Selling your house can be a stressful process, and in order to manage and deal with the stress when selling your property, you can use the help of a top listing agent. A top real estate agent can help a home seller by: 1. Evaluating your home’s price and doing the CMA 2. Setting the Pricing Strategy 3. Setting the Marketing strategy 4. Preparing the home for sale 5. Setting the strategy and managing the offer presentation 6. Following up to make sure you are gonna have a smooth transition and buyer closes the purchase successfully.
Read more: Listing Strategy
1.Home Price Evaluation or appraisal
The first step to sell your home is to know how much your home is worth. If you simple are wondering “ how much my home is worth? “ you can submit your request in this page in order to get an approximate home valuation.But if you are looking to sell a property, this is what a top listing agent will do for you first. Your real estate agent Agent would evaluate your home’s price by creating a CMA report.CMA stands for Comparative Market Analysis, basically, the listing agent uses comparables, and the features, in addition to other market factors and Indexes to come up with the right price for your home.Evaluating the property based on CMA in most cases needs the listing agent to walk through your property to see the condition of your home.
Actually that’s a great opportunity for both you and your REALTOR® to walk through the home together. While you show your home to the agent, you can serve two purposes, first is that you can show all the upgrades or renovations that you’ve done and can add to or increase the value of your home. Second purpose is that you can also evaluate the listing agent that you are interviewing and decide if you want to hire or not.
2.Setting the pricing strategy ( it really matters, and is not one strategy fits all home sales)
In Toronto’s real estate market, there are various micro markets. Each neighborhood has a different behaviour when it comes to economic factors, supply, demand, and demographics. You may ask yourself if I price my home high to leave room for negotiations? Or should I low price my home to get more attention? The answer is: It depends on the micro market your property is located at. In some markets, pricing low and waiting for multiple offers can be a good strategy, whereas in some markets you have to price it at the market price. Even pricing it high can have backlashes, what if for example your home worth $800,000 but you price it high, in that case you might lose the potential buyers who are pre approved for a mortgage and can not go higher than $800,000 , if they set their limit around or below that number, you’ll lose them by pricing your house high.
3.Setting the marketing strategy
This is another important step that a great listing agent has to come up with marketing strategies that actually work for you type of property, neighbourhood and the area that you are looking to sell. A top listing agent in addition to the above, would define a picture of the potential buyer, and make sure that your property get that exposure too. ( i.e. for a two bedroom condo townhouse near downtown Toronto, a potential buyer image can be a young family, without a kid, or with one kid, professionals, aged between 30 to 40, and so on). Your listing agent should make sure to get the maximum exposure for your property. There are different marketing strategies, from open houses to online to Virtual reality, each marketing strategy has to be curated based on the audience you are targeting.
4.Preparing the home for entering the market ( make it more marketable)
In order to get the top dollar, after planning a property marketing strategy, you have to make your home presentable. It can include staging consultation, de cluttering, painting, small renovations, landscaping and curb appeal, final staging before hitting the market, professional videography, and so on. ( You can read more about it how to make your home more presentable for sale? )
5.Managing offers and offer presentation
Offers when starting to come, can contain different clauses and conditions, which a seasoned real estate agent can explain to you the pros and cons of each clause or condition, and advise which offer can be the better offer, ( the price is not always the only important thing, there might be clauses in the offer that make an offer obsolete.
6.Following up to make sure buyer closes the deal
After you as the Seller, receive an accepted and Firm Agreement of Purchase and Sale, the job is not done yet. You may think that I have sold my house, even though the agreement is firm, a prudent Listing Agent would keep continuing to advise his/her client and follow up the deal to make sure the deal closes successfully, according to the agreement. On top of that a great Listing Agent would do his best to make sure the seller’s transition to their new place happens smoothly.
Read More: How To Find The Best Real Estate Agent?
If I want to sell and buy, should I sell first or buy first? What does a real estate agent do for someone who wants to sell and buy?
If you want to sell your current home and buy a new home,the services that your real estate agent will provide for you is a combination of the above two services, helping you buy and sell. However you might already be wondering which one you shall do first? That’s a great question.
Shall I buy first or sell first? Best real estate agents know that answering to that question is totally depending on the Type of the property and Where about of your current and target micro markets ( where your current home is located, and where do you want to buy in) .
To put it simply, look at the below scenarios:
- You own a house in 905 area, for example, York Region, Richmondhill, and you want to down size to a condo Downtown Toronto and enjoy what the city has to offer. In your case, right now as I write this article, the level of inventory for a Detached house in Richmondhill ( Absorption rate or month of inventory) is around 5 month of inventory. And the MOI in Downtown Toronto, for a Condo apartment is 1.5 Months of inventory. That means the average house in Richmondhill will take longer to sell, than a Condo in downtown. So if you buy your condo first and try to sell your house later, you may face difficulty if you rely on the proceedings of the sale of your house to close your condo purchase. So in this given scenario, it’s better to sell your home first, preferably with a bit longer closing, then buy a Condo in downtown.
- You own a condo downtown, and are in the stage that planning to expand your family and you would need more rooms. You want to sell your condo downtown and buy a house or a townhouse in 905 area. Depending on your target market, your agent shall consult you whether to sell or buy first.
There are different levels of organizations that govern real estate and make sure that it works in ways to protect the consumer.
Read More : Should You Buy Or Sell First ?
A summary of how real estate is organized in Canada and Toronto:
Real Estate in Canada is organized and operates in 3 different levels, CREA ( The Canadian Real Estate Association ) represents the agents in the national and international level. A REALTOR® or a real estate agent working in Ontario has to be registered with Real Estate Council of Ontario. Real estate boards, such as TREB ( Toronto’s Real Estate Board) operate at a local level. A real estate agent in Toronto would be part of TREB, and with access to TREB’s MLS®, the realtors working in Toronto, can list the properties on TREB’s Multiple Listing Service® and benefit from a high exposure.