As a seller’s agent, your success as an individual broker depends largely upon how well you perform your job. Just like any other professional service provider, higher income is typically linked to better performance of services. Like paying your mortgage every month or hiring someone to take care of your business while you are away, being paid to help people buy or sell a house is similar.
As such, it makes sense that the more money agents make, the happier they will be. This can sometimes lead to excessive rewards and benefits, however. For example, some agents enjoy a lifestyle beyond their means, spending extravagantly on flashy cars and expensive homes.
There are several reasons why this may occur for certain individuals, but in general it is because they place a disproportionate value on what they do not seem to appreciate about their jobs. The importance of revenue generation is often overlooked by some real estate professionals.
This article will talk about some ways to improve your career as a sales agent by understanding the important role that payment plays. We will also look at some things that could cost you money if you are not careful.
As mentioned earlier, many real estate agents are not paid for their time while working with buyers or sellers. They are sometimes paid a listing fee which is usually done at the start to get the house listed, then they are paid a percentage of the sale price for bringing in a buyer.
But what most people don’t know about being a realtor is that you are also required by law to be licensed! This means that before you can even consider becoming an agent, You have to take both the licensing test as well as passing the exam given by The National Association Of Realtors (NAR).
This license allows you to use the word “Realtor” after your name and place of business. It doesn’t give you permission to do anything, but it does require you to abide by some rules.
In fact, the NAR requires that every active member agree to work under certain standards. These include things like requiring members to go through training courses, keeping ethical books, etc.
As a seller’s agent, your goal is to get your client to sell their house as quickly and for the best possible price. You can do this by paying attention to the little things that make a difference.
You may be wondering what these are. Here are some examples:
Does the house have good natural light? Are there windows or other sources of sunlight?
Is the yard clearly shown off? Does it look well-maintained and loved?
Are there signs that the owner might not stay in the home for very long? (e.g. Do you see kids moving away because they don’t want to spend time here?)
If necessary, is there enough room for yourself and the children if the family needs to move soon?
Do you feel comfortable going up to the house to meet with the owners? If so, great! But remember, your clients will probably come and go at their own speed, so try to remain patient.
Your job as an agent is to ensure that the property sells as fast and as high as possible, but also that the sale goes through smoothly. This means being aware of potential problems before they arise.
These issues could include: financial, personal, or legal.
As mentioned before, your agent’s fees are not only for paying off mortgages but also for their homeowner’s or renter’s policy. This is an essential part of being a real estate professional- you should know how to handle it.
Agents usually work for brokerages that offer these policies, so ask about what companies they use and which ones are the most trusted. Some may even be able to get you a discount by doing business with them!
There are two main types of coverage in a renters policy: liability and personal property. The former covers things like breaking windows or stabbing with a knife, while the latter includes electronics, furniture, and other large items.
Liability typically costs around $100 per year, whereas personal property can cost up to several thousand dollars depending on the size of the item.
The seller’s agent
As a seller’s agent, your number one responsibility is to make sure that the sale of your home goes as smoothly as possible. You will be responsible for educating the buyers about the house, negotiating the sales contract on their behalf, and then getting them to close on it!
While you can expect to earn a commission from the sellers agent, what many people do not realize is that they also pay an additional fee to have you as their agent. This separate agency cost is called the listing agents’ commission or the listing service charge.
These fees are usually paid at the beginning of the transaction when the seller selects your company as their representative. Some brokers require that these fees be done directly with them while others allow the seller to choose either agency-only broker or direct broker/agent.
The direct broker/agent option allows the seller to speak directly to the individual representing the buyer. This way, they get the most accurate information and representation available. It is up to the individual agents how this structure works beyond those details.
The listing agent
As mentioned earlier, as a seller’s agent you are paid by your client (the seller) to maximize the sale price of their home. This is typically done through advertising and marketing.
As a sellers agent, you will most likely be asked to do at least six things related to selling a house: respond to calls, conduct tours, handle negotiations, find a broker who can help close on the property, prepare the house for showings, and work with the other party (buyer) during the closing process.
Each one of these items pays an average of $100-$500 per transaction depending upon the size of the transaction and how much competition there is for the same real estate. The larger the deal or number of competing agents, the higher pay.
For example, if you are very good at responding to calls then it would probably only take you half an hour to sell your clients house. You get paid according to how many minutes it takes to talk someone into buying, not whether they buy or not!
The buyer may want to see more houses before deciding where to make an offer, in which case you need to spend time preparing the house for showings while also negotiating with the buyers about potential homes that match them.
Closing a sale is also some what dependent upon luck unfortunately. Some brokers require lots of money up front which cuts down on the amount of people you can send to look at a house.
The closing agent
As mentioned before, as a seller’s agent you are paid by the sellers that you represent and sold properties on their behalf. This is typically through paying you an agreed upon commission or a percentage of the sale price depending on what type of listing service they use (traditional open house, virtual tour, etc.).
As a buyer’s agent, you are paid by the buyers that you bring in to your assigned client. This can be done through direct introductions from yourself or others, advertising, flyers, interviews, etc.
The closing agent is usually hired by the lender when a mortgage is involved. They handle all of the paperwork and legal formalities at the end of a transaction which includes recording the property transfer into the system and depositing the money into the appropriate accounts!
The role of the closing agent is not always known because it varies from bank to bank but most have someone who performs this function. Make sure you find out who this person is so that you are prepared for the job!
What people often don’t realize about the title agency is how much they benefit the homeowner. A lot of times there is a one year period where the owner cannot put their home up for sale unless they do something about their current ownership status– take out a loan against the house, sell privately, etc.