What role can a buyers agent take when a seller is asking for an inflated price for a property?

Knowing which questions to ask a realtor during your first meeting to sell your house is crucial.

Why?

Because the right realtor can not only sell your home faster and make you more money, but they can also make the selling process much less stressful.

Choose the wrong person and it can be the complete opposite.

But how do you know if you’re hiring the right realtor?

You need to ask the right questions.

And here’s the key…

It’s not just about knowing which questions to ask your realtor.

It’s about getting the right answers.

There’s one question that is so important that, in my opinion, if you don’t get the right answer, don’t hire them.

Let’s get started.

Questions to ask a realtor when selling

Many homeowners don’t know what to ask a realtor when selling.

So they’ll ask a few generic questions and make sure they have a “good feeling” about them.

While having a good feeling about the real estate agent you’re selling with is important, the questions you ask and the answers you get are much more important.

Your real estate agent can literally make or break your sale.

Don’t risk hiring the wrong person because you didn’t ask the right questions.

And don’t skip the interview process just because you know them or think you can trust them.

Here are the best questions to ask a realtor when selling.

Question #1: How did you arrive at your suggested list price?

Notice that this question isn’t, “What do you think my asking price should be?”

Every real estate agent will tell you what they think you should list your home for.

But the “how” is much more important.

Setting the right asking price is key to maximizing your offer price and selling quickly.

Your home is worth what someone is willing to pay for it, but the listing price sets the initial tone.

Set the price too high and you’ll discourage motivated homebuyers from even visiting.

Price too low and you could be leaving money on the table.

You want to ask a real estate agent this question before hiring them to ensure two things:

• They have the knowledge to justify this price when negotiating.
• They’re not suggesting an inflated price to secure your business.

The answer you get needs to be backed by data.

Let me explain.

During your initial meeting, the realtor should be presenting you with a comparative market analysis (also known as a CMA).

This is an analysis your potential listing agent will put together that compares your property to the best recently sold homes (also known as “comps”).

Realtors who cannot justify their suggested price will usually keep their analysis very vague.

They might show you a few recently sold homes, but they won’t back up their reasoning with how they arrived at the price.

What you want to see is a breakdown of how your house compares to each recently sold home.

Here’s an example of what this comparison might look like:

This type of real estate analysis is what you’ll see on an appraisal report.

It includes value adjustments for the key differences that can impact your potential selling price.

The ones that have the biggest impact are:

• Square footage
• Condition
• Bedrooms
• Lot size
• Schools
• Proximity to road noise
• Bathrooms

You want the answer from the listing agent you’re interviewing to include the same data.

It will immediately give you a glimpse into how savvy the real estate agent is before hiring them.

This is important because if their answer is vague and doesn’t include data like this, they’re likely inexperienced or they’re intentionally inflating their price to secure your business.

I would consider this a red flag.

If their answer and analysis do include real estate data that justifies their price, then you know they’ll make the same argument when negotiating for you.

But be careful…

If the real estate agent to whom you’re asking this question sells a lot of homes, they have the experience to use data like this to convince you that they can somehow magically sell your home for a price that is too good to be true.

This is an extremely common tactic that can cause your house to sit on the market and end up selling for a much lower price than it should.

One of the upcoming questions will help you almost completely eliminate this from happening to you.

Question#2: Will you also represent the buyer?

This is a great question to ask a real estate agent when selling because their answer can tell you about their integrity.

Can a realtor who is selling a home also represent the buyer?

In most states, yes.

Should they also represent the buyer?

No.

Your realtor will play a big role in how much money you make. Negotiating is a big part of this.

The right realtor can literally net you thousands more just by knowing which questions to ask the buyer’s agent and when.

When they also represent the buyer, they cannot negotiate for you.

You can see this in the agreement you’ll sign with them.

Here’s where it says this in the listing agreement used in California.

Why would your real estate agent want to represent the buyer?

To double their commission.

The total commission you pay when selling your home is usually split 50/50 between your listing agent and the buyer’s agent.

If your real estate agent also represents the buyer, this means they make twice as much.

Unfortunately, many real estate agents are willing to risk their integrity to make this happen.

In many cases, the end result means a lower selling price by tens of thousands of dollars.

The point of asking your realtor this question is not just to save you from potentially selling below market value, but also to test their integrity.

The immediate answer you want to hear is that they will not represent the buyer.

Anything other than this is a red flag.

If they do give you the answer you’re looking for, then follow up with this question:

“In what percentage of your listings have you also represented the buyer?”

