Is it worth it to use a realtor?

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rob
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Re: Is it worth it to use a realtor?

Post by rob »

No but your going to have to... It's a racket.
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smitcat
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Re: Is it worth it to use a realtor?

Post by smitcat »

EnjoyIt wrote: Fri Mar 17, 2023 2:33 pm
quantAndHold wrote: Fri Mar 17, 2023 10:26 am
jj45 wrote: Fri Mar 17, 2023 10:02 am The most important thing I look for in a realtor is their negotiation skills. Everyone thinks they are a good negotiator, just like everyone thinks they are a good driver, but half of us are below average. A skilled realtor has deep experience negotiating real estate deals, has inside info about the realtor on the other side of the table, and knows the state of the market. Using realtors has earned me much more than they cost.
This exactly. Every RE deal I’ve done has had some negotiation at some point in the deal. Having someone who’s good at that is worth every penny.
Which begs to ask the question. How do you find a good real estate agent?

For example, Although our last agent was very nice, I think they did very little with regards to earning their keep. They had a couple of open houses and when it was time to negotiate, it appeared they goal was to get it sold ASAP as opposed to negotiating in our best interest.

So how does one vet a real estate agent and find one that is worth their 3-6 percent? One can list a house pretty cheap these days with some the online services available.
Realtors that have time and reputation in an area have a vested interest in repeat customers and good reviews. We used local internet sites like nextdoor and reviews to get a list of potentials. We went to open houses to meet some of them and take time to talk about various things not all directly related to home sales.
mnsportsgeek
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Re: Is it worth it to use a realtor?

Post by mnsportsgeek »

You should always use an agent as a buyer. They're free for you.

Selling your house by owner is your choice, but be prepared to invest a bunch of time into it.
DoubleClick
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Re: Is it worth it to use a realtor?

Post by DoubleClick »

mnsportsgeek wrote: Fri Mar 17, 2023 6:39 pm You should always use an agent as a buyer. They're free for you.
See this quote earlier up in this thread:
nerdymarketer wrote: Fri Mar 17, 2023 1:24 am The claim that a "buyers agent is free because it's paid for by the seller" doesn't understand basic economics.
Hence the adages along the lines of "if it's free, you're the product".

Someone had a great analogy for this. It's like saying "I don't care about gasoline taxes because it's the gas station owner who pays them."
cheesepep
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Re: Is it worth it to use a realtor?

Post by cheesepep »

I’ve sold over ten houses/units using a single realtor over the last ten years or so. Only one realtor. Because of that, life was a lot easier for me as she had all of the previous data and knew how to work with me. And she gave me a low commission fee. Not a single issue. I would recommend one.
Normchad
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Re: Is it worth it to use a realtor?

Post by Normchad »

EnjoyIt wrote: Fri Mar 17, 2023 4:55 pm I’m truly curious. For those who have had excellent results with their agent, please share how you found and vetted them. We will be market in about 1 year and would like some direction in finding an agent that is worth their fee.
I don’t actually know a fool proof method for finding a great agent. I’ve had one in the past though, and I found them via word of mouth.

Something they seem to have in common, is they are experienced and seem to know everybody and everything in your market and target neighborhoods.

Here are some of my personal examples.

I wanted to buy a new house in late 2009. When people still thought the entire planet financial system might collapse. Everybody said it was hard to get any loans. I’m risk averse, so,I wanted to buy my new house before I even listed my old house. Folks said I wouldn’t be able to swing this. My realtor hooked me up with a friend at a local bank who made it work. +1 for my realtor.

That same transaction, I was buying a FSBO. The people selling it had no idea what they were doing. They could have sold the house for a lot more money if they had a realtor. They were just dummies. So my realtor basically did all the work for both sides, and made the transaction happen. +2 for my realtor.

