1) The More You Pay for a House, The More an Agent Makes
False. Ever hear a friend say this: "Every dime more you pay for that house makes the agent more money, so don't trust that agent." That's a misunderstanding. The difference between $300,000 and $310,000 is about $150 to an agent.
2) The Less Commission You Pay to Sell, The More you Make
False. Discount brokers like to propel this myth. They claim to save sellers money by charging less. The truth is agents who are top producers and excel in this business do not discount services.
Why? Because they don't have to.
Less-than-full-service agents can't afford all the bells & whistles paid for by full-service agents, who tend to draw higher offers. It boils down to you get what you pay for. A 2% commission reduction doesn't amount to much when your price is discounted 10% or more because your agent couldn't afford full market exposure.
3) LIST HIGH
Set your home price higher than what you expect to get. Listing your home at too high a price may actually net you a lower price. That's because shoppers and their real estate agents often don't even look at homes that are priced above market value. It's true you can always lower the price if the house doesn't garner any offers in the first few weeks. But that comes with its own set of problems. "Buyers are highly suspicious of houses that have sat on the market for more than three weeks," says Nela Richardson, chief economist for the brokerage Redfin. In areas such as San Francisco where multiple offers are common, sellers will actually price their homes for less than they expect to get, in the hopes of getting multiple offers above asking price. However, if you do this in a declining market, the danger is that all the offers will come in at the asking price or lower.
4) FSBO nets more money
False. While you can save money selling your home yourself, very few people do successfully sell homes on their own. They need the time, skills to get the home listed online, market the home to prospective buyers, negotiate the contract and then deal with any issues that arise during the inspection or loan application phases. It's not impossible to sell a home on your own, but you'll find that buyers expect a substantial discount when you do, so what you save on a real estate commission may end up meaning a lower price. It's not impossible to sell your home on your own for the same price you'd get with an agent, but it's not easy.
5) Agents Get Kickbacks from Lenders / Title / Inspectors
False. Since 1974, agents have been prevented from receiving any kind of kickback or favor from real estate vendors. It's against the law. It's against RESPA: the Real Estate Settlement Procedures Act. Some agents are slower than others to realize how the law affects them, but most are reminded of this repeatedly.
6) Agents Should Tell You About Crime, Schools & Ethnic Make-up of Neighborhoods
False. Federal Fair Housing laws prevent a real estate agent from discriminating against a number of protected classes, which automatically prohibits an agent from disclosing anything remotely relating to the protected classes.
Therefore, it may come as a shock to many people that agents cannot disclose crime rates, school stats or ethnic mixes of neighborhoods. If that kind of information is important to you, an agent can tell you where to find it but cannot provide it.
Those who tell you otherwise are misinformed.
7) “You don’t need an inspection for a new build or recent renovation.”
False. Some buyers are under the impression that they can forgo the inspection for a property that is new or recently renovated. How much could be wrong if everything is new, right? From an improperly installed dryer vent to faulty wiring, new developments can have minor and major problems that aren’t apparent until you get a professional in to do a thorough review.
While there may be competitive reasons to waive the inspection contingency in the contract, the decision to do so should not be taken lightly and should be made with full knowledge of the risks. Regardless of how shiny and new the property looks, it is in the buyer’s best interest to spend the money to get a thorough inspection from top to bottom.
8) “Your home is updated and in a good neighborhood, so you don’t need to stage it to sell.” False. Even the most beautiful, high-end homes should be staged and photographed by a professional photographer. Listing photos are a critical factor in the selling price of your home, how quickly it sells, and whether it sells at all. Our agents found that homes with professional listings photos sold faster, for more money, as much as several thousand dollars more.
A professional stager can provide objective advice on how to get your home photo-ready. They see a lot of homes so they can speak to design trends and features that are common in homes for sale in your area. You live in your home every single day and stop noticing little things that make a big difference in listing photos — a frayed rug, clutter in the entry way, chipped paint, etc. Spending a few hours to de-clutter and a few hundred dollars for a fresh coat of paint will go a long way in attracting the most interest from potential buyers.
9.) If buyers don’t like an exterior, they’ll never go inside.
Without some curb appeal, most think, “Why waste the time,” says Grant. She suggests buyer’s agents prepare clients for the exterior ahead of time by asking buyers in advance what styles of houses they like and dislike, and even showing them images before checking out a place in person. If a house works otherwise—its layout, number of bedrooms and bathrooms, and maybe a backyard—she says listing agents can find ways to remove or downplay features that may not appeal. Exterior changes may be as simple as adding landscaping that dresses up part of the offending façade, painting shutters and a door to focus attention, or upgrading a walkway with a nicer material.
10) The agent who shows you homes or lists your home represents your interests.
Maybe and maybe not.
In about half the states in the U.S., agents may be "transaction brokers" OR “Discount brokers” who don't have a fiduciary duty to either the buyer or seller. In many states, a customer has the option of signing an agreement for the agent to represent him as a listing agent or as a buyer's agent. Before you start working with the agent, ask about your options and do some of your own research. Most brokerages require buyers and sellers to sign a form indicating that they understand whom the agent represents.