Property purchase is a big project and the real estate agent is a critical part of that process, unless you are buying directly from the builder in the original allotment. Real estate business in India is a space where misinformation and mis-selling is rampant, and therefore it is important that you select a good real estate agent to help you buy a property. There is a myth in real estate that, real estate agents are always the seller’s agents. It is not true. Good agents can help buyers get an excellent property deal. In this blog, we will discuss a few tips in selecting the right real estate agent for you.
Do your own research:Many real estate agents are good at making impressive sales pitches. But property buyers should remember that misinformation is very common in the real estate market. You may hear from your agent how property prices are escalating so rapidly in the neighbourhood you are interested in and unless you buy immediately, you may have to pay a much higher price. You may be told of upcoming residential and commercial projects near the property your agent wants to sell. Do not take what you hear from your agent, at face value. You should do your own research. If you know any home owner in the neighbourhood, where you want to buy a property, you should enquire about prevailing rates and escalations over the last few years. You should also look at listings on popular property listing websites like magicbricks.com, 99acres.com, allcheckdeals.com etc. A word of caution when you look at property listing on these websites. Not all listings are genuine. Some listings are out there just to grab your attention. Look at listings posted by the actual seller, and you can get a sense of the prevailing property prices. Do not depend on a single agent. You will get multiple perspectives when you speak with a number of agents. Doing your own research will arm you with the knowledge to protect yourself against mis-selling and misinformation.
Check the license of your agent:Some states require real estate to have a license authorized by the relevant body in the state. You should check the license of your agent. You can also check with the appropriate authority if there have been complaints or disciplinary actions against the agent. This is an important step that many property buyers ignore. Checking your real estate agents license and keeping a copy for your future reference, will give you recourse to complaint redressals, if you run into problems with your property purchase.
Check the credentials of your agent:Reputation is a critical success factor for real estate advisory. You should ask your real estate agent to provide references of clients. You should try to speak with two or more clients and ask relevant questions about the integrity of the agent, the knowledge of the agent, the quality of his or her service and if possible, prices of properties they purchased through your agent. If your agent has a website, you should go through the same. A website often gives you a lot of information about the credibility of the agent. However, as discussed earlier, substance is more important than form or presentation. Therefore, you should pay attention to substance when going through your agent’s website.
Find out who your agent is working for:Unlike stocks trading in share market, price discovery in the real estate market is not a transparent mechanism. A property purchase is a transaction between two parties, the buyer and the seller. The real estate agent facilitates the transaction between the two parties. The seller wants to sell at the highest price and the buyer wants to buy at the lowest price. But what is the motivating factor for the agent? If your agent is also working for the seller, then his incentive may be in convincing you that the price of the house is higher, so that he can get a higher commission. Therefore, it is important to find out who your agent is working for. You may ask the agent. But if you think that, you will not get an honest answer, you should also ask the seller, who his or her agent is. Sometimes as property buyers we may think that the real estate agent is always motivated to sell you the property at a higher price. But this is not always true. After all, as a buyer, you can always walk away from a transaction if the price is too high. Therefore, it is in the best interest of your agent to get the deal done to your satisfaction.
- Be wary of the agent who avoids arranging a face to face meeting with the seller: It is very important that you meet with the seller face to face, before finalizing the deal. If you do not meet the seller, you may be at the risk of being misled. You should insist on your agent arranging a face to face meeting with the seller. If the meeting gets delayed due to genuine calendar conflicts it is understandable. However, if your agent delays in setting up a meeting or if the scheduled meeting gets delayed a number of times without sufficient explanations, something may be amiss. Even if you and the seller live in different cities, you should meet with the seller and not be rushed by your agent, to close the deal remotely.
- Be wary of the agent who avoids providing information on details of the property: As with a lot of other transactions, the devil lies in the details of a real estate transaction. You should ask as many questions as you can, regarding the details of the property. If the agent does not provide you sufficient details about the ownership of the property, copy of the property deed, mortgage documents and other necessary documents when requested, you should be careful and not rush into finalizing the deal. Sometimes agents avoid answering questions, regarding the quality of construction, history of possession delays by the builder etc. You should not rush into a deal even if the price seems attractive to you, unless you have all the necessary information.
Find our agent’s fees:It is very important, that you discuss and negotiate your agent’s fee upfront, so as to avoid disputes later. Often real estate agents skip the fees part, and even if you want to discuss they say that fees can be decided after the completion of the deal. But sometimes agents charge a very high percentage after the deal is completed and this often leads to disputes with the agents. You should be very clear upfront about the fees of your agent.
Property purchase is a big financial commitment as well as an emotional investment. Many home owners will also agree that, buying a property is also a stressful experience. A good real estate agent can make the experience less stressful, while ensuring that the buyer gets value for his or her money.