Does it matter if the agent knows my neighborhood?

Local knowledge genuinely matters, since an agent who knows your specific neighborhood can price a listing accurately against real recent sales and know which buyers actually search for that pocket of the city. An agent working from a citywide or metro-wide average may misprice a home or miss the audience most likely to buy it. That knowledge also helps with negotiating repairs or timing, since local context shapes what is normal for the area. Ask any agent you are considering how many recent closings they have had near your specific home.