How to Select a Real Estate Agent

How to select a real estate agent? While it’s true the real estate industry has its share of true professionals – dedicated men and women that provide superior, value-added service to their clients, it’s also true that it has its share of those that fall short of this mark.

Given that your home is typically the largest, most valuable asset you own, it certainly makes sense to entrust the purchase or sale of that home to someone that is truly an expert in the dynamic, complex process of buying and selling real estate.

At Professional One Real Estate, we have a solid understanding of what makes a solid real estate agent. Below is some advice you can follow to ensure you hire a true real estate professional.

And not only that, but we’ve created a free download specifically designed to help you with this process–The 16 Questions You Must Ask Your Next Real Estate Agent–which you can receive immediately by just clicking below the image to your right. That Guide is our gift to you.

The bottom line: whether you use our resources or some other method, you must be sure to select a quality professional to help you with the buying and selling process. We know how much it matters to have top-notch representation – and how much it can hurt you when you don’t.

when selling a home or buying a home, these are the "16 questions your must ask your next real estate agent"
Your home is too valuable to risk representation by the wrong agent. Learn how to find the right agent! Get your free download >

 General Advice

While “local knowledge” is certainly a good thing, do not select a real estate agent just because they purport to be “the neighborhood expert.”

So much good data and information is available to the typical real estate agent that neighborhood specific information is not critical to successfully selling a given home. Obviously, the more the agent knows about the subject property and its immediate surroundings, the better.

But what separates a good real estate agent from a great real estate agent are the intangibles: knowing how to properly price a home, how to properly market a home and how to skillfully negotiate a successful sale. An agent that possesses these attributes can work in any area, as long as they have access to the applicable comparables data. When evaluating two otherwise equal agents neighborhood familiarity may be the factor to tip the scale in favor of one agent over the other. See further discussion of this overall point at Four Myths.

Professional One agents have the expertise to successfully market and sell homes throughout the Metro Detroit Michigan area, and our knowledge of the Canton, Novi, Northville, Livonia, Farmington Hills and Plymouth real estate markets cannot be beat!

Do not utilize the services of someone that is not a full-time practitioner.

Your home is likely your most valuable asset. Why would you entrust this to someone that is not fully committed to the business of buying and selling homes? Would you use a part-time builder to build your dream home? Would you use a part-time surgeon to perform a surgery?

Don’t be impressed because an agent claims to sell all of his or her listings quickly.

This may simply be an indication that the agent under-prices their listings, which is the last thing that you would want your agent to do.

Don’t be impressed because an agent claims to sell hundreds of homes every year.

This is a business where quality of service is far more important that quantity of service. There is positively, absolutely a limit to the number of transactions a real estate agent can do in a given year before quality of service suffers. To use another analogy, would you be impressed by a neurosurgeon that claimed to perform “500 surgeries last year”? A better choice would be the professional that performed 50 surgeries PROFESSIONALLY and COMPETENTLY than the person that did 500 quickly. While you may scoff at this analogy, please remember this: the difference between a good real estate agent and a great real estate agent can often be measured in thousands, or tens of thousands, of dollars in your bank account. You WANT an agent that is fully focused on your specific situation at all times. When agents take on more than they can handle the quality of the service they provide suffers to your detriment.

 General Questions to Ask

Following are general questions you should ask when interviewing a prospective real estate agent. Click on the item and what we believe is the best answer will appear below.

What percentage of your total business comes from repeat clients?

This is one of the most important questions to ask. The hard part is being able to substantiate what an agent tells you. Read “May I have a detailed list of your sales within the last few years?” below for further discussion related to this point.

Do you guarantee your services?

As of the date of this web site update, Professional One Real Estate is the ONLY company of which we are aware that literally guarantees its work. Any client can rescind any contractual relationship with us at any time, for any reason. This is not to suggest that other companies or individual agents that do not provide such a guarantee are inferior. But with which philosophy would you be more comfortable working?

May I rescind your listing agreement if I am not satisfied with the quality of your service?

When listing your home, virtually all Realtors require you to sign a listing contract. One of the terms specified within this listing contract is the duration of the listing. Most agents try to get you to agree to the longest possible listing term, for obvious reasons: the longer the term, the more likely that your home will sell. But what happens if, 30 days into a 90 day listing contract, you discover that the agent is not doing what they promised? You owe it to yourself to ask this hard question, straight up. If the agent says, “sorry, but you signed a contract,” that tells you a lot about their character. Our philosophy is that we really, sincerely want you to be happy. If you aren’t happy with us, then, by all means, please seek the services of another professional.

