Property News You Can Use presented by Harcourts

Everyone in your circle of friends or family knows a real estate agent. But unfortunately, television has somehow created a stereotypical representation of real estate agents. Unfortunately, in doing so, the general public has adopted some assumptions about agents that are very far from the truth. 

1. They make “easy money.” 

Oh ya, haha. The only people who could ever possibly make the case that being an agent is an easy way to make money are those who have never done it. It’s hard, uncertain work, with many instances of months wasted on a deal that doesn’t ever close. Furthermore, the estate agent never has immediate gratification. They always work on a post-dated cheque of at least 3 months. 

2. They are required to show you houses even if you just ‘want to look or are not a serious buyer or not pre-approved. 

There are definitely agents who will show you houses in such instances. Still, a professional agent is not required, and most experienced agents probably will not. The agent has a signed mandate from the seller where the agent undertakes that all viewings to introduce the property will be to serious, qualified buyers. This thereby protects the interest and privacy of the seller at all times. 

3. As the owner, I can do self-pricing. I know the worth of my property 

It would be wonderful if this were accurate for sellers to determine their own home valuations. Still, you’d laugh in most cases if you compared their results to actual appraised values. Trust us, real estate agents want you to get as much money as possible for your house, but often reality gets in the way. Trust your estate agent to give you a fair market assessment for your home. It is, in the end, what the market is prepared to pay. Buyers are astute and do their homework. They will not even view an overpriced property. 

4. They make massive commissions 

The popular real estate flipping shows on TV and Million Dollar Listing have given everyone the impression that real estate agents are rolling in the dough. Of course, most real estate agents wish this was true, but the reality is much different. The median commission on the existing home sale price from December 2021 to July 2022 was R100,000. This means that, after splitting the commission and paying their broker, an agent took home about R35,000 (gross) on the transaction. This does not include all the agents’ marketing and related expenses. In general, most agents sell only every second month, which adds to about R420,000 annually. Not exactly huge. 

5. They’re an unnecessary evil 

Many people have argued that real estate agents are unnecessary and merely an impediment to a more efficient “For sale by owner” model of real estate. The best way to eliminate this misconception is to sell your house yourself. Nothing is more sobering than desperately having to “google” all the laws & understanding all the relevant clauses about selling property. Furthermore, in terms of your own protection and security, it is pretty dangerous opening your home to strangers knocking on your door asking to view your home. 

6. They’re sleazy 

Unfortunately, real estate agents have joined the ranks of lawyers, politicians, and salespeople in some of the public’s assumptions about their trustworthiness. The financial collapse of 2008 exacerbated this perception. Thankfully, the market correction also weeded out most of the unsavoury elements in the business. The truth is, real estate agents are honest, hardworking people who make a living like any other profession. And just like any other profession, there are a few bad apples that unfairly give others a bad name. 

7. They’re uneducated 

This misconception gets under most agents’ skin. Not only do many agents have degrees (and advanced degrees in quite a few cases), but the knowledge required to pass a real estate exam is substantial. Many agents/agencies are unable to get their FFCs because of their inability to pass the necessary exams and compliance requirements, which makes the concept of an “uneducated” agent laughable. 

8. They want you to pay more for a house so they can make more money 

If you looked at the math involved in calculating real estate commissions, you’d never utter this falsehood again. An agent getting you to pay R10,000 more for a property will often earn less on the deal. This is because the commission will either stay unaffected to ensure the seller achieves a specific net price, or if the commission is linked, the nett result is minimal. This barely covers the cost of petrol required to drive to and from your appointments. The truth is that an agent absolutely wants you to buy a house. What’s not true is that they want you to pay more. 

9. They’re mostly part-timers or bored housewives 

If you ask the average person to describe the archetypal real estate agent, they’ll probably say it’s an older married woman looking for something to do in her free time. This is stereotyping at its finest and ignores the hundreds of thousands of full-time professional agents and the hardworking primary breadwinners that make up the real estate workforce. Moreover, the so-called stereotypical agents can hardly exist in our current market conditions. What an estate agent must do to fill their role and comply with the legal, compliance and qualification requirements to qualify for Fidelity Fund Certificate. 

10. All they want from you is the deal 

Yes, agents want your business. But genuine professional real estate agents want to be your lifelong real estate advisor. They want you to think of them whenever you or your family and friends have any real estate questions. They want to see and talk to you more than once a decade. They want to ensure that you remember your interactions with them as delightful.