And way back when, in another time, we were in the same boat as the OP. We had a house, and contracted to buy a new house. We sold our old house faster than expected, and needed a place to live. Couldn’t find a good month to month apartment. Our realtor knew a guy, who had an unoccupied house that he agreed to let us rent for two months. This wasn’t a house that was normally for rent. And when our construction dragged out longer than expected, our realtor got their friend to let us stay longer. +3 for my realtor.

So for me, that’s the thing. They know everybody. If you have your eye on a particular neighborhood, they know everybody in it. And they know which houses and families might want to sell. (They know that the Carson’s are waiting for junior to move to college in August, then they’re listing the house, for example). In some cases, you get access to houses before they get listed.

A good realtor is definitely worth it. They are better than just using google and Zillow.

Sadly for me, I’m looking to buy a house out of state. So I too will be looking for a realtor, and I might not get lucky this time.
Supergrover
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Re: Is it worth it to use a realtor?

Post by Supergrover »

nerdymarketer wrote: Fri Mar 17, 2023 1:24 am
I've placed an offer before in a very competitive situation where I knew the property I wanted to buy and found a realtor who worked in the same office as the selling realtor. I was glad I did because their pre-existing friendship with the selling realtor resulted in learning some deal dynamics I was unaware of.
I'm glad it worked out for you, but this is part of the problem. This and the whole dual agent BS that lets them out of any responsibility to the buyer.

I want to have an experience like normchad had, but I'm still waiting.
And like another post upthread, it IS a racket, but you need them. I'm surprised the OP, an attorney, doesn't realize this.

My experiences:

House # 1 = my 1st house when I was about 21 - neighbor agreed to sell to me. I brought it to an agent to draw up contract. Realtor said Seller changed their mind. 3 months later I found out the Realtor and her boyfriend bought it (to flip it). I complained to the local NAR and she was sanctioned $1,000.

House #2 smooth transaction. minimal realtor involvement. I found the house on my own...

House #3 - vacation home - had signed contract. A week later my agent called to say Sellers changed their mind. They're going with another, higher bidder. WHAT?? I had a signed contract. I had to get an attorney involved. still own the house 20 yrs later. :happy

House #4 - realtor - dual agent - "forgot" to tell me existence of HOA that required $1,500 catch-up fee. She could've found that out in two clicks. :annoyed

House # 5- Six months ago attempted to buy a great property. Submitted offer, their attorney drew up contract. While the attys were going back and forth, my agent asked me status. I said "almost there."
My/Dual agent told her office mate, the Selling agent, that we did not have a signed contract yet. Two days later they sold to someone else. Which I know happens, but my agent was not protecting or helping me AT ALL.

Still waiting for that happy experience!

OP, you need a bridge loan or HELOC to avoid a short term rental. And you need the realtor to be aware of pocket listings and all the rest.
strummer6969
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Re: Is it worth it to use a realtor?

Post by strummer6969 »

DoubleClick wrote: Fri Mar 17, 2023 3:43 pm
EnjoyIt wrote: Fri Mar 17, 2023 2:33 pm For example, Although our last agent was very nice, I think they did very little with regards to earning their keep. They had a couple of open houses and when it was time to negotiate, it appeared they goal was to get it sold ASAP as opposed to negotiating in our best interest.
This has been our experience every time. Similar on the buying side.
Same. Also on the buyer's side, I find it a huge conflict of interest that they get paid a percentage of the transaction. What motivation is there to reduce the price?
DoubleClick
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Re: Is it worth it to use a realtor?

Post by DoubleClick »

Supergrover wrote: Fri Mar 17, 2023 8:51 pm I want to have an experience like normchad had, but I'm still waiting.
And like another post upthread, it IS a racket, but you need them. I'm surprised the OP, an attorney, doesn't realize this.
Same here, except I gave up on experiences like that materializing. They seem rare in my anecdotal experience and that of friends and acquaintances.

