As a real estate professional at Chicotsky Real Estate Group, there are few roles more important than representing sellers in a real estate transaction. Acting as a seller’s agent means you are taking on a wide-ranging role with many responsibilities. Getting a listing is just the start; once a listing agreement is signed, a seller’s agent may help their client do everything from preparing their home for sale to conducting a market analysis, creating a selling strategy, and negotiating with buyers (and their agents). This guide will take a closer look at the role of seller’s agent and all that such a job entails.
Establishing Agency
One of the first responsibilities you’ll face as a seller’s agent is to establish an agency relationship with your client. As a real estate licensee, you must be granted the right to act on your client’s behalf. In this case, you’ll make an agreement with your client to act as a seller’s agent, or a real estate licensee who represents the person seeking to sell their property. A seller’s agent, also called a listing agent, is ethically obligated to use their best efforts to sell their client’s property to the best of his or her ability.
An agency relationship is one that the National Association of Realtors urges real estate agents to take seriously. Part of doing so means being honest with all parties involved in a real estate transaction, including your client as well as buyers and other agents or brokers. There are important disclosures that must be made in the process of establishing agency, including any company policies to which you are subject and any compensation you expect to receive for your services. This is especially true if you plan to act as a dual agent, or as an agent for both the buyer and seller in a transaction. These disclosures and your entire listing agreement should be detailed in a contract and signed by you and your client.
Determining Market Value and Listing Price
When you meet with your sellers for the first time, one of the first questions they will probably ask is “how much will my property sell for?” This is an important question, and one that deserves a carefully researched answer, which is why you should come to your first meeting with a client with some information about the current market and what comparable properties are selling for in the area.
While you may need more information before you can settle on a listing price, the more prepared you are in advance, the more likely you will be to secure the listing on the spot. With your knowledge of the property and the market complete, you’ll want to do a thorough comparative market analysis (CMA) and then recommend a listing price for your client. It may be helpful to pool your fellow real estate agents to get a consensus on a listing range before bringing your numbers to your sellers.
It’s important to be honest with your client, but also to respect their wishes. If they are determined to list their property at a price higher than you think it should be, it will be up to you to determine how best to handle the situation. An important part of your role as a seller’s agent will be to manage the expectations of your client while providing them with the information and candor they’ll need to make informed decisions throughout the process.
One valuable resource is the local assessor’s office. Pulling the information for your prospective listing can give you details about the property when the sellers first bought it, what information the property taxes are based on, and perhaps even how the property was listed in the past. With this information in hand, you can make an educated assessment of your client’s property and decide on a fair listing price together.
Gathering Listing Data
In your first meeting with a client, you will want to spend some time going through the property and compiling a detailed profile of its features. Discuss the main selling points with the client, and discuss their reasons and goals for selling.
While you don’t need to gather every tiny detail about the property, there are a few things you need to make sure you know after your first walk-through. These include:
- The location and neighborhood
- The age of the property
- The square footage and layout of rooms
- The number of bedrooms and bathrooms
- The size of the lot
- Property tax records, if available
- Outdoor features, such as a garden or a pool
- Available parking
- Proximity to schools and other amenities
- Freeway and main road access
In addition to the features and amenities of a property, you’ll want to make sure to record the condition of the property, including the level of cleanliness and any obvious damage.
Inspection and Recommendations
A big part of getting a property ready to sell is having it professionally inspected and to make recommendations about maintenance and repairs that would help the sellers get a better price. As the seller’s agent and a real estate professional, it’s important to represent the condition of your listed properties in an ethical manner. It’s also important to understand the intentions of your sellers, and whether they are willing or able to make certain improvements to the property or if they plan to sell it as-is.
As the seller’s agent, you should participate in the home inspection process. Areas of particular interest that an inspection should cover include:
- Foundations – check for cracks and bowed walls
- Wood trim and doors – check for rotten wood and evidence of termites
- Drainage system – make sure water is not pooling along the foundation walls
- Roof – check for missing shingles or other damage
- Windows – check for cracks or other damage
- Plumbing – check that all faucets, drains, and toilets work properly
- Electric system – check that all light fixtures, switches, and outlets work properly
- Appliances – check for age or signs of damage or wear
- Heating and air conditioning system – check that both the furnace and air conditioning unit are functional
- Garage door – check that the door and opener are in good repair and work properly
- Fireplaces – check for built-up soot or other signs of wear
- Interior walls – check wallpaper or paint for signs of damage or wear
Beyond these items, it’s important to assess the general condition of any additional features, such as a swimming pool, fences, sheds, and so on.
Once you have a clear idea of the current state the property, it’s time to make repair recommendations to your sellers. Keep in mind that some items will bring a larger rate of return than others and/or your client may have limited time or funds, so a prioritized list may be something your client will appreciate.
If you encounter a seller who seems resistant to making some improvements, do your best to convince them that your job is to help them to maximize their property value and receive the highest possible price for their home. If you haven’t already, you should cultivate a list of reputable service providers who will deliver high-quality home maintenance and repair services at reasonable prices. You can then make recommendations to your sellers should they need any help getting their home ready to sell.
