Do you need to have a realtor?

[First Lady]

Do you need to have a realtor?

For example if you find a home you like, but haven't chosen a realtor yet - do you really need to retain one?
Or can you just deal directly with the one who is listing the home.

Maybe this falls into the "stupid question"; but genuinely curious as to pros and cons.

[Travis Munroe]

Let me ask why you would want the person representing you to also represent the seller whom the realtor has built a stronger relationship with during the course of the listing
vs
Having someone who does not care about the sellers and is genuinely interested in only you as the buyer.

[First Lady]

Let me ask why you would want the person representing you to also represent the seller whom the realtor has built a stronger relationship with during the course of the listing
vs
Having someone who does not care about the sellers and is genuinely interested in only you as the buyer.

Guess this is why I was asking.

Is it truly impossible for the selling agent to act fairly to both parties?

Wouldn't there be some motivation with the commission? I presume they would get a larger % would they not?

If there are two agents sharing the commission isn't it in both their interests to keep the selling price high?

[1stLand]

The Commission a Buyer's agent earns on a $400,000 home offering a commission fee of 3.5% on the 1st $100,000 & 1.5% on the balance is $8,000.

If that $400,000 home is negotiated up to $410,000 - the extra money the Buyer's agent earns in commission is maybe a hundred dollars at best.

Hardly worth it to conspire against your client and work in the Seller's best interest if you ask me. I would rather have a happy Buyer giving me out future referrals for doing such a great job in negotiations.

[First Lady]

The Commission a Buyer's agent earns on a $400,000 home offering a commission fee of 3.5% on the 1st $100,000 & 1.5% on the balance is $8,000.

If that $400,000 home is negotiated up to $410,000 - the extra money the Buyer's agent earns in commission is maybe a hundred dollars at best.

Hardly worth it to conspire against your client and work in the Seller's best interest if you ask me. I would rather have a happy Buyer giving me out future referrals for doing such a great job in negotiations.

Okay, good point on the excess amounts over 100K.

If the commission is the same for both seller and buyers agents; wouldn't a single agent be more likely to adjust it to benefit both parties? For example reducing purchase price for buyer and reducing expense for seller.

[Minnie]

Let me ask why you would want the person representing you to also represent the seller whom the realtor has built a stronger relationship with during the course of the listing
vs
Having someone who does not care about the sellers and is genuinely interested in only you as the buyer.

When we sold our last house, our realtor also worked with the buyer. In the end, I really felt like we got jacked because she promised something to the buyer on our behalf, if he gave us full asking - and she didn't discuss it with us first. I don't know if I've ever been angrier in my life. Sure, we got full asking but it cost us another $700 in the process. If you're going to spend my money for me, you'd better fecking be asking me if it's ok first.

So yeah. If the house is listed through a realtor and not on welist, or FSBO or one of those outfits where you're dealing with the owner on a one-on-one level, I would absolutely get my own real estate agent to help me in the buying process. Never again would we let the other way happen.

[troutman]

Why Use a REALTOR

Value of a REALTOR


http://www.creb.com/public/why-use-a-realtor/value-of-a-realtor.php

[Muta]

I never used a realtor when I purchased my condo from the original owner, just a lawyer. Had absolutely no problems. Do your research on the place and use a combination of wit / common sense when negotiating with the selling party.

Although, I do see there can value in using a realtor, but you don't really need them if you're confident in your own abilities and the transaction is pretty straight foward.

[troutman]

Don't expect a lawyer can give you all the same advice a realtor can (and for free).

[bizaro86]

If the property is listed with a realtor already, there is absolutely no reason to not use your own realtor, and a number of reasons why you really should.

The seller's realtor is hired by and paid by the seller, and will be primarily loyal to them. You will have to act in "customer" status, which means you get less advice than when you're represented by your own agent.

People seem to think they're going to get some sort of commission break for doing this, but in my experience having talked to those who have done it they pay more than they would have if they got their own agent. Having someone asking questions on your behalf is valuable, imo.

I'm not a realtor, but I would never not use one to buy a property I found on MLS.

[Muta]

Don't expect a lawyer can give you all the same advice a realtor can (and for free).