What you're pointing to makes is the need for an attorney on their side IMHO, not the average realtor. In my experience, real estate attorneys usually come at a fixed fee (not a percentage commission). This doesn't setup questionable conflicts of interests. And thus, that racket factor is avoided.

Also, their role in the transaction is well defined, and they value their time, so they're not selling themselves to you all the time, which most realtors do.

Check this thread out for more about someone using lawyers instead of agents.
Last edited by DoubleClick on Sat Mar 18, 2023 6:26 am, edited 1 time in total.
stan1
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Re: Is it worth it to use a realtor?

Post by stan1 »

Hire a realtor who is a good business person. Someone who runs a successful sales business which means closing a lot of sales in your neighborhood. I don't know if this can be generalized but the three best realtors I've ever worked with were all college Division I/II athletes (male baseball, 2x female basketball including one who was a college basketball player in the 1960s before Title IX and then went on to own her own brokerage, development company, and construction company -- that was in a small town and every tradesperson in the town dropped everything to work for her because she treated them with respect and brought them business even in slower times, the entire town respected her)

Don't hire a realtor who is focused on interior design. Paint and even flooring are easy to change. If you are buying a fixer don't rely on a realtor to know how much it costs to do anything.

In the 1980s and 1990s I heard stories of people who would walk through almost 100 houses before finding one they liked. Today we have the internet. When I bought my current house in 2015 the realtor had the MLS set up to email me each day's new listings at 5:00 AM. He asked if I was up that early, I said yes. He said he was up by 6:00 and if I wanted to go see one that day text him and he'd set it up that afternoon. There were multiple offers on the house so we had to bid over ask. We had the winning offer. I told my realtor after the inspection report and the appraisal came in to get as much back as you can. He looked at me funny and said, "really? most people don't say that". He got us $32K back (about 4%). He high fived me when he came to my house to tell me, very proud of himself. So he earned all of his pay. As it turned out the seller's agent was lazy (part time agent) and told his client to accept my agent's offer.
mnsportsgeek
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Re: Is it worth it to use a realtor?

Post by mnsportsgeek »

DoubleClick wrote: Fri Mar 17, 2023 7:17 pm
mnsportsgeek wrote: Fri Mar 17, 2023 6:39 pm You should always use an agent as a buyer. They're free for you.
See this quote earlier up in this thread:
nerdymarketer wrote: Fri Mar 17, 2023 1:24 am The claim that a "buyers agent is free because it's paid for by the seller" doesn't understand basic economics.
Hence the adages along the lines of "if it's free, you're the product".

Someone had a great analogy for this. It's like saying "I don't care about gasoline taxes because it's the gas station owner who pays them."
Realtor fees have no bearing on the cost of the house unless there is a mass group of people who choose to kick realtors to the curb. Don’t hate the player hate the game.
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JoMoney
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Re: Is it worth it to use a realtor?

Post by JoMoney »

FWIW, a "Realtor" is a trade marked term for a member of the professional association that is the "National Association of Realtors"

You can find quite competent and capable real estate agent services from an agency or person that is not a "Realtor."
Some markets have places like "Help-U-Sell" offering licensed agents that can help you with a range of services a Realtor might offer, but at a low flat-fee cost rather than a percentage.
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Re: Is it worth it to use a realtor?

Post by CC1E »

Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
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quantAndHold
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Re: Is it worth it to use a realtor?

Post by quantAndHold »

CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
I’ve never had a realtor do “almost zero work”. If that’s your experience, you’re not hiring the right people.
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Re: Is it worth it to use a realtor?

Post by Supergrover »

I'd glad pay the commission for a Realtor that is loyal and ethical.
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Re: Is it worth it to use a realtor?

Post by Tavistock1 »

CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
Ive followed this thread, and feel compelled to comment given this latest blurb. Note that I’m a decades long Realtor, often worked 7 days/week for over 20 years.

