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Are you wondering if you should hire a referral real estate agent? Maybe this is the first time you’ve heard this title, and now you’re just curious about what these people even do.

Either way, we are here to walk you through the basics of working with a referral real estate agent and how to decide if it’s the right strategy for you as you transition into a new property.

What is a Referral Real Estate Agent?

Stop anyone on the street and ask, “Do you know what a real estate agent does?” and you’ll likely receive a confident answer. “Yes, they help you sell your home or buy a new one.” But ask that same person if they know what a referral real estate agent does and you’ll likely receive a blank stare.

Although referrals are a common part of real estate, a general understanding of how they work is still quite foreign to most. Hence the blank stare.

For those in the industry, being a referral agent can be a lucrative way to earn a living. For the average American interested in buying or selling a home, these same agents can be absolute lifesavers when it comes to minimizing stress and maximizing profits.

Here’s why:

Referral Agents Make Connections Happen

A referral real estate agent is a realtor who refers clients to other agents who then partner with the client for the rest of the property transfer process.

The referral agent will be awarded a portion of the commission on the real estate transaction that the new pair complete together for facilitating the match, similar to receiving a finder’s fee in other industries.

To be a referral real estate agent and receive the associated commissions, a realtor must be a member of a brokerage.

Why Do People Use a Referral Real Estate Agent?

Clients typically seek out the services of a referral agent because they might know and trust an agent in their current location. But since they hope to purchase real estate in an area that agent is unfamiliar with, instead of striking out on their own to find a realtor, they trust the connections of the one they already have a relationship with.

It’s truly a win-win-win situation. Think of it this way: the clients are partnered with an excellent new agent, the original agent receives a commission from the partnership, and the new agent receives valuable new business.

For example, Stacy is a home buyer who lives in Dallas, Texas and loves her realtor, John. But Stacy is moving to Columbus, Ohio and, unfortunately, John doesn’t know the market there.

So, if John works as a referral agent, he can connect Stacy with his trusted associated Jane at the Columbus office. This way, Stacy knows she’s working with someone she can trust and John still makes a commission from helping her.

What Does a Referral Real Estate Agent Do?

Since a referral agent’s livelihood usually rests on her ability to generate quality connections between clients and new agents, it is the general rule that you can trust one’s recommendations.

The marketing services a referral agent uses online and within the real estate community should be geared towards creating meaningful partnerships and not generating empty leads. This is because working in referrals is a reputation-based business. A good agent will not jeopardize a potential relationship just for the sake of a quick sale.

It also helps if these agents are strongly visible within the real estate community via a network of other realtors. This helps them be aware of the agents who are currently taking referrals in various popular markets and how these other agents connect with clients.

Once the initial referral takes place, there usually isn’t anything more for the referring agent to do. If you are working with a referrer of quality, you can expect them to follow up and make sure the match is working out. They should also match you with a new agent if things are not going as expected.

Should You Hire a Referral Real Estate Agent?

If you are moving to an unfamiliar market with no connections, it could be in your best interest to hire a referral real estate agent, simply because it would save you the hassle of striking out on your own and attempting to find an agent of quality in your new location.

If you have a local agent or company that you trust, consider contacting them for a referral.

Need a referral? Work with one of our top local agents! With great reviews and a flat rate price, you’ll wonder why you didn’t go with Clever earlier. Call us today at  1-833-2-CLEVER or fill out our online form to get started. 



Andrew Schmeerbauch

Andrew Schmeerbauch is the Director of Marketing at Clever Real Estate, the free online service that connects you top agents to save on commission. His focus is educating home buyers and sellers on navigating the complex world of real estate with confidence and ease. Andrew has worked on projects for the United Nations and USC and has a particular passion for investing and finance. Andrew's writing has been featured in Mashvisor, L&T, Ideal REI, and Rentometer.

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