Correct, that's why I mentioned do your own research first.

[First Lady]

If the property is listed with a realtor already, there is absolutely no reason to not use your own realtor, and a number of reasons why you really should.

The seller's realtor is hired by and paid by the seller, and will be primarily loyal to them. You will have to act in "customer" status, which means you get less advice than when you're represented by your own agent.

People seem to think they're going to get some sort of commission break for doing this, but in my experience having talked to those who have done it they pay more than they would have if they got their own agent. Having someone asking questions on your behalf is valuable, imo.

I'm not a realtor, but I would never not use one to buy a property I found on MLS.

Yeah the possibility of a small price break did cross my mind. The property we are looking at has had 2 significant price drops; so it's unlikely that another broker will be able to negotiate it down much more.

However, I can certainly appreciate that having our own representative could still help make the whole process smoother.

With that in mind - What questions should we ask to help us choose one?

[Canehdianman]

I bought my house without a realtor, but I was confident enough to negotiate without one.

I basically deducted the buying agent's commissions from what I would have offered. and told them that was why I was offering such a low amount.

[burn_baby_burn]

A Realtor is cheap insurance. I mean, you are making a huge investment worth hundreds of thousands of dollars. What is a couple extra thousand to make sure it is done right?

[Muta]

What is a couple extra thousand to make sure it is done right?

It's a couple extra thousand.

That money could be used more productively elsewhere at places like Subway, a Best Western or the arcade at the airport.

[Travis Munroe]

Yeah the possibility of a small price break did cross my mind. The property we are looking at has had 2 significant price drops; so it's unlikely that another broker will be able to negotiate it down much more.

However, I can certainly appreciate that having our own representative could still help make the whole process smoother.

With that in mind - What questions should we ask to help us choose one?

You can't think that because they dropped twice already they wont be willing to go down much further. This brings up an additional advantage to having a realtor. In a situation where the property keeps dropping in price I personally would prepare a market analysis on the home and determine what the real asking price should be. If you list 100k over market value and then drop 50k, you as a buyer might think your getting a great deal by having another 20k negotiated off the price.

As for questions to ask... having a instant connection with the real estate agent and having them listen to you while giving pointers would be 2 of the most important things for me if I was looking for one. Additionally, experience is critical.
I would also look for a realtor who sponsors a site that I like to frequent :P

[bizaro86]

Yeah the possibility of a small price break did cross my mind. The property we are looking at has had 2 significant price drops; so it's unlikely that another broker will be able to negotiate it down much more.

However, I can certainly appreciate that having our own representative could still help make the whole process smoother.

With that in mind - What questions should we ask to help us choose one?

Not to be disagreeable, but this is absolutely the wrong way of looking at it. You should try to get it for what it's worth (or less). The asking price really has nothing to do with the value, imo. Two price drops could easily be a seller who needs to sell, and would drop a lot more for a credible offer.

I think you'll almost certainly get a better deal with a realtor, and that's what I would do if I was buying.

As for picking one, I'd build a shortlist of 2-3 via referrals from people you trust and the credible sponsors of websites you enjoy who seem to provide excellent service. Then, meet with them to get a feel for how your personalities work together. Ask what type of things they'd try to point out when you toured a house, what type of negotiating strategy they'd use on a situation like the one you described, and maybe get them to do a market evaluation on the area you're considering.

[afc wimbledon]

I bought my present house without an agent, approached the listing agent set up several viewings, liked the house offered a brutally low offer (250 on an asking price of 280) which teed off the agent no end, told her I didn't care where the money came from, her fee or the vendors as long as I wasn't paying it, it was a dead market at the time and so a week later they accepted.

Mind you this was the 4th house I had bought so had an idea of what to do (know the market and be comfortable being a complete prick) wasn't a problem, still in the house, now worth 800,000.

[First Lady]

Thanks for the feedback everyone and thanks to those who have PM'd me too with additional info. It has been very helpful.

[Winsor_Pilates]

It's hard to track any sort of stat for it, but my experience would say 90% of those buyers who think they're saving by going alone, are actually paying more.