- hire a realtor
- a good realtor knows the market better than most
- a good realtor knows the structure of homes better than most
- though not many are, I’m trained in home inspection. When showing a home, I point out deficiencies that a buyer might not be aware of. I don’t « sell » homes. I look at value relative to a neighborhood, area, the infrastructure of a given home ( ie roof, hvac, possible water issues, Windows, etc. that could cost a buyer considerable $ downstream. I look at taxes and utilities to provide a « true cost to own », etc etc etc)
- over the course of my career, I’ve developed a comprehensive list of trusted providers for nearly any issue that might arise during home ownership. These are trusted, reasonable professionals I provide to my clients on an ongoing basis.
- though not an attorney, I am keenly knowledgable of every clause in a purchase agreement, pointing out the contingencies or « outs » to any given agreement.
- in a prior corporate arena I was extensively trained in and subsequently taught negotiation tactics.
- in my market, though I’m gradually reducing my workload now, I’ve been a leading realtor. A buyer looking for a realtor in my area now may not « find » me, given the criteria noted in this thread. No problem
- my eldest daughter and husband purchased a home about a year ago. I’m not familiar with the area ( major metro). I spent many hours searching for a good realtor. I spoke with several. I finally landed on what turned out to be a terrific agent. Knew every street, was a native with extensive knowledge of the market, was a keen negotiator, etc etc. I’ve subsequently referred several other buyers to this agent, all experiencing the same excellent , comprehensive service.

- as for compensation, while I might reduce cost on occasion ( listing) for either a past client, family member of that client, etc., and certainly during the most recent run up I reduced fees- because it wasn’t in the best interest of the seller to be charged a higher fee given the market. But will say, given the posts about fsbo or the guy who will « sell your home for 1% ! » the level of service will be commensurate with what you pay. These firms are by and large clearing houses, reliant on significant volumes to produce any real income.

- while ( perhaps because of the ease of entry among other issues) there are a significant # of realtors who provide less than stellar service, simply chase the next check, there remain a greater # of true professionals.

Talk to a few. Ask for references. Ask them about negotiation ( ie how they approach). Good luck and feel free to pm me should you have further questions
Outer Marker
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Re: Is it worth it to use a realtor?

Post by Outer Marker »

If selling a property, I would suggest a service like "Clever" or "Ideal Agent" that will list your property for 1% and handle the basics like photos, web placement, showings, etc. Pay the full 3% commission to the buyer's agent - that is the person that actually enables the transaction and you don't want your property to be less lucrative to him/her vis-a-vis competing properties. It is important to have representation on the selling side, because FSBOs are not respected in the marketplace and you will get lowball offers and be shunned by the agent community. Paying the 1% price of entry is worth it, but there is no need to pay 3%. On the buyer's side, you might as well get a buyer's agent because the seller is footing the bill.
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Re: Is it worth it to use a realtor?

Post by Xrayman69 »

CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
Have NEVER paid or accepted 6% total.

Sold 2 properties in Seattle over the past 15 years. Maxed out at 4% as we didn’t want to deal with the hassles of the paperwork and going FSBO. Informed buyers agent that the cap was going to be 4% total and non negotiable. Not a single agent blinked an eye and accepted.

Bought 1 property during this time and found property ourselves. Then found agent that was willing to accept 1% and rebate us 2%.

Bought 1 property in Midwest and same, as Seattle purchase.
Northern Flicker
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Re: Is it worth it to use a realtor?

Post by Northern Flicker »

DoubleClick wrote: Fri Mar 17, 2023 7:17 pm
mnsportsgeek wrote: Fri Mar 17, 2023 6:39 pm You should always use an agent as a buyer. They're free for you.
See this quote earlier up in this thread:
It is not quite so simple. The listing agent takes more liability with an unrepresented buyer, and probably will not lower commission by the amount of the buyer's agent commission. The unrepresented buyer might save about 1-1.5% (and possibly zero) all else equal, but will be negotiating directly with the listing agent, who has more detailed info and knowledge to use to value the property. The listing agent has no obligation to lower the commission paid by the seller for an unrepresented buyer, but may choose to do so.
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VictoriaF
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Re: Is it worth it to use a realtor?

