Story by Ann Butenas
Spring has sprung, and for many homeowners the season ushers in the possibility of buying and/or selling a home. In this day and age in which technology advances exponentially, providing a cornucopia of options in the real estate market, how do you know where to begin? Do you choose to roll up your sleeves and go it alone while you peruse the many online MLS sites or do you seek out a qualified real estate agent to walk you through the process? Should you choose a commissioned-based real estate agent or is it more beneficial to work with a flat-fee agency?
Real estate expert Kevin Hopkins, owner of 395 Realty in Overland Park, Kansas, offers a few simple suggestions and ideas to turn that FOR SALE sign into a SOLD one while simultaneously offering great opportunities to find that dream home. Hopkins, along with business partner Greg Shahan, has been successfully assisting homeowners navigate this seemingly overwhelming process and sheds some light on how to make each transaction a win-win.
KCH&S: When looking for a real estate agent to sell your home, what are some key questions to ask before deciding to work with one?
HOPKINS: It is important to find out what that agent will do specifically to market your property and what he/she does that is different from anyone else. You also want to find out what that agent’s advertising budget is; how much experience he/she has in the business; how many transactions he/she has per year; and if the agent works full or part-time. When you are hiring an agent, you are hiring an advocate to work for you with fiduciary duties to represent and protect your best interests. It is important to work with an agent who understands this.
KCH&S: Contracts always seem overwhelming and confusing. What are some contract terms of which a seller should be aware? In other words, of what fees should one be aware?
HOPKINS: It’s important to remember that commissions and fees are negotiable. Many agents may not reveal this upfront, and the seller should always ask what specific marketing the agent is going to do on the property.
KCH&S: What is the difference between a full-service agent and a flat fee agent?
HOPKINS: There really is no difference, other than the fee or commission the consumer pays. What has changed in the industry is the introduction of the internet. Before the internet, advertising was an agent’s #1 expense, even above office expenses. Today, because of all the free online listings through various MLS sites, the reality is that only a few agents spend money on advertising specific properties. What a flat-fee agent provides is no different than one who operates from a traditional commission structure, though with a flat-fee agent the cost to the homeowner may be less than the commission fee depending on the selling price of the home. Both types of agents should do a market analysis of the home; discuss the market; and consult with the seller as to what they want to do with the home before putting it on the market.
KCH&S: What should a seller do before putting a home on the market?
HOPKINS: The answer lies in the pricing. We know there is no perfect house out there. For every buyer, there will be some issues with the home and it most likely won’t fit all of his/her priorities, and thus the buyer will have to concede some of those priorities. When putting your home on the market, start with thinking of it as turn-key, move-in condition. Is the home in tip-top shape? In other words, are the roof, structure and foundation sound? Do the appliances work? Then, we can easily identify the value of the property. Some sellers may have to ask themselves if they want to invest, say $30,000, into some improvements or would it be easier to reduce the price and sell as is?
KCH&S: Can any given agent make a house worth more than market value?
HOPKINS: Probably not, but they all propose the fact that they or their firm can affect that. A house, like a car, is worth only what the market will bear. It is based on supply and demand, which is what drives value. Period.
KCH&S: What changes do you anticipate in the 2017 housing market?
HOPKINS: I expect this year to be a year like 2016, with inventory lower than normal and more buyers in the marketplace. This will continue to push up prices and we will probably see interest rates go up progressively, which will inherently tighten the market. Homes seem to be moving very well in the current market and this year I expect it will be easier to sell but harder to buy.