With tech startups disrupting in-person services across the board, it might come as a surprise that nine out of ten consumers still prefer to buy and sell homes through a human real estate agent. Silicon Valley may be funneling more cash into real estate technologies–venture capital invested in real estate tech companies reached $1.2 billion in 2017, up from $31 million only five years prior–but live agents nonetheless play a central role in the business models of many of the internet’s most popular real estate services, like Redfin and Zillow. Such sites offer perks including lower commissions (Redfin) or aggregated, categorically searchable listings (Zillow), but still rely on agents to intermediate between buyers and sellers.
For most people, real estate transactions are a massive, impactful undertaking, and live agents possess the flexibility and localized knowledge needed to walk consumers through the process. Besides providing a personal touch, the following are a few advantages unique to using a real estate agent.
As a representative of buyers and sellers, a real estate agent’s purpose is to make deals happen. Agents that represent buyers tap into professional networks to hunt down properties according to specific preferences, then contact sellers’ agents and set up showings. Coordinating these tasks takes extensive communication between multiple parties. This can be time-consuming for buyers going it alone. Solo sellers, as well, must solicit multiple offers, respond rapidly, and spend substantial time–and effort–arranging appointments.
Some avoid real estate agents in pursuit of complete transparency between buyers and sellers. However, a bit of well-placed opacity can be useful, especially during tense negotiations. For example, if a buyer dislikes house’s kitchen cabinetry and flooring–and complains directly to a seller–that could cause offense, as certain home modifications may hold sentimental value. Keep in mind that a single personality clash is all it takes for negotiations to fall apart. Agents, on the other hand, are trained to deal with temperments of all types. Having professionals act as middlemen can help diffuse any disagreements between buyers and sellers.
In real estate, purchase and sale agreements are meant to protect parties by holding all involved to specific, agreed-upon preconditions. If a buyer, for example, doesn’t add a financing contingency to their contract, and can’t get approved for a mortgage, they could forfeit their deposit and even suffer legal consequences for being unable to finish the transaction. Expert agents have the skills to create contracts that account for unique client needs while keeping them safe from penalties.
Anyone can deceive, but a licensed real estate agent, legally obligated to act as a fiduciary, is much less likely to behave in underhanded ways. Most states have regulations in place that require agents to act in their clients’ best interests, rather than their own. Besides the potential legal ramifications, lying to clients in an industry that depends heavily on referrals and lasting relationships is bad for business.
Selling property without a real estate agent means placing yourself at the mercy of an opposing party with no obligation to consider anyone’s interests but their own. Legal counsel is a possibility–and a good idea–for those without a real estate agent, but keeping a lawyer on retainer may end up costing much more than an agent’s commission.