Change. Evolution. It happens in all industries. One the last major changes for Real Estate was the internet. Prior to listings being readily available to all, Buyers had to speak with an Agent as only Agents had access to what was available for sale and could easily search for homes for Buyers. Agents were the gatekeepers to information. This “free information for all” caused disruption for the Real Estate Agent, for consumers it was a huge positive. The industry moved forward and Buyers Agent were still needed and still valued.
The change soon to come is how Buyers Agents are paid. Currently, the Seller pays a fee to the Listing Agent (usually a percentage of the sales price). That fee is split between the Listing Agent and the Buyers Agent. Depending on how ones views it, the fee comes from the Seller proceeds or the Buyers pays the fee as part of the purchase price. Since the fee is paid by the Seller, most Buyers do not see that as a direct cost to them. Depending on how some of the current litigation plays out, going forward Buyers may need to pay that fee to their Buyers Agent. How much? The market will determine that. The fee will likely be based on the level of service the Buyers Agent is offering. Much like other industries, there will be discount options and full service options for the consumer to select from.
Some Buyers may easily be tempted to work directly with the Listing Agent to avoid paying a fee. Buyers need to remember the Seller’s Agent job is to get the highest price and best terms for the Seller. That is their job. If a Buyer works directly with a Listing Agent, that Agent can help them complete paperwork, but they can’t guide, advise, or any other adjective you want to throw in here to help the Buyer out or assist them through the process. The Buyer will need to navigate the entire offer to purchase process on their own.
The Buyers Agent job is to get the best price and best terms for the Buyer and navigate the entire process from Offer to Closing. While price is important, so are the terms – contingencies, dates, etc. There is give and take throughout the entire process from Offer to Closing.
A Buyer’s Agent job is to help Buyers and to assist Buyers. This is what they do. They view homes all the time. They attend Inspections all the time. They write up Offers all the time. Most people purchase a house only a handful of times in their lives. An experienced and active Buyer’s Agent does this all the time. Narrowing down the correct property and the correct neighborhood takes time, lots of time, a good Buyer’s Agent can save you time and effort on this. And, when you find the right home, a good Buyer’s Agent will save you money in negotiating the Offer. Plus, a good Buyer’s Agent should know the local market. Personally, have been in over 1,635 (and counting) homes in my local market in the last six years.
Even if you are local, you might not have much knowledge, just a few Towns over. An Agent with street level knowledge is important. Most Agents know a few Towns extremely well and other Towns in the area decently. A good Buyer’s Agent knows the area, knows the neighborhoods. Knows what is not in the pictures. They will help you to craft a solid Offer that represents a fair market value. If you get into a competitive situation they can help craft a winning offer. If your offer has more than the normal amount of contingencies (a home sale contingency, for example), they can help you craft an Offer to account for that.
Scheduling and viewing homes takes time. There is often back and forth with the Listing Agent and the Buyers Agent to work out a viewing schedule especially if you want to see several homes in a day. You don’t want to be chasing ten Listing Agents for information. Let your Buyer’s Agent do that.
The goal is to get to the Closing. Numerous things can go wrong, a Buyer’s Agent job is to minimize turbulence and keep the momentum going. A good Buyer’s Agent will track the Milestones and provide you with a list of Key Dates. A good Buyer’s Agent will be the communications hub between all parties when appropriate – Buyer, Seller, Attorneys, Banks, Inspectors, Appraisers, etc. A good Buyer’s Agent will employ their office team to help make the process as smooth as possible. At Coldwell Banker Realty, we have a dedicated administrative staff and a dedicated non-selling management team to assist us.
A Buyer’s Agent has great connections in the real estate world. Has a readily available list of home improvement contractors (heating, roofing, structural, electrical, painting, plumbing etc.), one or two good handypersons, a cleaning service, legal referrals and lawn service providers. You should never have to go to Google or the phone book to find help.
Most of us don’t like to negotiate. Get your Buyer’s Agent to do it for you. They will know when to push the Seller some and when not to. Your Buyers Agent has the knowledge, skill, confidence to help negotiate the deal. They can act as a buffer and keep things at a professional level. If you deal with a Listing Agent directly, things can get personal quickly.
A good Buyer’s Agent is your proponent at all times. You have a business relationship with each other. Do take the time to interview a few different Agents. Once it is all over, and you are in your new home, you will be pleased an Agent did all of these things for you.
Buyers Agent’s have always (or should have been) held accountable. Although, since the Seller has paid the Buyer Agent fee, many Buyers Agents have been able to get by with providing less than stellar service. If Buyers start to pay the fee directly they should hold the Buyers Agent fully accountable, should have a contract with the Agent that clear details roles and expectations. Contractors bid on project, provide quotes, and get paid for the work performed. So should your Buyers Agent.
Doug McNeilly is a REALTOR® with Coldwell Banker Realty in Wayland, Massachusetts. He specializes in Wayland, Sudbury, Natick, Framingham and the Greater Boston Metro West Area. He can be reached at firstname.lastname@example.org or www.dougmcneilly.com