Post by VictoriaF »

Xrayman69 wrote: Sat Mar 18, 2023 3:29 pm
CC1E wrote: Sat Mar 18, 2023 9:21 am Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
Have NEVER paid or accepted 6% total.

Sold 2 properties in Seattle over the past 15 years. Maxed out at 4% as we didn’t want to deal with the hassles of the paperwork and going FSBO. Informed buyers agent that the cap was going to be 4% total and non negotiable. Not a single agent blinked an eye and accepted.

Bought 1 property during this time and found property ourselves. Then found agent that was willing to accept 1% and rebate us 2%.

Bought 1 property in Midwest and same, as Seattle purchase.
I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.

The draft agreement would be in force until December 31, 2023, with 3 months after that of protection period. In other words, I'd depend on this agent for over a year regardless of his performance, and if I used another agent, I'd still owe him 3% of whatever I would have bought.

I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.

Victoria
Last edited by VictoriaF on Sat Mar 18, 2023 5:43 pm, edited 1 time in total.
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Mr.BB
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Re: Is it worth it to use a realtor?

Post by Mr.BB »

When we were house hunting years ago (we were renting at that time), we did some open houses, etc. We walked into this one house and the realtor (a young woman) was just sitting on the couch. Never got up to introduce herself, told us to look around and let her know if we had any questions. I was wondering if the owners understood what a lousy agent that had hired. She even asked us we needed an agent to help us..lol
We did hire an agent a bit later, and we weren't real thrilled with her either. We ended up finding a house being sold by owner. We worked it out ourselves and have been in the same house ever since.
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AnnetteLouisan
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Re: Is it worth it to use a realtor?

Post by AnnetteLouisan »

“Realtor… (1) it’s a profession (2) not just a trade…,”

Anyone know that literary reference? 🤨

I used one when I rented my apartment. After some trial and error, I gave one very specific parameters and they managed to find me something I was very satisfied with.
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Re: Is it worth it to use a realtor?

Post by Northern Flicker »

VictoriaF wrote: Sat Mar 18, 2023 5:33 pm

I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.

The draft agreement would be in force until December 31, 2023, with 3 months after that of protection period. In other words, I'd depend on this agent for over a year regardless of his performance, and if I used another agent, I'd still owe him 3% of whatever I would have bought.

I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.

Victoria
I wouldn't sign that. I bet there are not very many (if any) listings in your area with a 3% buyer's agent commission right now, and you would be locked in.
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VictoriaF
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Re: Is it worth it to use a realtor?

Post by VictoriaF »

Northern Flicker wrote: Sat Mar 18, 2023 6:29 pm
VictoriaF wrote: Sat Mar 18, 2023 5:33 pm I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.

The draft agreement would be in force until December 31, 2023, with 3 months after that of protection period. In other words, I'd depend on this agent for over a year regardless of his performance, and if I used another agent, I'd still owe him 3% of whatever I would have bought.

I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.

Victoria
I wouldn't sign that. I bet there are not very many (if any) listings in your area with a 3% buyer's agent commission right now, and you would be locked in.
I definitely won't sign this agreement. But I am also not sure if I have any obligations to this agent who has shown me the condo. I found the condo myself on Zillow. I contacted him because he has recently closed a contract in that building. He made an appointment with the selling agent and spent over an hour showing me the condo, commenting on the condition of its various elements, and answering my questions. I liked the agent until I received the draft contract.

Victoria
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Re: Is it worth it to use a realtor?