This is a great follow-up question to ask your real estate agent before you commit to hiring them.

Why?

Because even if they tell you that they won’t represent the buyer, their answer to this question can paint a better picture about their integrity.

I would be leery if their answer is anything above ~10%.

Many of the “top” selling agents who make it a priority to also represent a buyer client in the same transaction have a percentage of ~12% or higher.

Question #3: How will you market my home?

Marketing is key. It’s what can drive higher demand.

Higher demand means more homebuyers.

More buyers can mean a higher selling price in a shorter amount of time.

Buying a home is an emotional decision and the best agents incorporate emotion into their marketing plan.

When you ask a real estate agent how they’re going to market your home, most will discuss these items:

• Multiple listing service (also known as “MLS“)
• Syndication to real estate portals (Zillow, Redfin, Trulia, etc)
• Staging
• Property description
• List price
• Photos/Video
• Advertising (flyers, brochures, ads, networking, etc)

Hearing about these is great. You need to know how they’re going to get the word out.

But you want to dive a bit deeper and hear about their specific approach.

What are the selling features of my home?

Every home has selling features.

It doesn’t matter if the home is in great condition or a fixer-upper.

Or if the schools have high scores on greatschools.org or below-average scores.

A realtor who knows how to get top dollar will find positive selling points and will use them when marketing.

For example, the two selling features for a home in need of work could be the following:

1. Lower price, which means lower monthly payments and lower property taxes
2. The opportunity for the buyer to add their “own artistic touch”

A good agent will do their homework before meeting with you and should be able to tell you the features they would use as selling points.

Who do you think the buyer for my home will be?

This is a great marketing question to ask a real estate agent.

The type of buyer for any given home can be different depending on the area, property type, price range, selling features, etc.

For example, a buyer for a condo in San Francisco is probably going to be different than a buyer for a single-family residence in a suburban neighborhood.

A buyer for a home listed in a retirement community is going to be different than a home for sale in Downtown Austin.

The answer you’re looking for is something specific.

Of course, your buyer can be anyone, but every home will appeal to a larger demographic more than others.

A generic answer most likely means the agent doesn’t know who they’re selling to.

This doesn’t mean you won’t get a great offer, but it does mean their marketing plan won’t maximize the opportunity.

How do you plan on marketing to those homebuyers?

When your real estate agent knows what the selling features are and who the buyer for your home might be, it’s almost certain they’re going to have a plan on how to market to those buyers.

The best selling agents excel at this.

The approach used to target a younger audience will be different than an approach used to target an older audience.

An approach used to market a home that needs work will be different than an approach used to market a home in great condition.

Any real estate agent can put your home on the MLS. The best ones will have a plan and use the right marketing strategy.

Question #4: How will you vet the buyer?

Want to reduce your chances of having your offer fall through?

Then you need a good agent who knows how to vet the buyer.

This is the number one reason why you’ll see a home go back on the market after it was pending.

There are usually two reasons why this happens:

1. The buyer wasn’t able to get financing
2. The buyer backs out during their inspection contingency period

Here’s how a good agent can vet a buyer for financing:

• Make it a requirement for the buyer to submit their pre-approval letter with the offer
• Call the loan officer after receiving the offer

A key question a realtor can ask the loan officer is this:

“What’s the buyer’s debt-to-income ratio?”

All lenders have a maximum ratio. If a buyer is not able to obtain financing, this is usually the reason.

Knowing the buyer’s ratio up front lets you know that the buyer meets this qualification.

It can also help in negotiating.

If your realtor knows the buyer’s debt-to-income ratio up front, then the buyer’s agent cannot use this as an excuse as to why the buyer can’t come up in price.

You want the answer from the real estate agent you’re interviewing to include how they’re going to make sure the buyer is qualified.

But you also want to hear about their approach to minimizing the chances of a buyer backing out during their contingency period.

Sometimes there is nothing you or your realtor can do to prevent this.

But there are two things that can help:

1. Have inspections completed before selling
2. Make sure the buyer is aware of what’s in the inspection reports

After receiving the offer (or sometimes before), your realtor should simply ask the buyer’s agent if they have thoroughly gone through all of the inspections.

By doing this, it will be very difficult for the buyer to back out of the sale due to something they were already aware of.

When you sell with a real estate agent who knows how to vet the buyer, your chances of a successful sale will dramatically increase.

Question #5: What do I need to do to get my home ready?

The appearance of your home will have an effect on how fast you sell and for how much.

