What homeowners think about realtors in 2024

Are you considering a home sale? Whether you’re exploring the market to sell your property or weighing the benefits of a sale-by-owner (FSBO) approach, it’s crucial to understand your options. Deciding to buy or sell a home is a significant milestone, and it’s essential to consider all factors involved. Working with a realtor can streamline the process, saving you time and effort while maximizing your chances of success. 

A knowledgeable real estate agent, acting as your buyer’s agent or listing agent, can guide you through the complexities of the real estate transaction from start to finish. From conducting home searches tailored to your preferences to negotiating offers and navigating the intricacies of the real estate market, a dedicated agent can be your invaluable ally. Additionally, understanding the agent’s commission structure ensures transparency and clarity

For sellers, the market is booming — but they don’t think it’ll last

One of the most notable findings from the study is that nearly half of the home sellers (45%) think the market is at risk of crashing in 2024. (About 31% say the market won’t crash, while 24% aren’t sure.)

If you take out the unsure respondents, 60% of sellers think we’re in a bubble that might pop, while 40% do not.

This fatalism has translated to action for many sellers, as 35% have moved up their plans to sell their house, in hopes of making a significant profit before a potential downturn. 

These sellers seem to be skeptical or unaware of the current expert consensus that no such housing crash is likely or, arguably, even possible. The subprime loans that fueled the last crash are far less common today. If the housing market takes a hit this year, it’ll likely take the form of a slowdown in price growth, not a 2008-style debacle.

In the meantime, most sellers expect the market to treat them pretty well. Nearly half of the home sellers (43%) think their house will go for more than the asking price, and 28% think they’ll receive an offer on the very first day of listing.

Overall, sellers are so optimistic that more people think their home will set off a bidding war (30%) than think they’ll have trouble finding a buyer (25%). This optimism has sharply increased since pre-pandemic times. In 2019, 15% of sellers expected to accept an offer within two weeks of listing their home, while 28% of sellers expect that today. 

On a longer timeline, 53% of sellers think they’ll accept an offer within a month of listing, which may be low. According to data from the National Association of Realtors, 84% of homes sold in February 2022 were on the market for less than a month.

On other issues, sellers are a little too optimistic. Almost two-thirds of sellers (62%) think it’ll take 10 or fewer showings to sell their home, and 26% think it’ll take five or fewer. In reality, even in hot markets like Portland, Ore., homes take around 25 showings before they get that winning offer.

Seller hopes are tempered by real fears

Interestingly, 74% of sellers fear their homes will take too long to sell. That means a lot of sellers who believe their home is going to sell in a week or two also harbor fears that it may not.

Taking too long to sell was the most commonly cited fear by home sellers. In second place was “settling for a lower price than expected” (69%), followed by “worries about strangers coming into their home” (67%), and “being forced to move out too soon” (66%). 

In fifth place was “a major issue being discovered during the buyer’s home inspection” (62%), which suggests more sellers should consider paying for a pre-listing home inspection if only to put their minds at ease.

Read more: Do I need a realtor if I found a house I already want?

Real estate agents are popular — but a little misunderstood

While sellers’ confidence in reaping a large return on their investment has skyrocketed since before the pandemic, so has seller confidence in real estate agents. In 2019, only 54% of sellers said they planned to use an agent, while in 2022, that number has increased to 77%. 

The increase is even more dramatic among millennial buyers. In 2019, less than half (47%) planned to use an agent, while 80% plan to use an agent today.

Overall, 85% of sellers say a realtor is important or very important to the home-selling process. In a hot market, sellers want an experienced agent who’ll maximize their sale price, as well as manage things like bidding wars and price negotiations.

Read more: Best real estate agent bio examples

Most sellers don’t know what an agent does or how the commission is calculated

One striking takeaway from the study is how few sellers actually understand what a seller’s agent does — and doesn’t — do. Nearly half of the home sellers (47%) think a seller’s agent performs a home appraisal (they don’t), and 42% think a seller’s agent arranges the home inspection (they don’t). 

In fact, only two out of 1,004 respondents were able to correctly pick out the tasks performed by a seller’s agent. 

The confusion extends to the commission, too. Less than half of sellers (46%) are aware that the average total real estate commission they’ll likely pay is 4% to 6% of the sale price — over one-third of sellers (34%) think it’s more than that.

Interestingly, the percentage of sellers who are concerned about overpaying on commission (51%) is very close to the percentage of sellers who couldn’t identify the correct commission rate. 

Education is an easy fix here. Once informed that the average commission rate is 5.5%, a large majority of sellers (69%) said it was fair.

Read more: Tips for pricing your home correctly as a FSBO seller

The way sellers find an agent is undergoing a profound shift

For decades, conventional wisdom stated that the best way to find a real estate agent was a word-of-mouth referral from someone you knew. That’s no longer the case. A surprising majority of sellers say digital methods like online review sites such as Yelp or Google (48%) or real estate websites such as Zillow or Clever Real Estate (54%) are the best ways to find an agent, while only 42% say a referral is the best method.

This illustrates a rapid shift. In 2019, respondents indicated referrals were their top method for finding an agent.

Sellers are using modern methods to find an agent, and they want a modern agent, too. When asked about the ideal amount of experience for an agent, the most popular response was four to six years (45%), followed by seven to nine years (26%), and 10 or more years (19%). 

Sellers know they’re navigating an unprecedented market, and they seem to want an agent who has come up in this new market. This makes sense, considering that the industry is changing so quickly — for example, virtual home tours have only been around for a few years but are rapidly becoming ubiquitous. As the market evolves, so do the approaches sellers take to listing their homes. By staying informed about what other home sellers are doing, homeowners can better position themselves to list their homes with confidence when the time is right.

Read more: How to choose a realtor

Written by Ben Mizes. May 14, 2022

Ben Mizes is the Co-Founder and CEO of Clever Real Estate, the free online service that connects you with top Real Estate Agents who can help you save thousands on commission. Ben is also an active real estate investor with 22 units in St. Louis, and a licensed Real Estate Agent in the State of Missouri.