Shopping for a home can be a stressful, time-consuming process. But it doesn’t have to be. A knowledgeable real estate agent can help ease the burdens of homebuying and give you a seamless experience. Along with working with a loan originator and getting pre-approved, using a real estate agent can speed up the homebuying and financing process.
But do you need a real estate agent to buy a house? Working with an agent provides many benefits as they can help you save time, money and negotiate strategically on your behalf. While a real estate agent may not be required, if you aren’t currently working with one, here’s what you should consider!
Pros and cons of real estate agents
A study conducted by the National Association of Realtors (NAR) estimates that 88% of homebuyers opt to work with a real estate agent to help them navigate the ins-and-outs of the homebuying process. While you may want to consider taking the time to do your own market research as you begin your search, there are a lot of benefits to working with an agent as you get further into homebuying.
There are pros and cons to working with a real estate agent, so if you’re on the fence about working with one, here is some insight to help you decide what’s best for you:
- Experience — Finding an experienced and knowledgeable real estate agent can be a huge asset in reducing your workload and stress as you search for a home. They can help you spot red flags in properties and understand the local market, so you’ll know you aren’t being overpriced by sellers.
- Market knowledge and networking — Don’t underestimate the value of having an expert at your disposal. A good real estate agent can inform you on location statistics like commute time, school districts, crime rates, and any commercial real estate developments that might impact your standard of living. Plus, they’ll have a network of real estate professionals to help with the appraisals and inspections.
- Commitment — Your agent will be on your side throughout the whole process. They’ll take the time to get to know you and what you’re looking for in a home. Once you find a home, real estate agents know how to frame requests for sellers and negotiate based on specific property defects. Negotiating is their expertise and allowing them to be your advocate will get you the best possible deal.
- Money — Buying a home can be expensive. You’ll have to consider how big of a down payment you can afford, plus other closing costs and fees. And a con of working with a real estate agent is, well, paying for their services. Often times, the seller’s agent and a buyer’s agent’s commissions are wrapped into the overall sale price of the home.
- No such thing as “perfect” — Ideally, you’ll want to take time to interview and vet prospective agents before hiring one you trust. You’ll want to work with an agent whose value and services are able to provide what you’re looking for. It’s not typically difficult to find an agent who understands your property wish list, but if you end up hiring the wrong real estate agent, you may face a series of setbacks and challenges.
What does a real estate agent do for buyers?
You may have heard of the term “buyer’s agent” — essentially, this term refers to real estate professionals who represent the buyer during the homebuying journey. They can represent more than one client at a time but are legally obligated to protect the interests of their clients. Perhaps even more importantly, a good real estate agent will have the negotiation skills to advocate for their client and get them the best deal possible. If you choose to hire a real estate agent/buyer’s agent, here’s what you can expect them to do for you:
- Find homes and schedule viewings
- Submit offers to listing agents
- Negotiate favorable purchase contracts
- Manage your paperwork, including mortgage application, pre-approval letter, disclosure statement, offer letters, purchase agreement, purchase and sale agreement, home inspection reports, title paperwork, etc…
- Recommend other real estate professionals (i.e., home inspectors, attorneys, movers, etc…)
Finding the best real estate agent for you does not happen overnight. And because it can be critical to your success in finding a home, we have developed a guide to walk you through the process. Here are a few steps you can take to get started:
- Search locally
- Research agents online
- Ask your network for referrals
- Take the time to interview multiple prospects
- Always check the reviews and referrals from other clients/homeowners
Risks of buying a house without a real estate agent
Buying a home is an incredibly big deal and may be the most significant transaction you make in your life. If you’re not careful, it could turn into a financial pitfall. While you can technically buy a home without an agent, it could be a huge financial risk.
You won’t have access to the local market ins-and-outs or know if you’re overpaying for a home. You may run into inspection problems when you get the report if you don’t know how to decipher it. Not to mention, they are professional negotiators! Without an agent, you may not have to the know-how to get the best deal and most favorable terms.
It's vital to remember that real estate agents are licensed professionals. It is their job to help you navigate the real estate market and ensure you’re making the best choice in property for your situation.
Take your time thoroughly interviewing real estate agents and be sure to consider all of your options as you dive into the search for a new home.