Post by bluebolt »

jj45 wrote: Fri Mar 17, 2023 10:02 am The most important thing I look for in a realtor is their negotiation skills. Everyone thinks they are a good negotiator, just like everyone thinks they are a good driver, but half of us are below average. A skilled realtor has deep experience negotiating real estate deals, has inside info about the realtor on the other side of the table, and knows the state of the market. Using realtors has earned me much more than they cost.
I've had the opposite experience. I am a far better negotiator than the agents I worked with. I had to withhold information from my own agent to make sure they didn't give signals I was willing to go higher.
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Re: Is it worth it to use a realtor?

Post by bluebolt »

quantAndHold wrote: Sat Mar 18, 2023 9:41 am
CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
I’ve never had a realtor do “almost zero work”. If that’s your experience, you’re not hiring the right people.
Or, you're in a seller's market.

I sold my own place. It was probably 10 hours of work over and above what I would have had to do anyway with an agent. Buyer didn't have an agent either. We both had lawyers. Saved $3000/hr for the work I did. Oh, and it went for above asking and was higher than *any* comps in the area.
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Re: Is it worth it to use a realtor?

Post by bluebolt »

Shackleton wrote: Thu Mar 16, 2023 8:56 pm In most areas, you do not have to be a licensed realtor to sell your own home or act on your own behalf when purchasing a home. You may need a real estate attorney depending on the state.

But I do question why you think it was the realtor’s fault that you purchased a house you don’t like…
Are there really places where you can't do FSBO?
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Re: Is it worth it to use a realtor?

Post by stan1 »

VictoriaF wrote: Sat Mar 18, 2023 5:33 pm I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.
You were right to refuse to sign that.

Was this person you were working with advertised as a "buyers agent" specialist? Sometimes people recommend using such agents, my experience is people working as "buyer's specialists" are often less experienced and less successful.

Do you know what neighborhood, or complex even, you want to buy in? If so work with an agent who sells a lot of properties in the location you want to live in. That agent will know the market.
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Re: Is it worth it to use a realtor?

Post by Shackleton »

bluebolt wrote: Sat Mar 18, 2023 7:23 pm
Shackleton wrote: Thu Mar 16, 2023 8:56 pm In most areas, you do not have to be a licensed realtor to sell your own home or act on your own behalf when purchasing a home. You may need a real estate attorney depending on the state.

But I do question why you think it was the realtor’s fault that you purchased a house you don’t like…
Are there really places where you can't do FSBO?
I was covering my bases by saying “most”. I’m sure you can do FSBO in all states, but I do seem to recall seeing that certain east coast states may require an attorney for closing. But I’m too lazy on a Saturday night to look it up. :) And my recall isnt’ what it used to be. And I’ve never bought or sold real estate on the east coast and have no plans to do so, so I’ve never researched it further.
“Superhuman effort isn't worth a damn unless it achieves results.” ~Ernest Shackleton
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Re: Is it worth it to use a realtor?

Post by DoubleClick »

Northern Flicker wrote: Sat Mar 18, 2023 4:41 pm
DoubleClick wrote: Fri Mar 17, 2023 7:17 pm
mnsportsgeek wrote: Fri Mar 17, 2023 6:39 pm You should always use an agent as a buyer. They're free for you.
See this quote earlier up in this thread:
It is not quite so simple. The listing agent takes more liability with an unrepresented buyer, and probably will not lower commission by the amount of the buyer's agent commission. The unrepresented buyer might save about 1-1.5% (and possibly zero) all else equal, but will be negotiating directly with the listing agent, who has more detailed info and knowledge to use to value the property. The listing agent has no obligation to lower the commission paid by the seller for an unrepresented buyer, but may choose to do so.
Precisely why a fixed-fee, *rebating* agent like shopprop.com comes in. They take the percentage commission that any other realtor would take, and rebate it to you. See the thread I linked to earlier.
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Re: Is it worth it to use a realtor?

Post by bsteiner »

bluebolt wrote: Sat Mar 18, 2023 7:23 pm
Shackleton wrote: Thu Mar 16, 2023 8:56 pm In most areas, you do not have to be a licensed realtor to sell your own home or act on your own behalf when purchasing a home. You may need a real estate attorney depending on the state.

