Should you hire a broker when selling a property online?

A property sale, just like a purchase, involves various stages and several legal and financial considerations. Assessing the neighbourhood to gauge the demand, determining the right price based on market analysis and effectively marketing the property to attract the attention of prospective buyers – all these require a certain level of exposure to the real estate market. For many first-time homeowners planning to sell their house, these decisions may not be easy. Real estate brokers often prove to be instrumental in successfully closing property deals as they can help find buyers matching the seller’s unique preferences. Hence, before selling a property, it is important to address a key question – whether one should hire a property broker or go for a direct sale. In this guide, we will discuss both the benefits and downsides of having a broker when selling a property.

What is the role of a broker in property transactions?

Real estate brokers are qualified professionals who assist their clients with property sales, purchases or rentals. Typically, brokers serve as intermediaries between buyers and sellers, catering to the needs of both parties. Brokers may be classified based on the specific segments of the market in which they specialise: residential, commercial, industrial or plots. They may also specialise in certain neighbourhoods or cities, depending on their expertise.

Pros of hiring a broker when selling a property 

Offers market knowledge

Brokers, who may either work independently or with a larger brokerage firm, often operate in a specific neighbourhood. Thus, they are likely to develop expertise in that region with a sound understanding of the local market trends, including the changing property rates, the supply and demand trends, ongoing construction activities, etc. Moreover, they would also be aware of the local regulations, helping buyers and sellers in navigating the legal aspects of property dealings.

Property valuation

Property values are determined based on various factors, including location advantages, property type, amenities, property’s age and structural condition and upcoming infrastructure developments. Hiring a real estate broker can be beneficial for a seller in accurately estimating their property’s listing price. They will conduct in-depth market research and compare similar properties in the locality and recommend the right price.

Marketing assistance

Real estate agents also assist their clients in marketing and promoting properties to attract potential buyers. They may utilise online or offline methods or both. Traditionally, brokers have supported their clients through word-of-mouth marketing techniques involving phone calls, physical listings of properties and site visits. However, many brokers today adopt all available digital marketing techniques and tech-enabled services, such as virtual property tours, to help their clients with faster deal finalisation. 

Negotiation during property deals

Brokers serve as a bridge between a seller and a buyer. They can provide offers and counteroffers and navigate the price negotiation stage with ease. This can be highly beneficial to first-time sellers who may find it difficult to handle tricky queries or the demands of prospective buyers.

Documentation and legal formalities

Property sale also involves property inspections, drafting agreements, conducting legal due diligence and handling legal disputes, if any. Sellers may need to comply with local property laws, such as obtaining NOCs from relevant authorities. Brokers may help sellers in completing these processes, including liaising with authorities, and ensure a smooth property transaction.

Disadvantages of hiring a real estate broker during a property sale

High brokerage fees

A property seller may have to pay a specified fee for availing the services of a real estate broker. These charges are based on factors such as the property’s price, broker’s experience and expertise, etc. These rates may also vary depending on the location or state where the property is located. Typically, brokers charge around 1% to 2% of the property’s value during the sale. While these charges may be negotiable, they would still be a significant amount, adding up to the overall costs for a seller. They may reduce the total profit earned by the seller through the transaction. 

Limited control over the process

Once a seller has hired a real estate broker, they are likely to be bound by the broker’s schedule. They may have to adjust to the broker’s techniques and the way the process is handled. Some brokers may push for a quick sale, which may give rise to a conflict of interest. Sometimes, the sellers may have limited or no direct interaction with potential buyers, which may create further disconnect between the seller and the buyer. 

Dissatisfaction with services

Not all brokers are equally skilled or trustworthy. It is essential for sellers and buyers to check if real estate agents are RERA registered. However, there is a possibility that a seller may be dissatisfied with the services provided by the broker. Choosing the wrong broker may cause delays in finalising the deal.

Housing.com News Viewpoint

All property seller’s requirements are unique and may differ from those of other sellers in the same location. Hiring an experienced real estate broker may be an ideal choice for someone who: 

• Is unable to devote sufficient time towards finding a buyer
• Is a first-time owner with limited exposure to the real estate market
• Requires assistance with property visits, negotiations or legal work

Moreover, if there are reliable brokers available in a locality who can help a seller close the deal faster, it is better to approach them to ensure a successful property deal. 

On the other hand, if a seller is confident in handling these property matters and wants to save on the brokerage costs, they can sell the property without a broker while gaining complete control over the process. Further, if one requires assistance in aspects such as legal due diligence, they may hire a lawyer instead of a property broker. Ultimately, the decision lies with the seller and must be taken after assessing their priorities, budget and comfort level.

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