Buying or selling a house is difficult, but toss a lazy or incompetent real estate agent into the equation and it could spell disaster. In this article we'll discuss the ways that prospective buyers and sellers should go about looking for an agent and what they should look for before signing a listing contract.

Narrow the List
Call the local real estate sales office, talk to the branch manager and ask who the top selling agent is for the previous year. This doesn't guarantee that this will be the right agent for you, but it might set you on the right path toward finding an experienced individual to represent you and your interests.

Another approach is to ask friends and/or family members, particularly if they've recently sold or purchased a home, if they have anyone that they would recommend. The logic behind using this approach is that someone else (whom you trust) has already had the opportunity to see the person in action.

With either approach the goal is to isolate someone that has shown a certain level of competency. These efforts will help you to avoid incompetent agents and salespeople.

The Interview Process
The most successful agents tend to be well-spoken, intelligent and presentable in appearance. Smart, savvy business people tend to communicate their sales pitch and knowledge more effectively. They also appear to be more organized and efficient. For these reasons buyers and sellers naturally want to do business with them.

Sellers in particular should also seek out agents whose personalities mesh with theirs. This is because in order for a house to sell quickly and at a favorable price, the listing party and the agent must be on the same page in terms of how they are going to market the property, the price that will be set, and how and when the home will be shown. Coordinating these ideas will be much easier if the parties involved get along on a personal level. (For related reading, see Selling Your Home In A Down Market.)

Always ask an agent for references. Good agents should have clients who are willing to attest to their abilities. While it is likely that the agent will only give you the names of people who are likely to say good things about them, take the time to call those people.

You should ask some of the following questions:

  • Was there anything about selling the house through the agent that you didn't like?
  • What could the agent have done better?
  • What was it that convinced you to go with this agent rather than another agent?

Open ended questions such as these tend to elicit candid responses. They will let you know what the agent's strengths and weaknesses are right off the bat.

While there are competent part-time agents that sell real estate, it is imperative to retain a person that has the ability to show your home at varying hours or, if you are a buyer, to take you out to see properties at a time that is convenient for you.

With this in mind, ask the real estate agent when you are first introduced if real estate is a full-time career. Those who work full time tend to take their jobs more seriously, and are generally more flexible when it comes to showing your home.

Find Someone Who Offers Suggestions
Savvy real estate agents know what sells houses in the area, whether it's a pool, office or some other desirable characteristic. To that end they will be able to make suggestions about which rooms or features should be emphasized or de-emphasized.

During the initial interview, ask the agent what he or she would do to sell the home, or if there are any changes that could me made - cosmetic or otherwise - that would make the house more desirable. More often than not, the best agents will make these suggestions without prodding. (For related reading, see Fix It And Flip It: The Value of Remodeling.)

Find an Area Expert
Hire or retain an individual who knows a great deal about the area, such as schools, recreational facilities, information about good and bad areas of town etc. These agents will also be more aware of the typical offering and selling prices than those agents who do not typically work in the vicinity.

One way to find an expert in your area is to ask a local brokerage or your friends or relatives if they know anyone who has sold a large number of homes and/or businesses in the area. Another suggestion is to look through the real estate magazines and see which agents have the most listings in certain areas. (To learn more about selling your home, read Five Things Every Real Estate Investor Should Know.)

Find a Connected Agent
Experienced agents can point their clients in the right direction and help them obtain a lawyer, home inspector and other professionals that will help them seal the deal. Agents that aren't connected tend to leave it to their client to seek out and retain such experts.

With this in mind, be sure to ask the agent if he or she works hand and hand with any other professionals to help close the deal. Experienced and savvy agents will probably offer this information on their own. Also note that some agents may even play up their contacts in their advertising literature. The goal is to find an agent with a web of connections as this will make the entire process of buying and/or selling a home dramatically easier.

One Final Tip
Even if you've retained what you think is an ideal agent, think twice before signing an exclusivity agreement. While your agent might be competent, if you are a seller, the more agents you have that can potentially show and sell your home the better the odds are that you will sell that home. Unless some extenuating circumstances exist, retain a listing agent, but insist that the property be placed on the Multiple Listing Service (MLS).

Bottom Line
In order to close a real estate transaction on a timely basis and on favorable terms it is vital to involve an able real estate agent.

Related Articles
  1. Home & Auto

    5 Luxurious Ways to Boost Your Home's Resale Value

    Not all renovations are created equal. Here are five that are most likely to make a property appreciate (and be appreciated by househunters).
  2. Personal Finance

    The 6 Most Expensive Apartments in New York City

    A look into the high, high, high end of New York City real estate.
  3. Personal Finance

    3 Castles That Cost Less Than a NYC Apartment

    Did you know you can rent an entire château, and that it might cost less than your New York pad?
  4. Home & Auto

    Read This Before Buying a Vacation Home with Friends

    Going in with friends to buy a vacation home will save you on the mortgage and expenses. But if there's conflict, it could end up costing your more.
  5. Investing Basics

    Pros & Cons of Investing in a Condo with Friends

    Buying a beach house or big-city pied-à-terre with friends can save money and make sense, but only if you set it up right. Here's how to avoid trouble. thoroughly research and discuss potential ...
  6. Home & Auto

    The Most Expensive Neighborhoods in London

    Understand what makes London such a desirable place to live and why it is so expensive. Learn about the top five most expensive neighborhoods in London.
  7. Investing

    Costs New Investors in Real Estate Do Not Consider

    As lucrative as real estate investment can be, there are a multitude of costs that new real estate investors must consider.
  8. Retirement

    Retrofitting v. Moving: What's Better for Seniors?

    Should you spend money to make your home senior-friendly or to buy a new place? Personal needs and project size determine which makes more financial sense.
  9. Home & Auto

    The Most Expensive Neighborhoods in San Francisco

    Learn about the city of San Francisco and why rent has increased so much in the past eight years. Discover more about the top five most expensive neighborhoods.
  10. Home & Auto

    The Most Expensive Neighborhoods in Manhattan

    Understand why Manhattan has some of the priciest residential real estate in the world. Learn about the top four most expensive neighborhoods in Manhattan.
  1. Where does the term "always be closing" come from?

    The exact origin of the sales phrase "always be closing" is unknown, but it was newly popularized by its usage in the 1992 ... Read Full Answer >>
  2. What is a fiduciary deed and when is it useful?

    A fiduciary deed is used to transfer property rights in a sale when a fiduciary must act as an executor of the sale on behalf ... Read Full Answer >>
  3. Who manages an escrow account?

    An escrow account is managed by an outside party in order to hold valuables, such as money, property deeds and personal finance ... Read Full Answer >>
  4. What is the difference between capitalization rate and rent?

    Rent and capitalization rate are both factors that determine whether a real estate purchase is a wise investment. Rent is ... Read Full Answer >>
  5. What are some examples of unexpected exclusions in a home insurance policy?

    There are seven general types of home insurance policies under the industry standard Homeowners 2000 Program, ranging from ... Read Full Answer >>
  6. Who are the best-rated home insurance companies in the US?

    Based on consumer surveys, the best company for homeowners insurance in 2014 is Amica Mutual. Present and past insurance ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  2. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  3. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  4. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  5. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  6. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!