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?

Thank you,

FayeC

Don't sign anything until you find the house you want to buy.

You can sign a piece of paper and be locked into buying through one agent.
This can limit your selection especially if that agent is lazy.

I searched for homes in many different cities (within 100 miles) and went to
many different real estate offices. And I feel doing this gave me the widest
selection. At one office I was told I needed to sign a piece of paper before
they could give me any listings. I said "Bye!" and headed for the door. They
stopped me and said they could make an exception in my case.

These people are not your friends. They will give you the shaft with a
quickness. This is business!

Also what I did was to look on the internet. I found that the agents were
giving me higher priced listings which I was qualified for loan wise, but I
wanted something with lower cost/payments - a fixer upper. They wanted to
sell me a higher priced house with a higher commission.

Eventually I found the house I wanted. Then I hunted down the agent the
house was listed with. And then both the seller and buyer (myself) were
dealing with the *same* agent.

And this really helped the sale go through since the owners were out of
state. There were last minute errors in documents to be fixed. Dealing with
just one agent speeded up this process.

With real estate agents and myself, we can play "telephone tag" all day
long - leaving messages on each others machines. So reducing the number of
telephone tag "players" can be a big help if there are last minute errors
which must be fixed "right now", and signatures are needed from both buyer
and seller "right now".

Just before closing, I kept in constant contact with the agent and I advised
the sellers to do the same (the real estate agent told them they did not
need to do anything else!). The day before closing there were two documents
found with errors which needed buyer and seller signatures. (Not to mention
the document 2 days prior to closing and another 4 days prior to closing!)

"FayeC" wrote in message
...

We are in the first steps of looking for a 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 do not need either a real estate agent or a
lawyer in order to buy a house: but:
1. Agents know the local housing market so can
save you time and grief.
2. In most parts of the country an experienced lawyer is
essential to protect yourself from problems with title
or payments.

You have to be able to trust either when he is
supposedly working for you in your absence.

--
Don Phillipson
Carlsbad Springs
(Ottawa, Canada)

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/