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Larry Tollen's Blog

By Larry Tollen | Broker in Durham, NC

My Head is Exploding with Knowledge?

I was sitting at a home inspection in Chapel Hill NC; for an out-of-state Buyer client a few days ago and was pondering the old maxim: Knowledge is Power.   

In today’s Internet driven, 24/7 news cycle world; if there’s one thing we don’t lack it’s the availability of information. I don’t know about you, but there are times I feel like I’m being inundated with information to the point where my head figuratively feels as if it’s exploding. If knowledge is indeed power, than why do I often find myself feeling this way? I believe the reason is that we so often confuse information for knowledge.

Perhaps this is why so many people struggle with making well-informed decisions regarding real estate, their confusing information with knowledge.

I spend at least a couple of hours each day on sites like Zillow, Trulia,  Realtor.com, and others as part of my business and I am regularly amazed at the amount of misinformation I read on these sites by what I believe are good intentioned people. Those of us who engage in social media including myself seem compelled at times to offer online advice. Some good and quite a bit of it not so good. How anyone is to know which is good advice and which is not and which is tainted by the personal agenda of the writer?

The problem with the Internet is that anyone with an internet connection can write anything they want and the person reading it has very little idea of who wrote it and more importantly whether the person who wrote it knows anything about what their commenting on or not and yet I suspect that more often than not they either accept it as actual “knowledge.” Alternately they continue to seek additional input till they reach the critical mass and their heads too feel as if their exploding from all the contradictory input they’ve received.

When it comes to real estate, I think the single most important thing that needs to be considered is that it’s local. Contract laws and procedures vary from state to state. Markets vary widely not only between states but within a state as well. For this reason it’s absolutely essential for buyers and sellers to take the time to find an experienced agent to work with and whom they trust to help them, sift through and analyze all the so-called “facts” that are out there.

Real estate is a much tougher business than most realize. Fully 80% of all new Realtors don’t make it one year. Of the twenty percent that do last more than a year most do considerably less than a single transaction a month. Despite what most people think, the average Realtor earns roughly $40,000 a year in pre-tax income and taxes home less than $30,000 a year. It’s hard to make money let alone gain valuable experience when you aren’t successfully negotiating and closing sales. For this reason I have always suggested to buyers and sellers to interview your agent and do not simply take the first one you talk to. Your statistically more likely to get someone who won’t even be in the business a year or two from now than you are to get an agent who can truly assist you in accomplishing your real estate goals. You should ask any perspective agent how long they have been in the business. Ask them how many transactions they successfully closed this year and last year. (If they are not closing at least 12 transactions a year, keep looking, 18-30 is what accomplished experienced agents average) How many listings do they have now and if you’re selling where and how do they market? It’s completely reasonable to ask them to show you documentation to back up their claims. One of the good things about the Internet is you can easily check Realtors out. Google them and check out their presence on sites such as Realtor.com, Zillow and Trulia. (The Big 3 real estate sites) Have others recommended them on these sites? Do they blog? Take a look and see. Website(s) take a look. Understand we do work in a digital age and if your agent isn’t embracing the Internet, then honestly you’re either working with a neophyte, an unsuccessful agent who can’t afford to, or an experienced agent nearing the end of their career. I’m sure I’ll take some flack for that last statement, but it remains true.

Trying to make sense of the market and figuring out whether you should buy or sell a home is an extremely important emotionally and financially. If you were sick you’d want the best doctor you could find, if you were going to court; the best attorney who specialized in cases like yours and when considering what may very well be the most important financial decision of your life; you want an experienced local Realtor who can help you make sense of your local market and who will be there for you throughout the transaction and long after it’s over. Their out there, you just need to take your time and ask the right questions and when you find them, you’ll be glad you did.

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