5 Questions to ask a Realtor in an Interview
Selling a home is one of the most important financial decisions a person makes during their lifetime, even if they make it multiple times. A good Realtor can make the experience stress free and enjoyable (or as enjoyable as possible) and financially rewarding. But how do you know if a Realtor will perform, how do you know if they are a good fit?
Questions to ask a Realtor during an interview:
1. What are the exact terms of your cancellation policy?
Okay, so maybe you didn’t expect this to be the first question. But honestly I think it should be. Let’s say you went through the interview process and the real estate agent told you everything you wanted to hear – but later you found out they actually don’t do what they promised or they are not nearly as successful as they led themselves on to be. Your home is not selling either because the agent’s plan didn’t work, they failed to implement their plan, or they gave the wrong advice to being with. Suddenly you find yourself reading that listing contract that you had browsed quickly over, looking for the cancellation policy.
Bad news here. Most Realtor’s contracts don’t let you go. Sure they might let you take the home down off the websites, but you have to wait out the entire term, be it 90 days or six months, before you can list your home yourself or with another Realtor. Basically, you can’t sell it. On top of that, some Realtor’s contracts have additional hooks like fees you have to pay out of pocket to cancel, or demands for commission if a buyer that saw the house when it was listed with them comes back around later. Be careful and ask this #1 interview question of your Realtor!
Example: all our listing contracts are cancel anytime, no charge, with 24 hours notice. The form of cancellation can be an email or letter. The only time our clients cannot cancel is when they are currently pending, in contract to sell the house to a buyer (multi-party agreement). The client can cancel before or after that (in the event of a sale fail).
2. What is your Commission rate? Does it vary for any reason? Do you charge any additional fees?
Let’s be upfront. Many real estate agents like to avoid talking about the real estate commission. They think if they can get on your side and develop a friendly relationship, then they can write in 6% commission without an argument. It’s all nice and good to be friendly, but this is a service industry. The Realtor is at your home to serve you, represent your interests, and sell your home for the best possible price – all for a commission. No reason to beat around the bush.
The second part of question #2 is very important. If the commission never varies for any reason that means the real estate agent has incentive to make the most amount of money off you as possible. For example, in our area the majority rate offered (the rate offered more than any other rate) to buyer’s agents is 2.5% of the sales price. A 6% listing agent would get 3.5% and a buyer’s agent 2.5% to make the total six percent. However, let’s say a buyer reaches out to the seller’s agent and asks them to write up an offer for them (dual representation). Suddenly that seller’s agent could be making 6% – all for themselves. This would be true as well if say one of your family members decided they wanted to make an offer on your house and didn’t have their own buyer’s agent. It also happens (at times) that buyers self represent, we’ve seen lawyers do this, as well as investors, and former ex – real estate agents. Many Realtors contracts have them receiving the full amount of commission be it 6%, 5%, 4% – whatever it might be – regardless of any set of circumstances – when there is no buyer’s agent to pay. (Please note all real estate commissions are negotiable in this country.)
Example: we charge a max. of 4.5%. The seller’s agents gets 2% commission and the buyer’s agent gets 2.5%. If we sell it in-house (one of our team members is the buyer’s agent) then it automatically drops to 4.25%. If there is no buyers agent and the sellers agent represents the buyer (dual agency with permission from the seller) the commission automatically drops to 3% total. If the buyer self represents, the commission automatically drops to 2% total and only the seller has representation.
3. How will you market my home so it sells for top dollar?
- Who will take the photos?
- Let’s hope it is not the Realtor or one of their friends! Might as well get the name of the company they are going to use. Professional photography sells homes and research proves it. Keep in mind, there are typically two levels of professional photography in the industry now – regular and luxury / commercial. Regular professional photos typically cost the Realtor $150 – $300 and luxury or commercial can cost a lot more, even thousands. For the vast majority of homes, regular professional photography is more than enough.
- Will there be a 3D tour? What kind?
- 3D tours are no longer optional, in my opinion. The post COVID19 world demands it. There are many home buyers looking to tour the home virtually first – before ever seeing it in person. We often get over a hundred buyer 3D virtual tours in a listing – a day. Don’t let the real estate agent tell you there will be a “virtual tour” – some nonsense of pictures slides to awful music. No, what real 3D tour will they provide? Will it be Matterport, Ricoh HD, or Zillow 3D (to name some major players)? Will you be able to access the 3D tour from every major site (Zillow, Realtor.com, Redfin, etc.)? Too many Realtors provide videos or 3D tours but only put them on select sites, failing to make them available to the vast majority of home buyers. You’ll notice I didn’t ask if the Realtor will provide a video. Videos are nice, but they don’t give the buyer control online. 3D tours are the most effective option in showing the flow or layout of the home and give the buyer total control. 3D tours are the new standard for home sales.
