1) Both buyers and sellers pay commission
During a real estate transaction, it’s the sellers who pay the commission through a listing fee. As a buyer, you pay no commission. This is why you should use a buyer's agent. They will search for homes for you, schedule showings, write the contracts, and handle any potential problems without costing you anything. Using a buyer's agent is more important than ever in Bozeman's current real estate market! With a low supply of homes coming on the market and high demand, having an agent watching for new listings for you is essential.
2) Real estate agents can only show listings from within their office
This myth is more common than you would think and absolutely not true. The reason to use an agent is to have access to all homes currently for sale. As a home buyer, you can tell your agent the criteria of what you are looking for in a home such as the number of bedrooms, location, etc and they will run a search of all the current listings and schedule showings. This is not only convenient but also the most effective way to view homes. In fact, we can set up new listing notifications for you so you are alerted right away when something new comes on the market.
3) It’s very difficult to get a mortgage without a substantial down payment
Things have certainly changed from the days before the credit and housing crisis, however, it is possible to get a loan with a smaller down payment. Having good credit and a solid income history are big factors that will work to your advantage with this. Click here for more ways to financially prepare for buying a home in Bozeman's market.
4) In a strong market like Bozeman, you should price high
False. When considering the selling price it’s important to have your agent do a comparative market analysis to see what homes in the area are currently selling for and then using that along with other factors (such as upgrades, remodels, etc) to determine the best price. Pricing high means it could sit on the market longer or not appraise, even in Bozeman's current seller's market.
5) Agents get paid a salary
While there might be some rare cases where a brokerage pays agents a base salary, this is not common practice. Generally, agents are independent contractors who get paid on commission. Another common myth that is along these lines is that they get the whole commission, which also isn’t true. The commission is split between the selling and listing agent and a portion is paid to the brokerage. On top of that many agents pay a portion for marketing/advertising fees and some pay desk fees. This goes to show that agents are working hard for their part of the commission in a real estate transaction.
6) Home Inspections are pass/fail
A home inspection isn’t giving the home a pass or fail grade. They are meant to assess the condition of a home. Generally, if there are problems on the inspection there is time for this to be remedied or amend the original offer. In any case, the home doesn’t "fail" and the sale can still proceed.
7) Zillow Zestimates are accurate
According to this Washington Post article, Zestimates can be 10 to 20 percent or more off the actual value of a home. These aren’t great statistics when coming up with a home value. In a non-disclosure state such as Montana, these can be even further off. This is why it is always best to have a local real estate expert help you determine the value of your home.
8) Agents get kickbacks from lenders/title/inspectors
Since 1974 it has been against the law to receive an incentive from real estate vendors. Agents and vendors work together in many real estate transactions, so it's normal for an agent to have recommendations for clients. Rest assured, however, kickbacks are not the reason.
9) With all the online real estate sites, you don’t need a realtor
It's true you can easily search for homes on countless websites. However, a real estate agent can make the process so much easier. Often you don't know if the home online is already under contract when you search websites so you can end up wasting time on listings that aren't available. Agents can pull what is active with the criteria you are wanting, schedule showings, and then navigate the world of inspectors, appraisers, lenders, and title companies. Using an agent rather than the online world is the best way to get the most accurate information.
10) In a hot market like Bozeman, you should just "For Sale by Owner"
It's easy to think that in a fast-moving market like Bozeman, all you have to do is put a sign in the yard and you'll have multiple offers by the end of the day. However, there are factors to keep in mind when selling your home on your own. Pricing right, all the paperwork, scams, liability, so many things can go wrong. Hiring a professional is the way to go.