FayeC writes:
We are in the first steps of looking for a house.
We still don't have the down payment (depending on selling another
property out of the country) but we want to do some price research and
figure out what we really need versus what we want before we go out to
open houses and right now going out to open houses would be more like
as tire-kickers than anything else.
While looking around for houses matching our needs in the area we want
one of the real estate agents asked if we were working with an agent
to buy our house.
I didn't even know we needed an agent to *buy* a house.
What would be the benefits of having an agent and what is the average
compensation for agents when buying a house?
You don't _need_ an agent to buy a house, but you may very well want
one.
The short answer is: it depends.
The long answer is more complex.
I'm not a realtor fanboy by any stretch. In fact, i've just sold my
house without an agent other than a flat-fee realtor, and the buyer I
found was one without an agent actually so no commission is udue on
sale.
Even so, the next house I buy I do plan, ironically, to use a buyers
agent IF the house I select is MLS listed. THe reason: I don't know
the market i nthe area I want to buy, and I've found a buyers agent
whose style I REALLY like, who himself has lived in the area for 10
years, and who happens to have faxes of all the floorplans of the
developments in the area handy, and who is a very good negotiator.
If you're going into an area where you aren't terribly familiar with
the properties, you'd be well served to have a real estate
professional who's ostensibly on your side. But never ever forget,
when using a buyer's agent, don't kid yourself--these folks get paid
when the sale closes, so by definition, they aren't really working for
you--they're working for the sale. So choose your personalities
carefully. Trust is paramont.
In our area, the listed commission for buyers agents for properties in
MLS varies from 2% to 3% being offered to buyers agents on single
family homes. 2.5% is considered common, but due to federal laws on
price fixing, Realtors are careful to say that there's no standard.
On the other hand, if yer a wiz on a given area, and are yourself a
good negotiator, and able to represent yourself gracefully, there's a
possibility to save some money by eschewing a buyer's agent, and going
after by owner property (which if you have perfect knowledge of hte
market and what things are worth, you may be able to save yourself
some money... but then again you might be dealing with idiot by owner
sellers with unrealistic expectations of what their home is worth), or
you might be able to negotiate a price better with the listing agent
directly providing you with only minesterial acts. In that case,
around here, the listing agent will be paid a total of like 3.5%
rather than their listing agent commission + buyers agent commission.
Assuming the seller is doing mental math on their net, you might be
able to negotiate a better deal by eschewing a buyer's agent and
negotiating with the listing agent yourself, but you really need to be
on top of your real estate and sales gamemanship to pull that off.
So, in the general case, for MLS listed property listed by full
service realtors with exclusive right to sell contracts (i.e. there's
gonna be a commission paid, no matter how its sold), you're probably
better served by having a buyers agent unless you're a master
negotiateor.
However, if you are dealing with a property in the MLS listed by a
flat fee realtor with an "exclusive agency" agreement, you might be
beter off going in on your own because, there'll be a pretty good
chunk of money your seller will have to pay out if you bring a buyer's
agent along that they wouldn't have to pay if you went in by owner.
How these things shake out varies by state too.
Anyway, with my MLS listed home I sold, an agentless buyer was going
to achieve a better sale price than a buyer with an agent. And they
did. :-)
Best Regards,
--
Todd H.
http://www.toddh.net/