- Will there be a 8ft. yard sign with permaflyer / flyers?
- A cheap small sign in front of your home looks bad. You might be surprised to know that yard signs still have some effect on home sales. Around 3-4% of homes each year still sell due to the buyer finding the sign in the yard. It is not a huge number, but it’s something. Also will the Realtor stock it with flyers, or even better yet, install a beautiful permanent flyer? Again in post COVID19 world and in the world of cell phones, a permanent flyer with online access is more desirable to most home buyers than a paper flyer.
- What MLS system(s) will you put my home on?
- Most Realtors will put your home on one local MLS (multiple listing service) system that will syndicate your listing to Zillow, Redfin, Realtor.com, and thousands of other real estate sites. The local MLS is also what is prominently used by the buyers agents in your area who likely pay a membership fee to use the MLS and are trained to use it to help their buying clients find their next home. The MLS is very important. So important we pay extra to put all of our homes for sale in Oregon and Washington on more than one MLS. This helps us reach all or virtually all the licensed agents in each state that might have a buyer for your home. It meets the agent on the platform they use and prefer.
- Will you pay extra on any of the top sites (Zillow, Realtor.com, etc.) to feature my home above other listings?
- Most likely the real estate agent’s answer will be no. The most common answer is your home will be on all the major and minor real estate websites (because they are putting your home in one MLS). Most Realtors will not talk about the option they have to pay extra to major portals like Zillow (Zillow has about a 36% market share of all home buyer traffic online) because they don’t want to do it. We pay extra to Zillow, Realtor.com, Homes.com, and more for our homes to be seen higher and more often online. This causes our client’s homes to sell faster and for more – period.
- Will you have open houses? If so, how many? If not, why not?
- Open houses sell homes about 3-4% of the time nationally. It is not as big a home selling factor as many in the public would believe, but it still has some effect. Typically the higher the price tag the less likely the seller and the Realtor will want to hold an open house – and for good reason. Higher end buyers expect to make an appointment anyway and open houses are a liability. Realtors have no control over who comes in during an open house – it is open to the general public. Typically in all other circumstances Realtors know exactly who is coming and when and why.
- Will you host a brokers open? Is so, when? If not, why not?
- Brokers opens are effective, but only in certain areas and not others. In some neighborhoods there is a tradition of agents touring homes (typically on a set day and time of the week) and if that tradition exists in your neighborhood – it can bring a lot of agents through. But if Broker’s tours are not common in your area, your selling Realtor can invite all the agents he or she wants, but typically almost no one or no one will show. It is based on the existence or non-existence of local tradition.
- Is now a good market season to sell or should I wait?
- Most real estate agents are trained to answer that question in a way that encourages you to sell your home right now, regardless of market conditions. A good Realtor will let you know when the best time of year to sell is and when the worst time of year to sell is. We write reports on this annually and since 2003, it follows nearly the exact pattern every year. Certain months are always best, certain months are always worst. Homes sell every month of the year, but if you are free to choose, some are always better than others.
Additional Questions for Luxury / Specialty Homes:
- Will the home be listed for sale globally? If so, where and how?
- For example, all three major Oregon MLS systems do not syndicate globally. We have to hire and pay a third party provider to take the home and push it out to every developed country in the world, to place the home on the absolute top real estate websites used in each country and to translating the home’s description into each local language. This can have a sizable impact on the sale. Keep in mind, just the mere fact that the Realty company the Realtor might be with is an international company, does not mean your home will be advertised or shared globally. Most large Realty companies operate as a franchise and so local real estate agents often do not have access to any of the other franchise agents outside their small city office (their franchise owner’s location). Sharing a logo seems to be the majority of the connection within many national Realty brands.
- Will there be a brochure and if so will the information be accessible on the top sites (Zillow, Realtor.com, etc.)?
- Having a nice brochure, no matter how big or shiny, on the kitchen counter does next to nothing. The buyer needs to have access to all of your home’s information on the website of their choice (Zillow, etc.). Home brochures are important for those properties that have a bigger story to convey than the local MLS space allows for. We have a method of creating and displaying beautiful PDF presentations, accessible from every major real estate portal. If your home has a big story to tell, then your Realtor needs to explain how he or she will get that full story on Zillow (and all other major sites).