A common mistake that many sellers make is spending too much time and money on things that don’t matter.

The goal is to spend the least amount and only on things that will bring a return on your investment.

And that’s exactly what the answer should be about when you ask your real estate agent this question.

This will tell you how experienced and savvy the realtor is.

The best ones know exactly what should be done to make your home more appealing to buyers.

And if you plan on living in the home while it’s for sale, ask the realtor what items inside your home can stay and which ones should go.

The best real estate agents can walk around your home and immediately provide you with a list of what you need to do to get your home ready to sell.

Question #6: What are the costs?

You probably want to know how much you’re going to walk away with.

The equation to figure this out is simple:

(Selling price – anything owed on the property – closing costs = your net proceeds)

A chunk of the closing costs is going to be the commission.

There are other closing costs too, such as escrow fees, title fees, and attorney fees (if you live in a state that requires this), but the commissions will be the largest part of your total cost.

Here’s an example of the closing costs a seller pays in California.

Depending on your area and price point, the total commission is generally in the 5-6% range and is usually split between the seller and buyer’s agents.

Check with your accountant, but usually, all of your closing costs are tax-deductible.

Asking the realtor about the costs during your first meeting will allow you to compare their services and fees to those of other realtors you might interview.

And commissions are negotiable.

But you need to be careful.

Some listing agents who charge a lower fee are the ones who won’t go up to bat for you.

So ask the realtor this follow-up question.

Will you lower your commission?

This question is putting your potential realtor to the test.

How?

Negotiating.

You want to see how the agent responds.

The ideal response is an immediate reply explaining why that realtor is worth the commission.

You want to hear them “put up a fight.”

The response you don’t want to hear is an immediate “yes”, or a very weak reply.

I’d consider this a red flag.

Why?

Because if that realtor can’t defend their financial interest, they won’t know how to defend yours.

Question #7: How many homes have you sold?

What’s the purpose of asking a real estate agent this question?

To make sure you’re working with someone who has experience.

Working with someone who has minimal experience is going to drastically reduce your chances of making the most money.

There are many moving parts in a real estate transaction and you want to work with someone who has the experience you’re going to need to maximize your chances of a successful sale.

Ask to see their portfolio of homes sold and when. The more recent, the better.

Some realtors have been in the business for twenty years with a lot of sales under their belt, but the number of homes they’ve sold over the last several years is minimal.

You should aim to work with someone who doesn’t just have the experience, but someone who also has numerous sales over the last several years.

Question #8: Have you sold homes in my area?

This isn’t as important of a question to ask your realtor as it used to be, but there’s a reason why I included it.

Twenty years ago this question was much more important than it is today.

Why?

The Internet.

Today, many buyers search online and are able to find out everything they need to about a neighborhood.

When I say everything, I mean everything…

• Schools
• Shopping
• Proximity to freeways
• Crime
• Recent sales

But there are some things about a neighborhood that buyers won’t be able to find online.

This is why you want a real estate agent who has some experience selling properties somewhat close to yours.

They’ll know the selling points of your area, which can help potential buyers justify a higher offer price.

But if they don’t have experience selling in your area, you shouldn’t cross them off your list.

Most sellers ask this question when interviewing real estate agents because they think it’s a necessity. It’s not.

If the realtor answers this question with “no”, then you want to hear an answer that includes how they plan on getting the information about your neighborhood that they’ll need.

A savvy realtor can do their homework and get all the information they’ll need.

Plus, you’ll be able to tell them what you think the selling points about your area are.

Question #9: Can I cancel our agreement?

This is the most important question to ask a realtor.

The answer you get will 100% tell you about the realtor’s integrity.

Let me tell you why…

When you decide which real estate agent you’re going to sell with, you’ll sign an agreement with them.

This is exclusive to you and your agent.

The length of this agreement is usually 6+ months.

This means that you cannot fire your agent and hire another one during this time.

This also means that as long as your house sells, your realtor gets paid, whether you’re pleased with their services or not.

Because of this, many realtors will overpromise during your first meeting with them.

They’ll do and say whatever they have to so that you’re locked into an agreement with them.

The most common one?

Telling you they can sell your house for an unrealistic price.

This is especially common among “top” real estate agents.

Many of them base their entire business model on this and have been doing so for years.

They market themselves as a “top selling agent” or “neighborhood expert” and suggest an inflated price to get the seller to sign the agreement.