But I do question why you think it was the realtor’s fault that you purchased a house you don’t like…
Are there really places where you can't do FSBO?
You may sell your property yourself. You wouldn't be acting as a broker or agent for anyone. You would be the principal.

But some sellers can't find a buyer on their own, and need a broker to find a buyer, or don't want to deal with selling it themselves.
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Re: Is it worth it to use a realtor?

Post by DesertDiva »

joechristmas wrote: Thu Mar 16, 2023 4:59 pm
j.click wrote: Thu Mar 16, 2023 4:48 pm You may wish to consider a buyer's agent. The agent works for YOU but is paid by the seller at closing. We employed one and she was great - knew things we never thought of before...
What is the best way to go about soliciting this type of service? One of my issues is that I simply do not know what these people do or how to go about finding a competent one.

If I use the same person for all three transactions, will I be in a good position to negotiate on the commissions that they charge?
Realtors are notorious for getting credentials and pasting them after their name. Look for one with “ABR” on their business card or other marketing materials. This acronym stands for Accredited Buyer’s Representative.
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Re: Is it worth it to use a realtor?

Post by dcabler »

Not sure if anybody has pointed this out yet, but the term "Realtor" is not equivalent to "Real Estate Agent". All Realtors are real estate agents but not all real estate agents are Realtors. The distinction is that realtors belong to a trade group: "National Association of Realtors"

https://www.realtor.com/advice/buy/what-is-a-realtor/

So, no. You don't HAVE to use a realtor. And you don't HAVE to use a real estate agent.

During previous real estate booms, I know of a number of people who obtained a real estate license (but did not become a Realtor) before selling their own houses in order to have access to MLS and to save on at least half of the commissions.

Cheers.
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Re: Is it worth it to use a realtor?

Post by hand »

VictoriaF wrote: Sat Mar 18, 2023 5:33 pm
I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.
And that's not even the worst of it - I considered using an agent (a family friend!) to find tenants for a rental property.

The agreement they sent over laid out reasonable fees to find a renter, but also would have committed me to paying them 3% when I eventually sold the property - no matter who the selling realtor was!

To this day, I am unsure whether this was a poorly thought out repurposing of a sales agreement for use with rentals, or typical saleswoman sleaze.
I am no longer in contact with this family friend.

Caveat Emptor!

In your case it is worth noting:
1) It is typical (but obviously not legally required) for realtors to waive the difference between actual and contractual fees
2) You have no legal obligation to the agent until you sign, however they likely have procuring cause to capture at least the 2.5% from the selling realtor and likely also an alternate buyer's realtor should you end up buying the place
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Re: Is it worth it to use a realtor?

Post by Stubbie »

muddgirl wrote: Thu Mar 16, 2023 6:49 pm In my experience a good realtor is worth the price. A bad realtor is a millstone. They're not interchangeable unfortunately.
+1!!!
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Re: Is it worth it to use a realtor?

Post by Northern Flicker »

VictoriaF wrote: Sat Mar 18, 2023 6:34 pm
Northern Flicker wrote: Sat Mar 18, 2023 6:29 pm
VictoriaF wrote: Sat Mar 18, 2023 5:33 pm I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.

The draft agreement would be in force until December 31, 2023, with 3 months after that of protection period. In other words, I'd depend on this agent for over a year regardless of his performance, and if I used another agent, I'd still owe him 3% of whatever I would have bought.

I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.

Victoria
I wouldn't sign that. I bet there are not very many (if any) listings in your area with a 3% buyer's agent commission right now, and you would be locked in.
I definitely won't sign this agreement. But I am also not sure if I have any obligations to this agent who has shown me the condo. I found the condo myself on Zillow. I contacted him because he has recently closed a contract in that building. He made an appointment with the selling agent and spent over an hour showing me the condo, commenting on the condition of its various elements, and answering my questions. I liked the agent until I received the draft contract.

