'Word-of-mouth' key in selecting a real estate agent

Finding a good real estate agent is a lot like ferreting out a top-notch doctor. Reputation, experience and specialization are the key attributes buyers should consider when choosing a professional to help them purchase a home, experts say.

"It's really easy to get into real estate. You take a 60-hour course and make a $500 to $1,500 investment," said Carla Cross, who conducts real estate seminars nationally and has written six books on the business. "There is a huge difference in competencies among agents."

Accordingly, home buyers should do some homework before beginning the crucial agent-screening process, experts say.

The first and perhaps most important step to take is to ask for a referral. Walter Molony, spokesperson for the National Association of Realtors, said 44 percent of home buyers locate a real estate agent this way -- and for good reason.

"The reason finding an agent through word-of-mouth is popular is because buying a home is the single biggest purchase you'll make," Molony said. "You need to have confidence in the agent. You need to count on someone to hold your hand."

Another key step is to take a drive through desirable neighborhoods, said James Webb, director of development at the American Real Estate Society. This enables buyers to determine which agents are active in the area based on the number of for-sale signs they have posted on lawns.

Then there's getting up to speed on the Internet. Molony said 74 percent of home buyers use the Web to familiarize themselves with the real estate process, such as which homes are on the market and their price ranges.

"It is such a good tool," he said. "Buyers are much more savvy today. Agents don't have to educate them about the basics."

Once this initial legwork is done, the more critical agent-evaluation process begins. The most basic step a buyer should take is to verify an agent has an active real estate license in good standing, said Erica Wiser of the Denver Board of Realtors. In Colorado, this can be verified by contacting the Department of Regulatory Agency or checking the agency's Web site.

Check that the agent has access to the Multiple Listing Service, or MLS. Most agents do but ascertaining this is important, Wiser said. Without access to the MLS, an agent won't be able to review a full listing of properties for sale.

Cross said buyers should consider real estate agents based on their years in the business, the number of houses they have sold and their familiarity with the neighborhoods of interest.

Experience in real estate is a two-part equation. While at least one or two years in the business is necessary to learn the ropes of real estate, a more important indicator of experience is how much time agents actually spend practicing their skills.

Approximately two-thirds of all agents sell houses as a second career or side business to supplement their incomes, Webb said. Subsequently, "some may only work five to 15 hours a week," he said. "Use a person that does it full time. They'll be on the job 40 to 60 hours a week. They'll be more attentive."

Cross is even more emphatic about part-timers. "Run the other way," he said. "They're not available."

Another indicator of the competence and commitment level of an agent is the number of houses they've sold in the past year. Webb suggests that eight to 10 houses per year is adequate, while Cross said an appropriate benchmark is 12 houses annually.

A prudent home buyer also should look for an agent who specializes in the price range of homes and the neighborhoods the buyer is eyeing. This specialization gives the agent an idea of appropriate home prices, appreciation rates, the quality of nearby schools, the area's crime rate and potential developments coming to the neighborhood, among other things.

Credentials, meanwhile, are another matter. Real estate agents can take a variety of classes in the course of their careers to bone up on a specific topic or area of real estate, but whether this imparts real value for buyers is debatable, Cross said. "Most credentials are meaningless in themselves. What a credential means is that they've been in business long enough to take a course."

Conversely, Molony contends that agents who can list numerous credentials on their business cards show buyers that they are "going above and beyond what I have to do."

Webb agreed. "A person who has made a commitment to continuing education -- that's a good indication of professionalism."

Finally, there are the less-tangible qualities a home buyer should look for in an agent, such as genuine interest and enthusiasm.

"It's a person-to-person business," Cross said. "You should look for an agent who is growing their business and is excited to work with you."

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