How to choose a real estate agent

So, you have decided to sell your home. While there is no legal requirement that a real estate agent be involved in an agreement of purchase and sale – or in a real estate transaction, for that matter – most agreements and transactions involving the purchase and sale of real property do involve real estate agents.

How do you pick a realtor? Let’s see… Uncle Bob’s cousin’s sister’s aunt’s brother-in-law Bill, says that Sadie is a great agent and you should use her. That’s good enough for Bill and should be enough for you. Wrong. When you want to pick your realtor, be careful, be challenging, be prudent, be investigative and be picky. Your realtor is one of the most important and expensive steps in selling your home. A good realtor can sell your home quickly and at the right price. A bad realtor can leave you sitting with your house going stale on the market, and frankly could even cause you damage if you bought somewhere else.

References and follow-up

Firstly, interview a number of agents. Let them sell you first. If they can’t sell you, how can they sell your home to someone else? Ask for references and follow up with them. Call people who they claim they did a great job for and speak to them. Check with your lawyer (you have a lawyer of course… get the lawyer first) and ask the agents to tell you how many houses they have listed and how many sold in the last six months. Ask for a written proposal as to how they will proceed, where and how often they will advertise, conduct open houses, handle signage – all of those kinds of things. You want a plan, not a promise.

When you decide on a real estate agent, you will be asked to sign a listing agreement. This contract sets out the terms on which you are willing to sell your property. Contrary to popular belief, the listing agreement is not a legal requirement that you accept any offer, even if it is on the same terms you said you wanted in the listing agreement.

Enforce performance

The listing agreement contains how much you will pay your realtor and/or the selling agent as well as the terms. It is valid and binding. This is really important – be careful and negotiate the commission rate and the term. Use these items to enforce performance by the realtor.

Be aware of the fact that the term is deemed to be extended for 90 days in the case of a purchaser who was introduced to the property – or to the vendor – during the original term by the agent. Therefore, the realtor would be entitled to the commission stated in the listing agreement in the event of a sale to such a party during this 90-day extended period. This is to stop you from working around the agent, and it is effective. In Royal LePage Real Estate Services Ltd. V. McArter (2000), 94 A.C.W.S. (3d) 612 (Ont. S.C.J.), the client tried to work around the agent, but the Court supported the agent and the client had to pay.