If you came through my listing without an agent, I know I'm likely getting my sellers more money, and keeping more commission. You only person who loses is you.

[Bagor]

It's hard to track any sort of stat for it, but my experience would say 90% of those buyers who think they're saving by going alone, are actually paying more
Actually, it wouldn't be hard to track the stats for it and present the data.

Just as it wouldn't be hard to track the stat for % difference between sale by owners and realtor sold homes. I've been hearing the old realors get x% more for home sales compared to for sale by owners for a few years now yet when asked what this claim is based on get a best answer of "well, it's common knowledge".

If there is indeed great value to be had by retaining a realtor shouldn't you folks be presenting more evidence to back it up?

[troutman]

http://www.trulia.com/blog/dominicrealtor/2011/08/selling_for_sale_by_owner_vs_using_a_realtor

Here are some statistics for the National Association of Realtors:

For Sale By Owner (FSBO) Statistics

FSBOs accounted for 9% of home sales in 2010. The typical FSBO home sold for $140,000 compared to $199,300 for agent-assisted home sales.


http://www.forsalebyowner.com/education/press-coverage/459-for-sale-by-owners-proceed-at-your-own-risk-says-brokers

"According to the NAR, those sales that are negotiated through a real estate broker sell for 16 percent more than if the owner sells themselves. So, even when you consider you're saving the six percent broker's fee you're still losing 10 percent," he said.

http://ezinearticles.com/?For-Sale-by-Owner-Vs-National-Association-Of-Realtors&id=934100

Potential and existing For Sale by Owners should take National Association of Realtors (NAR) ongoing rhetoric with a grain of salt.

[Winsor_Pilates]

Actually, it wouldn't be hard to track the stats for it and present the data.
Do tell?

You could do a sampling of sales with 2 agents vs sales with 1 agent, but the problem would be accounting for actual double ender sales where the 1 agent really had their own buyer clients, or if they were unrepresented buyers suddenly entering alone as we're discussing here.

Just as it wouldn't be hard to track the stat for % difference between sale by owners and realtor sold homes. I've been hearing the old realors get x% more for home sales compared to for sale by owners for a few years now yet when asked what this claim is based on get a best answer of "well, it's common knowledge".

If there is indeed great value to be had by retaining a realtor shouldn't you folks be presenting more evidence to back it up?
Seems even harder to compare, what's your recommendation here?
Considering most FSBO will go through something like Craigslist or Welist, how do we get the sales data to compare to agent listed MLS sales?
If you sell your place on Craigslist, I can't pull the list price vs sale price, days on market, price drops etc. for your property.
Unless these sales are in the same data system(if available at all), we're not comparing apples to apples.

And for the record, I'm not making the claim you've stated about "realtors get X% more...", just questioning your suggestion for easy comparison.

[First Lady]

You can't think that because they dropped twice already they wont be willing to go down much further. This brings up an additional advantage to having a realtor. In a situation where the property keeps dropping in price I personally would prepare a market analysis on the home and determine what the real asking price should be. If you list 100k over market value and then drop 50k, you as a buyer might think your getting a great deal by having another 20k negotiated off the price.


Not to be disagreeable, but this is absolutely the wrong way of looking at it. You should try to get it for what it's worth (or less). The asking price really has nothing to do with the value, imo. Two price drops could easily be a seller who needs to sell, and would drop a lot more for a credible offer.

I think you'll almost certainly get a better deal with a realtor, and that's what I would do if I was buying.


I just wanted to reiterate this advice and again extend thanks.

We did retain a realtor. And we ended up in a situation with multiple people putting in offers.

We were successful and got it for 24K less than the most recent list price.:D

Things moved pretty fast and unfortunately we weren't able to involve any of CP's realtors or mortgage brokers; Troutman however will be handling the legal end of things.:)

[Travis Munroe]

congratulations. That is very rare to have multiple offers on a property and get it for that much less (unless it was a million dollar home)

[First Lady]

congratulations. That is very rare to have multiple offers on a property and get it for that much less (unless it was a million dollar home)

Well, it is in a million dollar community.... that's all I have to say about that. :whistle: