Buying or selling a home—a large investment for many people —is a decision that demands real estate expertise. The first phone call many people make is to a real estate agent who is also a friend.
While it seems like a good idea in the first place, engaging in a real estate deal with a close friend can also present risks to both parties and to the relationship.
Downsides for Agents
First, consider some of the potential negatives when representing a friend.
- Personality conflicts. It’s entirely possible to enjoy someone’s company at a dinner party and yet still not mesh well in something as critical as a real estate transaction. Think carefully about whether this person will cede control to your professional expertise, or if they will second guess you at every turn.
- Higher expectations. A friend may assume that you’ll go the extra mile for them—and chances are you will—but late-night phone calls and constant texts may be more than your friendship can support.
- Constructive criticism may not fly. Your friend may not appreciate hearing that their barking dog or clutter level are putting buyers off, or that their wish list for a home in their price range is unreasonable.
Emotions can run high during deals, especially in a hot market. In most cases, you can maintain your professional cool, but with people close to you, that might not be as easy.
When you know someone well and understand their life phase, know their likes and dislikes, and want to see them happy with a home, it can be very gratifying to make a deal happen.
The key, as with most relationships, is clear and consistent communication about expectations and how they mesh with the realities of the market—and putting it all in writing. If you’re both in line on philosophy and understand one another, you can help an important person in your life find the right place—a big win for all.
Downsides for Clients
Your college buddy just got their real estate license, and they’re hinting at you to give them a break and let them sell your house. Or a family friend is a seasoned Realtor from out of state and offers to give you remote advice.
Set aside the personal relationship and ask a few questions. Does your personality and approach mesh with this person? Do they take your needs and wants seriously or will they assume only they know what is best for you?
Most importantly, does the agent know the market where you are looking to execute the transaction? Especially when things are moving fast and decisions need to be made on a dime, you need someone you can trust in your corner.
The most serious caveat: If things don’t go well, you may have to consider firing your friend, which could create some tension in the relationship.
If you are lucky enough to have a friend who is also a rock-star real estate agent in your area, you will be the first to know about a new listing or a home that’s about to come on the market.
This professional will also know you well and understand why you want the things you do in a home. A good friend will work even harder than usual to make sure you get the right house or make the best deal.
You’ll also be giving your vote of confidence (not to mention a commission) to someone who is out there working hard in a very competitive business.
The Bottom Line
Consider all of the possibilities listed when deciding to work with a friend. More than likely, working together will benefit both parties. Because making the right moves is crucial in real estate transactions, it doesn’t hurt to think through all of the options. If you have questions about buying, selling, or refinancing your home, contact our seasoned team of real estate professionals at Attorney’s Title Group.