For those sellers who are willing to make improvements, the repair items at the top of the list should be those that are both relatively inexpensive and will make a big difference in the appearance of the property. Fresh paint, new fixtures, a landscaping clean-up, and matching appliances are generally considered to have a high return for the cost. On the other hand, if there are serious repair issues that will impede your ability to market the property effectively, recommendations should be made to address them as efficiently as possible.
Marketing Strategy
Based on the current market and your client’s goals, your next task is to create and carry out an appropriate marketing strategy. As the seller’s agent, it’s important that you clearly define who the property’s most likely buyer will be and to tailor your marketing approach accordingly.
Perhaps the first and most obvious marketing tool is a “for sale” sign displayed prominently on the property. For each listing, you should also plan to create and distribute sales flyers with a photo and the property’s basic information on it, as well as your photo and contact information. Any listed property will also need a lockbox and a key to the property. Other agents will use this lockbox to access the property for showings, if needed.
Another obvious marketing tool is the internet. Make sure your listing is widely available online. Submitting your listing to the Multiple Listing Service (MLS) is an important first step, but the MLS should not be the only place your listing appears. If you have a professional website or social media accounts, your listings should be posted in these places as well. If you or your brokerage have access to an email mailing list, create an informational email and have it sent out to people who have expressed an interest in similar properties.
Finally, a vital marketing strategy you should never ignore is other agents. Market your listing to real estate agents with flyers, emails, and other communications designed specifically for them. Plan to schedule one or more agent-only tours or open houses, at which you will provide important details that they can then pass on to potential buyers.
No marketing strategy is complete without high-quality, professional photos. Photos go a long way toward creating visual appeal and garnering interest from buyers shopping for properties online. When it comes to expenses, this is one area where the cost is definitely worth it. Poor quality photos, too few photos, or other mistakes may give potential buyers the impression that you’re trying to hide something – or worse, that you don’t value your listing enough to invest in professional photos. To make the most of your listing and to market it in the best possible light, it’s important to create the degree and quality of visibility that internet users have come to expect.
Another closely related subject is the marketing video. Some real estate websites now let you upload a video of the listed property, including a “virtual tour” or 3D walkthrough that interested buyers can view on their computer or device. If you find that you have a high level of buyer activity online, it may be worth the time and effort to create such a promotional video for your listing.
Staging and Showing
Before a video or even photos are taken for your marketing materials, the property must first be cleaned and staged. Broaching the subject of a thorough cleaning may run the risk of offending a seller who isn’t too keen on making improvements to the property before selling, but it’s important to discuss anyway.
One idea is to approach it as part of your listing process. Provide your clients with a cleaning checklist that details each item that should be addressed. Go over it with them, and do your best to help them understand that cleaning is step one in preparing to get top dollar for their home. Once you have allowed a reasonable amount of time for the cleaning to be done, follow up to make sure.
A clean home is now ready to be staged. “Staging” a home means to de-clutter and organize furniture, décor, and other personal property items with the end goal of creating a positive first impression for potential buyers and buyer’s agents. As the seller’s agent, it will be your job to help your client remove any excess furniture and clutter from the home. This will help the rooms feel larger and make it easier for the potential buyer to visualize themselves living in the space. Personal items, photos, and other knickknacks should be packed and stored out of sight, perhaps even in an off-site storage facility, if needed.
At the same time, it’s not a good idea to remove all of the furniture or décor from the rooms. Leaving a few pieces of furniture and some quality accent items will help buyers to picture how their own items will fit in the space, and lend touches of beauty in a strategic way. If the seller doesn’t own any nice pieces or has already vacated the home, consider hiring a professional staging company. These companies will bring in furniture and décor designed to show off each room in its best light. While a professional staging company is an additional cost, many agents have claimed that professional staging results a higher sale price in many cases, so it’s worth considering.
Once the staging is complete, photos and video can then be taken. The photos should match what potential buyers see in your marketing materials, which is why they should be taken after the home is staged.
Now that the home is ready, it’s time to get potential buyers in the door. Showing a listing as a seller’s agent is often more about coordinating with buyer’s agents and your clients than being present for every visit. You will need to work closely with your client to set up an agreeable number of open houses, agent tours, and other events. Although it is more the buyer’s agents who will be involved in showing to individual clients, it is still important not to seem too uninvolved in the process.
Follow up with both the buyer’s agent and your client after each showing, taking careful note of any feedback they provide. If you can, it doesn’t hurt to be on-site for showing to answer any questions the buyers may have and to make sure that your seller’s property is properly secured afterward. As a listing agent, it is your responsibility to make sure that access to the home is carefully managed to avoid unauthorized use or other problems. A good seller’s agent will check the house before a showing to make sure things are ready, and then go back to make sure doors are locked and lights are turned off afterward. If your listing is vacant, it’s also a good idea to keep a watchful eye on the property in the event that something goes wrong.
