Submitted by AMY DuBOSE
San Marcos Area Board of REALTORS®
There are some misperceptions out there – beliefs about the real estate business that could affect your decisions when buying or selling a home. I’d like to clear up some of the most widely held misperceptions about how real estate really works.
There is no standard commission
This is a big one. Despite media claims about “standard commissions,” there is no such thing. Every firm and agent determines their own rates. Many charge a commission based on the sales price; others offer a flat fee for a specific list of services; still others offer a menu of services that consumers can select from with prices corresponding to each service.
Some may argue that several firms in an area all charge about the same amount. That may be true, just like you often pay about the same price for the same level of service and expertise no matter which lawyer you hire or which gas station you frequent or which electronics store you select to purchase your TV. Nevertheless, in real estate, you will find wide variations, from firms that provide a bare-minimum of service for a low price to a brokerage that charges more than everyone else and markets themselves as being worth every penny.
Agents are not forced by law to offer “full service”
In 2005, the Texas Legislature passed a law requiring some very minimal services to be provided by any licensed real estate agent representing a client. Somehow, this legislation was characterized by some as a requirement to offer “full service” to clients who may not need it or want to pay for it. You need only look at some of the limited-service brokerages operating in Texas today to see that no one is being forced to purchase “full service.” There are some brokerages in Texas advertising that they will list your property for less than $200. You would probably expect some very limited service at that price, and my guess is that you’d be right.
But the Legislature felt that, even with limited services, there are some basic things that every client should expect. In a nutshell, a broker must accept and pass along offers and counteroffers to his client, help his client develop and present offers and counteroffers, and answer the client’s questions relating to offers and counteroffers. Personally, I can’t imagine anyone thinking that a licensed professional should be required to do any less.
Not all real estate agents are Realtors
Many people don’t know the difference between a real estate agent and a Realtor. The terms are not synonymous. A real estate agent is someone who is licensed by the state of Texas to represent clients in real estate transactions. A Realtor, however, is a real estate agent who has joined the Realtor association, a voluntary professional membership organization with national, state, and local chapters.
In addition to complying with state laws, Realtors also pledge to abide by a strict Code of Ethics. Realtors also have resources available to them that non-Realtors cannot use—like additional forms beyond the basic contracts that can help clients protect themselves in real estate transactions.
A quick sale should be celebrated
I have a hard time believing this, but some homeowners actually seem upset when their home sells quickly. The reasoning goes something like this: Since the home sold so soon after it went on the market, the agent didn’t have to do much work, and therefore didn’t really earn his fee on the sale.
I wonder if those people would be more satisfied — given the same eventual sales price — if their home sat on the market for several months first. The point is that it takes preparation, hard work, and expertise to prepare a home for market so it will sell quickly. Most homeowners would like a speedy sale at their target selling price rather than a drawn-out period of showing the home, keeping it spotless, leaving the house when prospects show up, not to mention the stress of not knowing how long until you can get on with your life plans.
There’s more to dispelling this particular misperception, too. Getting a signed contract on a home quickly is definitely desirable. But a Realtor’s work does not end there. A skilled Realtor handles dozens of details and watches carefully to make sure a transaction is seen through to the end with minimal difficulty and hassle for his client.
Rely on your Texas Realtor
Now you know the truth about some misunderstood aspects of the real estate industry. Your Texas Realtor can help you sift through other relevant information—and believe me, there’s a lot of it—to help you make good decisions about the sale or purchase of a home.
For more information about buying or selling real estate in the Lone Star State, I invite you to visit TexasRealEstate.com.Email | Print