Buying a house? One question to ask your real estate agent

Getting sound unbiased advice about real estate is almost impossible. Asking a real estate agent if now is a good time to buy is like asking a barber whether you could use a haircut. Most real estate agents are ethical, well-intentioned people, but remember: they make their money selling homes, not telling people to keep renting.

When you're talking with a prospective real estate agent, here's a great question to ask them: do you own a home in the area where I'm looking and/or do you own any investment properties here? Find a Realtor who is actively investing in real estate and you've found a Realtor whose putting his money where his mouth is. There are a lot of agents out there preaching the gospel of real estate and then stuffing their commission checks in savings accounts paying 0.3%. This is a good way to screen those clowns out.Real estate agents are very tapped into the status of the market and if they're enthusiastically buying for their own accounts, that's a pretty good sign. It's sort of like investing in shares of a company after seeing that the CEO is buying stock on the open market. It makes sense.

Of course, working with an agent who's genuinely enthusiastic about the market is no guarantee that you'll fare well, but at least you'll be working with someone who is actual experience evaluating properties, not just selling them. And if you end up buying a house that depreciates precipitously, you'll have someone to be friends with at the poorhouse.
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