May I have a detailed list of your sales within the last few years?

Most agents tell you how much real estate they’ve sold recently without a lot of prompting. This is logical, as past success is frequently a good predictor of future success. If your potential agent does not volunteer this information, just ask. When they respond, ask for a detailed report that lists the individual transactions that support the total that they mentioned.

Once you obtain this report, do the following:

See if the total sales per this report equals the sales they disclose in their advertising, if applicable. If it does not, then you should be very wary of the integrity of this agent.

Randomly select five or six transactions from the report and do the following:

Obtain contact information for the agent’s client. Contact that party and ask the following questions: Did the agent perform satisfactorily? Would they recommend the agent to their friends and family?

Ask the agent to highlight all of the transactions in which a client was utilizing the agent’s services for more than the first time. Contact several of those people to confirm that they really are repeat clients. What you are trying to do here is ascertain the percentage of the agent’s business that comes from repeat clients. The higher the percentage, the better, as the best measure of agent quality is people coming back and using that agent again and again.

Many of the “marketing specialists” mentioned within this page get the majority of their business via mass mailings, billboard advertising and other marketing techniques that draw in clients from the sheer volume of their correspondence to the general public. These are precisely the people that you want to avoid.

If the agent provides you a list of references, do not call those references. Obviously, the agent would not provide you the names and numbers of people that are going to say anything negative about him or her.

Can you show me how you prepared the CMA for my property?

This is a great way to separate the “listing specialist” from the real agent. Many of the top-producers in the industry are nothing more than “listing presentation specialists” that know how to charm you with a great listing presentation. But the reality is that most of these agents have no idea how to even navigate their way around, which is the database that all realtors use to obtain information about real estate in this market. It is the source of virtually all the “comparables” data that every Realtor uses. A good agent will be able to walk you through, step by step, the process of preparing a “CMA” (Comparative Market Analysis), which is the tool that agents use to determine the market value of any home. If the agent cannot do this quickly and easily, the red flags should go up that this agent is not a Realtor, but rather a marketing specialist. Marketing specialists rely on others to do their research for them, because they lack the knowledge to do this incredibly vital, fundamental part of the process themselves. This harkens to a quote from a former colleague at a different company that made the following remark to one of our agents: “I don’t know about you, but the last thing on earth I want to be is a Realtor. I have no idea how to operate a computer, let alone That’s why I have assistants that will do that stuff for $9 an hour.” This agent sold more than $20 million last year. Imagine if you hired an attorney at $250 per hour, and then found out that that attorney was handing your case off to someone that he was paying $9 per hour to actually do the work for him or her. Would that upset you? It should…

Would you please show me your "Inventory" report?

This is a report that shows all activity for a given Realtor, including active listings, sales, pending sales, listings that have expired, and listings that have been withdrawn. Ask the Realtor for contact information for several of the listings that were withdrawn or that expired. Contact those people and find out what went wrong. In all fairness, this is in some respects a “loaded question” type situation. Obviously, when people fail to deliver in any area of life, the party that was not satisfied will typically not say good things about the party that failed to satisfy. However, here is the purpose of this exercise: there is a radical difference between someone saying “they worked hard but they just couldn’t sell my home” and someone saying “the person did nothing to sell my home.” That’s what you are after: did the person work hard, or did they not? No agent sells every home that they list. Many sellers are unreasonable about pricing, and sometimes well-meaning agents are drawn into situations that just don’t work out. But avoid at all costs the dreaded “listing phantom” that locks you in on a listing contract for 60 or 90 days and disappears.

Would you please let me see your specific, detailed marketing plan that shows exactly what you intend to do to market my home?

To give you something with which to compare the agent’s plan, see Why Professional One, which represents the specific things that we do at Professional One. If they do as much or more than we do, then you very likely have found an agent worthy of consideration. If they do less, or if they have no specific, written plan, this is a good indication that you should move on to the next name on your list of Realtor candidates.

What recourse will I have if you do not do everything detailed in your marketing plan?

If you have no recourse, of what value is the plan? At Professional One, you can rescind your listing agreement with us at any time, for any reason.

How many hours per week do you typically work?

And then proceed to the next question…

How many listings do you have at the moment?