Negotiating Offers
Perhaps the most thrilling part of being a seller’s agent is when those offers start to come in. This is when all the hard work you and your clients have put into the listing will hopefully pay off. If you’ve done a good job with your listing paperwork, you should already know what your clients are willing to accept as their “bottom line” offer, so you can confidently communicate with them and any potential buyer or agent who submits an offer below what the seller can comfortably accept. As a seller’s agent, it is your responsibility to submit all offers you receive to your client for their consideration. However, it is still in your and your client’s best interest to be prepared to walk away from an offer that doesn’t meet their definition of “reasonable.”
Negotiating the terms of the sale is a big part of your job as a seller’s agent. Coming to the negotiations prepared with a solid understanding of what a valid offer looks like and the most common “asks” for your listing’s price range will help the process go well. Once an offer comes in, you will have a limited amount of time to consult with your client and respond, so it’s important to make negotiations a priority in the moment.
If the proposed terms of the first offer are unacceptable, it’s your job to prepare and submit a counteroffer to the buyer or buyer’s agent. Typical issues that will require a counteroffer include asking for a higher sales price, increasing the size of any earnest money deposit, or negotiating who will pay for certain reports or fees. Other common reasons to prepare a counteroffer may be needing a different closing date, excluding or adding personal property to the deal, or adding other amendments. It may also be necessary to prepare a counteroffer to simply current a buyer’s agent’s mistake.
The number of counteroffers you’ll prepare varies from situation to situation, but as the seller’s agent it will be your job to not let the negotiations drag on too long. If you sense the situation isn’t going to end well for your client, you may encourage them to let the counteroffer expire or to reject it outright, as required by state law.
Some buyers or buyer’s agents will try using pressure strategies to get more than your clients are willing to give. Sometimes, this will take the form of buyers or their agents making small requests that seem reasonable at first, but then don’t ever seem to end. Entertaining a request or two isn’t unheard of, but at some point you will need to put a stop to it with a firm “no.” Discussing this potential scenario with your client beforehand may help you know exactly when that point has been reached.
Another common strategy is where a buyer will claim they could definitely buy your seller’s house “if only” a particular difficulty (say, the full down payment or closing costs) was removed. It is important not to let your buyer’s problems become your own, or even worse, your client’s problem. Address the issue firmly and logically, keeping your client from being saddled with unnecessary conditions.
Dealing with multiple offers or counteroffers at once can get very complicated in a hurry. While a bidding war may mean a higher sales price in the end, you will need to keep careful track of dates, times, and paperwork throughout the process to ensure that no mistakes are made before a final agreement is reached.
Overseeing Home Inspection and Appraisal
Once you get a firm “yes” from both buyer and seller, the closing process can begin. On your end of things, this will include an official home inspection and appraisal for the mortgage company. As a listing agent, it is a good idea to attend both the home inspection and the appraisal if at all possible. Being present at the inspection will enable you to keep track of everything the inspector has to say, and as the saying goes, knowledge is power. You may be able to use the information you get from the home inspector during the negotiation process, so it’s a valuable use of your time.
At this point, don’t be surprised if the buyer or buyer’s agent attempts to renegotiate the home’s purchase price to account for the cost of any necessary repairs. If the contract states the buyer has agreed to the home “as is,” your client is not legally bound to make any repairs. But if the problem is big enough and your client can’t or won’t fix it, the buyer may decide to back out of the deal altogether. As you can see, if there are repairs that need to be made, if you were present at the home inspection you will know immediately and can help your client decide what to do about it.
Similarly, attending the home appraisal will enable you to answer any questions the appraiser might have and help them to understand the condition of the house, including any recent updates the seller has made, and more. This can have a measurable effect on the appraisal value, something that will directly benefit you and your client.
Guide To/Through Closing
Closing on a real estate transaction can seem like a confusing, lengthy minefield for both the buyer and the seller. While it’s true that there are numerous hurdles to be overcome, the key to a smooth closing experience for all parties is good communication and preparation. While it is up to the buyer to do most of the legwork when arranging their financing, as the seller’s agent you can help speed the process along by keeping tabs on their progress and keeping your client in the loop.
There are a few things you will need to help your client do in preparation for the closing date. They will need to complete any repairs or fulfill any pre-closing terms agreed to during the negotiation of the purchase agreement. You can help them to stay on schedule for this part by making recommendations and checking on their progress. Your client will also need to hire a title company and obtain accurate payoff information on their existing mortgage(s), if any. While the title company will contribute a lot to coordinating things from this point forward, staying in contact with them and your client is an important part of guiding them through to the final closing.
If the buyers have their financing in order, the closing process should be a fairly straightforward affair. All parties will need to provide the required documents and signatures, which may or may not happen all at once or in the same room together. A good seller’s agent should make an effort to attend the closing and congratulate both their client and the buyer on a successful sale. Engendering goodwill from all parties is a great way to make a lasting impression and keep those word-of-mouth referrals coming towards Chicotsky Real Estate Group. We take great pride in treating our clients like gold and are thankful for all of our clients who refer us their friends and family. Call our realtor today for more information.
