Why Realtors Are More Important Than Ever

Smiling Shark


When it comes to looking for a Realtor everyone is searching for the same thing. The Realtor must have the knowledge that equals or exceeds everyone who has lived in every house in every neighborhood that the Realtor lists and sells in, the negotiating skills of the Secretary of State and the wisdom of Solomon to help you decide which home is right for you!

Seriously though, how do you find your Realtor?   You can ask friends and relatives for recommendations, read online reviews, ask for references or even make your decision based on who’s headshot you like the most (I kid you not). But at some point you’re probably going to ask yourself “do I really need a Realtor at all?” After all you can go to Trulia / Zillow and get all the “facts and information” you want right of what’s available, right? Without having to answer all sorts of pesky questions like “have you been pre approved for a mortgage yet or do you have proof of fund?” (Since getting a contract signed without mortgage preapproval or proof of funds is about as rare as hen’s teeth.) Or, what’s really a deal breaker for you to have in your new home and what’s merely on the “gee, it would be nice list”?

Litigation presently pending alleges among other things that “Notwithstanding express notice, Zillow does not remove all of the ‘SOLD’ listings from its site, although it does remove the listing agent or broker’s name once the property is sold,” and “Instead, Zillow continues to display many of the SOLD listings with the accompanying photographs in an apparent effort to drive further Web traffic to its site and to sell more ads.”   That’s right, those sites you’ve been depending on aren’t there to help you find your new home, they’re there to sell advertising space.

So that takes me back to the original premise- Why Realtors are more important than ever.   Over 93% of homebuyers used a Realtor last year up from 70% in 2001. So it doesn’t look like we’re headed the way of the traditional travel agent or the dodo bird anytime in the near future! As real estate transactions become more complicated, the consequences of not having a professional real estate practitioner on your side when purchasing something as important as your home can lead to devastating economic as well as emotional consequences.

There is a branch of economics called “transaction cost economics”. Without boring you with theories and lines of equations let me boil it down to a few sentences. Transaction cost economics explains that life in general is simpler without intermediaries inserting themselves into a transaction. The more commonplace and mundane a transaction is, the less need there is for a middleman. You can book a flight on JetBlue from Fort Lauderdale to New York for $89 with just a few clicks of your mouse. On the other hand, infrequent, highly emotional and costly purchases like buying your new home require the solid expertise and guidance an impartial expert can impart. There’s a good reason why the people in the C Suite hire professionals to manage their lives. Take a page from their playbook. As a Buyer, using a Realtor costs you nothing.  Contrary to popular belief, people who buy FSBOs generally pay 5.9-7.7% more than those working with a Realtor. As a Seller, your net profit is higher and you only pay when the house sells. Whether you choose to heed your Realtor’s advice is up to you, but not listening to it can cost you dearly.
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