Most of the “marketing specialists” carry large inventories of listings. Many carry 30, 40 or even 50 listings at a time. Let’s assume that the Realtor indicated that they work 50 hours per week, and that they currently have 30 listings. Do the math: that means that they are spending, on average, 1.67 hours per week attempting to sell each of their listings! And that assumes that they are working with no buyers, which are major time commitments in and of themselves! Does that seem like an optimal arrangement for you, if you are to be listing number 31? Trust us when we tell you that you cannot properly service a listing in under two hours per week. A good Realtor will not take on more work than they can handle, because that is a recipe for dissatisfied clients. Sadly, many within the general population are impressed when an agent tells you about the massive volume of business that they do. What you should keep in mind is that many hours go into each and every successful real estate transaction. When you do too much business, by definition, the quality of the service provided suffers.

 Technical Questions to Ask

Following are technical questions you should ask when interviewing a prospective real estate agent.

What are the main expenses that a seller typically pays in a real estate transaction?

The costs that a seller is typically required to pay when selling a home in the state of Michigan are as follows:

  • Realtors’ commissions, as negotiated with the applicable Realtor(s)
  • State transfer tax, calculated as .0075 (or .75%) of the sales price
  • County revenue stamps, calculated as .0011 (or .11%) of the sales price
  • Title insurance, which varies depending upon sales price and is state-mandated / regulated
  • Occupancy escrow, if applicable, as negotiated per the transaction
  • Water escrow, if applicable, as negotiated per the transaction (typically $200 to $300)
  • Payoff of any existing mortgages or liens on the property.

What the various forms of agency that exist in the State of Michigan?

There are a number of agency relationships that can exist between realtor and client: transaction coordinator, dual agency, and the two most common, buyer’s agency and seller’s agency.

What is title insurance, who pays for title insurance, and how is the cost determined?

There are two generic contract types used by most agents in this market: a “buyer’s contract,” and a “seller’s contract.” The buyer’s contract includes additional language that deals with the following issues:

  • A higher level of title insurance
  • A provision for a review of easements and restrictions
  • A more liberal inspection provision that makes it very easy for a purchaser to get out of a transaction based upon inspection results
  • A risk of loss provision that includes more liberal language
  • An environmental issues provision

Be wary of an agent that does not have sufficient command of the basic contract. While Realtors are not attorneys, they certainly should be able to understand and explain any and every document that goes into the typical real estate transaction. Also, keep in mind that your agent needs to be well versed in reviewing contracts that may be presented by agents representing purchasers interested in buying your home. Certainly, you should always contact your attorney when unusual issues arise. But that does not absolve a Realtor from their basic responsibility of understanding, and being able to explain, any contract they are asking you to sign.

What are the two primary types of title policies?

The most common form of title policy is called a “title policy with standard exceptions.” A “higher” or “better” form of title policy is called a “title policy without standard exceptions.” While there are additional differences between these two forms of title policies, the most significant difference is that a title policy without standard exceptions typically requires that a staked survey be performed in order to issue such a policy.

What is radon, and why does it matter when buying or selling a home?

Radon is an invisible, odorless gas that is considered a carcinogen by the EPA. Virtually every home in Michigan has radon. The key is how much. You should always have any home that you are considering buying tested for radon. Even if you are not concerned about the health risks (radon is often compared to second-hand cigarette smoke), you should still perform the test as this could affect your ability to sell your home in the future (many people won’t buy a home that has a radon problem).

How common are radon failure rates in our market?

Quite common. Examples of failure rates as of the date of this web site update: Brighton, 59.3%; Northville, 39.4%; Novi, 25.1% and Plymouth, 15.2%. For a more detailed, comprehensive synopsis, go here.

What is the Michigan "Real Estate Transfer Tax," how is it calculated, and who pays it?

The State of Michigan enacted the “Real Estate Transfer Tax” a number of years ago when real estate property tax was reduced by approximately 40%. The tax is calculated as .75% (that is, .0075) of the sales price. The tax is paid by the seller at closing.

What is the difference between an offer that is "contingent upon the sale of a home" and an offer that is "contingent upon the closing of the sale of a home"?

A sale that is “contingent up the sale of a home” is a situation where a prospective purchaser is attempting to purchase a subsequent home, and that have no contract for the sale of their existing home. A sale that is “contingent upon the closing of the sale of a home” is similar, except that the prospective purchaser HAS a contract for the sale of their existing home, but the closing for that sale has not taken place.

What is "occupancy" as the term is commonly used in real estate?

“Occupancy” as it relates to real estate refers to the period of time AFTER the date of closing that the seller can contractually continue to live in the home.


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