- Will there be a drone video / photos?
- I do not believe every home needs a drone video or drone photos. But if your home has an exceptional view or a larger lot, then it could be a really impacting part of your home’s presentation.
- Will you pay for staging or interior design consultation?
- Interior design consultation to work with what the seller already has or plans to do in remodeling, can be crucial to preparing the home for sale, but not every seller needs or wants the assistance. Staging vacant homes can help certain types of properties sell faster, but isn’t advisable for others. Smaller homes or small rooms, for example, can show bigger and better simply by being clean and vacant.
4. What’s your sales record? When were you licensed? How many agents are in your local franchise?
Verify the information. Most real estate agents say they have tons of experience in your area. Saying it is one thing, seeing the data is another. Go to Zillow.com and click Agent Finder. Then put in their name and the city your Realtor is working in. Review the agent’s profile. Zillow will show you how many recent sales the agents has and their total lifetime sales toward the bottom. It is a great tool. If it is a team profile on Zillow, just look at the agent your considering. When it is not clear on Zillow, ask the Realtor for proof by email – they can send you a report of their sales from their local Realty company or MLS.
Verify the license. You can verify a Realtor’s license in Oregon (called Broker and Principal Broker) on this site. You can verify a Realtor’s license in Washington (called a Broker and Managing Broker) on this site.
Verify the network. A real estate agent can say they are part of the largest Realty company in the nation or world, but what effect will that have on your sale if they are in a franchise model company? Very little to none, in my experience. Ask instead, how many agents are in your local franchise office? Or if the Realtor is part of a non-franchise Realty company, the same question applies; how many agents are in your non-franchise company? Now sure, all Realtors work together to sell all the homes in the state they are licensed in. This is true. However, there is always bump in effort within that real estate agent’s own non-franchise company.
5. What are the seller side closing costs in my area?
State to state, county to county, city to city, the seller side of closing costs will change. Typically the seller is paying half of escrow and a portion or all of the title insurance, but you could also be paying state or county taxes or fees. Your local Realtor should be able to explain the full cost to you of any home sale, and it will be different from region to region.
6. Questions to Avoid
- Will you post my home on social media?
- The National Association of Realtors puts out regular annual reports on what makes a home sell across the county – down to a percentage point. I purchase and read these reports every year. So far social media does not sell homes. The number of “fans” a Realtor or Realty company has on their social media accounts does not translate into your home selling. At least not yet, not by any found research.
- Will you mail postcards or hand out flyers about my home?
- This is another example of an advertising effort that is not supported by research. Mailers do not sell homes. For that matter neither does magazine advertisements, TV, or radio ads.
- Will you hold an open house every weekend?
- Do you want to look like a desperate seller? Host an open every weekend. In my experience is isn’t a good move for the home sale. Open houses do help some homes sell, but it is a minority effort (per all the available research) and repeating it over and over does not produce better results.
- Will you email, mail, or phone blast other Realtors in my area?
- This is often talked about by real estate agents, but does nothing to sell homes. Realtor use the MLS they are a member of to search for their client’s next home purchase. That’s it. They are not effected by blasted mailers, calls, or emails (other than by being annoyed by them). Realtors use the MLS they are paying for and trained on to find homes for their clients. That is why we pay to list our clients homes on multiple MLS systems – the more the better.
7. Valid Reasons to Choosing one Realtor over another.
- They provide the service you want for a price you’re willing to pay.
- They have a proven sales record and verified reviews.
- Their researched marketing plan will get the highest price for your home.
- They have experience in the local industry and give solid advice.
Typically not valid reasons for choosing a Realtor
- They told me the highest price for my home.
- This is a strategy used by some agents. They come into the house being the most excited about it and promise the highest price tag, but also make sure to have a seller’s contract that locks the client in, so when the seller is finally forced to come down in price they are still forced to work with that same agent.
- My friend or family member referred them.
- Okay, this can be a good reason, but be careful. Just because an agent got luck in one successful home sale doesn’t necessarily mean they have a proven track record.
- The Realtor is a friend or family member.
- Mixing business and friendship isn’t always the best choice. This is one of the largest financial assets for the majority of the public. The assumption that all real estate agents are the same and provide the same basic service – couldn’t be more wrong. Choosing the wrong agent can cost you thousands, even tens of thousands, in a potential home sales price tag.
Located in Oregon or Washington?
My team would love to set up a Realtor interview with you. Contact us today and ask your questions – we are ready!June 26, 2020