The role of a realtor has changed quite a bit since the advent of the computer and internet. The search and advertisement of the properties was mainly the responsibility of the realtor and the related associations; now that is accomplished through searches on the internet. Each client often spends numerous hours and many months doing research before obtaining the services of a realtor. The realtor no longer escorts the client to each and every property under review. And the realtor associations and multiple listing services no longer control every aspect of the marketing process as the internet becomes the major source for research.
Why use a realtor at all? For people who wish to sell their property, that is often a question related to the expenditure of between four percent and six percent of the sales price. For people who wish to purchase a property, the question of expenditure should never arise as the realtor is paid out of the seller’s sales amount. If we could step away from the fees issue for awhile, which is covered in the fees area of this section, I will attempt to explain the main reasons why a realtor is used in the transaction process.
The main role of the realtor is to act with a fiduciary responsibility for the client during a transaction of property. There are only three professions that act in a fiduciary capacity in most peoples lives: an accountant, a lawyer, and a realtor. Most people have a lot of experience with their accountant and understand that role and how the accountant must act with the best interest of the client and the client’s finances. Most people have some interaction with lawyers and understand how a lawyer must act in regards to the clients personal information and finances. But most people only buy or sell a house every ten years or so. For some people it is a once in a lifetime occurrence. So the vast majority of people do not understand the responsibility of a realtor during the transaction; a transaction that often affects a client’s major portion of their personal wealth. And one that very often includes a lot of downstream work for the client’s accountant and lawyer.
So what does a realtor do? The main roles are to negotiate the transaction, provide and process the legal paperwork, guide the transaction through the title company and banking system, and guide the client through the legal disclosures process. Depending on the client, that may also include many tasks that start much earlier in the process and finish much later in the process.
There are many reasons why the fees are all over the place when it comes to negotiating the listing agent’s commission. Part of it comes down to the company where the agent is employed. A large company such as Coldwell Banker, Alain Pinel, and Intero will have many guidelines for the agent that dictates a general range of commissions. A small company with a single broker agent can negotiate the fees to whatever level of service provided. Each type of realtor has their own qualities.
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