Here’s the thought process for the realtors who do this. Their plan is to:

• Get you excited about a higher price
• Sign the listing agreement with you
• Let the home sit on the market (they know this will happen)
• Tell you to reduce the price
• Sell the home at a lower price, but they still get an agent commission

When this happens, the listing becomes “stale” and buyers start to wonder what’s wrong with the property.

The final selling price is usually much lower than it should have been if the home had been priced right from the start.

Want to reduce the chances of this happening to you?

Then the realtor’s answer to this question should be “yes.”

Without any hesitation.

There is absolutely zero reason why you should be locked into a contract.

And you need to get in writing.

You might hear something that sounds convincing about how they can’t do that.

It’s simply not true.

The listing agreement does not include this language but the realtor can easily add it.

Even though you may not cancel the agreement, having the option to do so will no longer “guarantee” their commission check.

Which means their trustworthiness will skyrocket.

This also means that you’ll be selling with someone who will be doing everything they can to sell your house fast and for top dollar.

Do not skip this question.

It’s extremely important to the sale of your home.

How important?

If they don’t give you an immediate “yes,” then you shouldn’t hire them.

Question #10: What’s your sale to list price ratio?

Any realtor can show you how much they’ve sold homes for.

But you want to see what the original listing price of those homes was.

This number is calculated by taking the selling price of all of the homes a real estate agent has sold and then dividing them by the listing prices of those homes.

For example, if a realtor has an average selling price of $1,000,000 and an average asking price of $950,000, then their sale to list price ratio would be 105%.

You can take this number and compare it to other realtors you might interview.

Be leery of listing agents with a number that is much higher or lower than others.

A ratio that is on the higher end means that the realtor underprices the homes they sell.

They do this so that they can market the home they just sold to other homeowners with something like, “Just sold for $$$ over the asking price!”

Usually, the listing agents who do this have a sale-to-list price ratio of ~110% or higher.

Ones with a ratio on the lower end overprice the homes they sell.

Either because of a lack of experience or because they intentionally overpromise on their suggested listing price.

In my opinion, anything under 95% can be a red flag.

Question #11: What’s your average days on market?

The average days on market is the number of days from when your home is first listed on the MLS to when you accept an offer (not when the sale is closed).

This can give you a rough idea of how long your home might take to sell (although there are many other factors that can impact this).

Similar to the sale to list price ratio, this is another number you can compare to other realtors.

A higher-than-average number of days to sell means that the realtor overprices their listings.

And a lower-than-average number almost always means they underprice the homes they sell.

Question #12: What percentage of your listings have fallen through?

I particularly like this question because a number that is higher than usual can mean the agent doesn’t do a great job vetting the buyer.

A transaction can fall apart for many reasons, but an agent who has a track record of not having to put their listings back on the market knows how to make sure the sale closes.

For me, anything over 5% is concerning.

Of course, the total number of listings the agent has needs to be factored in.

The more homes they’ve sold, the better this number will represent how well they do their job.

Question #13: How often will we communicate?

You’re about to embark on a journey.

You don’t just want to know who will be your main point of contact, you want to know how often you’ll be communicating.

Not all transactions are smooth sailing. Sometimes there are bumps in the road.

You want a real estate agent who has no problem discussing the good, the bad, and the ugly.

It’s important they commit to how often they’ll be in touch, no matter how good or bad it’s going.

Conclusion

Let’s recap…

Questions to ask a realtor

1. How did you arrive at your suggested list price?
2. Will you also represent the buyer?
3. How will you market my home?
4. How will you vet the buyer?
5. What do I need to do to get my home ready?
6. What are the costs?
7. How many homes have you sold?
8. Have you sold homes in my area?
9. Can I cancel our agreement?
10. What’s your sale to list price ratio?
11. What’s your average days on market?
12. What percentage of your listings have fallen through?
13. How often will we communicate?

Your first meeting with a realtor to sell your house is crucial.

It’s your opportunity to make sure you’re hiring someone who will treat your sale as if it’s their own.

This is the person you’re going to need.

There are many steps when selling a house, and your realtor can literally be the difference between selling fast and for top dollar and having your house languish on the market and selling below market value.

Ask these questions when interviewing real estate agents and you’ll put yourself in the absolute best position to ensure you’re choosing the right realtor to sell your home.

Remember, it’s not just about knowing which questions to ask.

It’s about getting the right answers.

Which of the following must be included in a buyer agency agreement?

What is a major benefit to a buyer who agrees to representation?

What are the features of an open buyer agency agreement?

Which of the following is not a section in the buyer representation agreement?