Knowing which questions to ask a realtor during your first meeting to sell your house is crucial.
Because the right realtor can not only sell your home faster and make you more money, but they can also make the 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.
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 realtor 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 list price sets the initial tone.
Set the price too high and you’ll discourage motivated buyers from even visiting.
Price too low and you could be leaving money on the table.
The purpose of asking a realtor this question is to ensure they are not suggesting an inflated price to secure your business. Unfortunately, this tactic is not uncommon.
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 a commission
Want to avoid this happening to you?
Then ask them how they arrived at the price they’re suggesting.
You’re looking for an answer 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 they 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 analysis is what you’ll see on an appraisal report.
It’s comparing the features and characteristics of your home to the features and characteristics of each recently sold home nearby.
Seeing a breakdown of how they arrived at their recommended asking price will increase the chances that they’re not overpromising.
If the answer you get is vague and doesn’t include an in-depth explanation, then I would consider this a red flag.
Asking a real estate agent about how they arrived at their suggested list price (and getting the right answer) will give you a sense if you’re working with someone who has the experience, expertise, and integrity you’ll need.
Question#2: Will you also represent the buyer?
This is a great question to ask because the realtor’s answer will 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?
Your realtor will play a big role in how much money you make. Negotiating is a big part of this.
A top-selling 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 a real estate agent want to represent the buyer?
The total commission you pay when selling your home is usually split 50/50 between your agent and the buyer’s agent. If your agent also represents the buyer, this means they could make twice as much (you can negotiate this beforehand and see if the total commission will be less if this happens). This is where their integrity can be tested.
A realtor who is willing to risk their integrity for more money can mean a lower sale price. There are many realtors who won’t do this, but some will.
If they tell you they will not represent the buyer, then you have nothing to worry about.
If they say it’s a possibility, it’s not necessarily a bad thing. In fact, if you get an offer that meets or exceeds your expectations, then it could be a great thing.
Your realtor may already be working with a buyer who could be interested in your home. Or a buyer who is interested in your home might not be working with anyone and wants to submit an offer through your realtor.
The point of asking your realtor this question is to test their integrity.
So, if they tell you there’s a possibility that they can also represent the buyer, then ask them this follow up question:
How will you negotiate for me if you’re also representing the buyer?
You already know the answer but the realtor doesn’t know that you do.
The answer you want to hear from them is that they can’t.
Anything else is a red flag and I wouldn’t hire them.
Question #3: How will you market my home?
Marketing is key. It’s what can drive higher demand.
Higher demand means more buyers.
More buyers can mean a higher selling price in a shorter amount of time.
Buying a home is an emotional decision and top 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)
- Property description
- List price
- Advertising (flyers, brochures, ads, networking, etc)
Hearing about these is great. You want 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.
Top realtors 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:
- Lower price, which means lower monthly payments and lower property taxes
- 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 buyers?
When your realtor 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.
Top realtors 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 agent can put your home on the MLS. The best ones will have a plan and use the right marketing channels.
Questions to ask a realtor when selling
The first three questions are the most important because they’ll have the biggest impact on how fast you sell and for how much.
When you work with a realtor who tells you they can’t negotiate for you if they also represent the buyer, then you know there’s a great chance you’re working with someone who has integrity.
Working with a realtor who has a five-star marketing plan and the right data to back up your asking price will dramatically increase your chances of a successful sale.
Here are the other best questions to ask a realtor when selling.
Question #4: How will you vet the buyer?
Want to reduce your chances of having your offer fall through?
Then you need someone 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:
- The buyer wasn’t able to get financing
- The buyer backs out during their inspection contingency period
Here’s how a realtor 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 upfront 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.
A buyer can back out of the sale during the time they have for their inspection contingency.
Sometimes there is nothing you or your realtor can do to prevent this.
But if you want to reduce your chances of this happening, then I suggest two things:
- Have inspections completed
- 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 work with a realtor 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 we see 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.
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. Depending on your area and price point, the total commission is generally in the 5-6% range and is negotiable. The total commission is usually split between the seller and buyer’s agents.
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.
You can also ask the realtor to provide you with an estimated settlement statement. This is a one-page document provided by an escrow officer that shows an estimated sale price with the estimated costs.
You’ll get a final settlement statement when the sale closes, which is the document you’ll need when filing your taxes the following year. Check with your accountant, but usually, all of your closing costs are tax-deductible.
Do these three things to get a really good idea about how much you’ll net from the sale of your home:
- Ensure your suggested asking price is accurate
- Get a copy of the estimated settlement statement
- Check to see the remaining balance of your mortgage
Question #7: How many homes have you sold?
What’s the purpose of asking a realtor 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.
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…
- Proximity to freeways
- Recent sales
If a real estate agent has sold homes in your area, then they should already be familiar with potential selling points.
But if they haven’t, 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 browse online and find most, if not all of the information they’ll need in a matter of twenty minutes. Plus, you’ll be able to tell them what you think the selling points about your area are.
Question #9: 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 list price of those homes was.
This number is calculated by taking the selling price of all of the homes a realtor 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 agents.
Be leery of realtors who have a number that is much lower than others. This may mean they intentionally overpromise on their suggested list price.
In my opinion, anything under 95% can be a red flag.
Question #10: 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.
This is what we do with the realtors who we invite to become partner agents with SoldNest. They must be best-in-class with both of these numbers.
It’s a major red flag if the average days on market for a realtor are considerably higher compared to their peers.
Question #11: What percentage of your listings have fell 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 or helping prepare their clients’ homes as well as they should.
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 can mean you’re working with a top professional.
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 #12: Will I be working with anyone else?
Some top realtors have teams. This isn’t a bad thing as it can mean more resources.
But you want to know upfront who you’ll be working with and who will be the main point of contact.
The last thing you want is to not know who you’ll be communicating with.
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.
Questions to ask a realtor
- How did you arrive at your suggested list price?
- Will you also represent the buyer?
- How will you market my home?
- How will you vet the buyer?
- What do I need to do to get my home ready?
- What are the costs?
- How many homes have you sold?
- Have you sold homes in my area?
- What’s your sale to list price ratio?
- What’s your average days on market?
- What percentage of your listings have fell through?
- Will I be working with anyone else?
- How often will we communicate?
Ask these questions when interviewing realtors and maximize your chances of selling your home faster and for a higher price.
Remember, it’s not just about knowing which questions to ask. It’s about getting the right answers.