Why choose a consultant over an agent? The following are examples of some of my experiences with consulting arrangements:
For Sale By Owner (FSBO). The seller called me after he had an interested buyer with whom he was negotiating. The buyer had an agent, and the seller wisely wanted a professional on his side. I explained the purchase contract and required paperwork and met with him a number of times as issues arose. At close of escrow, he had saved more than $10,000 in commissions.
Warning: Selling by yourself can be very time consuming and may save or cost you thousands. Even if you plan to hire a real estate consultant, do not underestimate the process.
Ex-tenant buying from landlord. The buyer was thoroughly familiar with the property, as he had recently lived there. Prior to hiring me, he had agreed upon a price with the owner, but they did not have a written contract.
I was able to put him in touch with an excellent home inspector and pest control operator. The inspections uncovered some problems unknown to the buyer and helped him factor these into his negotiations. The buyer was able to successfully purchase the home for significantly less than if the seller had had to pay a standard commission.
Renter buying from landlord. One of my readers called to ask for help in buying directly from the owner, who lived out-of-town. I gave the renters the choice of hiring me as their agent or as a consultant.
They asked me to be their agent because, if the sale had not closed, they would not have had to pay me anything. It did close, and, for the additional risk of acting as an agent, I was paid quite a bit more than if I had consulted hourly.
Add on, or sell and buy another. I am currently consulting with a couple who is weighing the pros and cons of adding on to their existing home vs. selling it and buying a larger one. There are many variables to consider. We have discussed prices if they sell and buy. I have also helped them get contractor bids for the expansion.
Advice on selling.The sellers had lived in the home for 20 years and had never sold real property before. The house was a "fixer" with extensive deferred maintenance. They hired me to consult about how they should sell (spend to fix or sell "As Is"). I gave them names of various inspectors. After gathering all the information, they decided to sell "As Is." After their home sold and they bought another, they felt consulting had resulted in greater net dollars to them.