Victoria
If you did not sign any agreement, I can't imagine how you would have any legal obligation to the agent.

My take is that if you are doing your own search, and then calling an agent to show you a property, the agent will feel like you are not that interested in establishing a business relationship for the purchase, and may present such an agreement so that they don't show you lots of property, then you write an offer with someone else. Asking you to increase the buyer's agent commission is not something I've heard of in our area, but maybe it happens more than I'm aware.

You may want to consider finding an agent first, then starting your search. If you present that you are looking for a buyer's agent rather than looking to see a property, the agent may consider you to have more loyalty and probably would be comfortable moving forward without a buyer's agency agreement. But the norms in your area may be different. If so, that also would come out when interviewing agents.
Last edited by Northern Flicker on Mon Mar 20, 2023 2:14 pm, edited 1 time in total.
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Re: Is it worth it to use a realtor?

Post by Northern Flicker »

dcabler wrote: Sun Mar 19, 2023 6:01 am Not sure if anybody has pointed this out yet, but the term "Realtor" is not equivalent to "Real Estate Agent". All Realtors are real estate agents but not all real estate agents are Realtors. The distinction is that realtors belong to a trade group: "National Association of Realtors"

https://www.realtor.com/advice/buy/what-is-a-realtor/

So, no. You don't HAVE to use a realtor. And you don't HAVE to use a real estate agent.

During previous real estate booms, I know of a number of people who obtained a real estate license (but did not become a Realtor) before selling their own houses in order to have access to MLS and to save on at least half of the commissions.
I would not hire an agent that did not belong to NAR just because I would question their commitment to keeping up with the most current standards of practice. Many brokerages require agents to belong to NAR.
Last edited by Northern Flicker on Sun Mar 19, 2023 11:40 pm, edited 3 times in total.
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Re: Is it worth it to use a realtor?

Post by dcabler »

Northern Flicker wrote: Sun Mar 19, 2023 12:52 pm
dcabler wrote: Sun Mar 19, 2023 6:01 am Not sure if anybody has pointed this out yet, but the term "Realtor" is not equivalent to "Real Estate Agent". All Realtors are real estate agents but not all real estate agents are Realtors. The distinction is that realtors belong to a trade group: "National Association of Realtors"

https://www.realtor.com/advice/buy/what-is-a-realtor/

So, no. You don't HAVE to use a realtor. And you don't HAVE to use a real estate agent.

During previous real estate booms, I know of a number of people who obtained a real estate license (but did not become a Realtor) before selling their own houses in order to have access to MLS and to save on at least half of the commissions.
That is Realtor capitalized, but realtor and real estate agent are synonymous. I would not hire an agent that did not belong to NAR just because I would question their commitment to keeping up with the most current standards of practice. I suspect that in most places, access to multiple listing services will require NAR membership anyway.
Not just capitalized but a registered trademark. Same with National Association of Realtors.

Cheers
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Re: Is it worth it to use a realtor?

Post by Freetime76 »

alpenglow wrote: Fri Mar 17, 2023 5:43 pm The right realtor is worth it. I recently sold rural property in VT. 2 out of the 3 realtors I contacted were terrible - disinterested and suggested low-ball listing prices. The realtor I went with was amazing. He took the time to walk a large parcel (~40A) and put lots of effort into researching comps. He suggested a listing price 15% higher than the others, marketed the property well, and delivered a full-price offer in under a month.
Great example! A talented realtor is a gem. Wonderful. And rare.

For the OP: Just an opinion: maybe you’d do well with a good realtor to get you and the family through the process. Pick someone experienced, and make sure they have several recent transactions in the genre of house you have/want.

When interviewing prospective agents, have a list ready to go:
- What is the typical days on the market in your area right now?
- What listing price do they suggest? (They get a poor grade if they don’t come ready with comparable sales for your area or whip out a tape measure to get room sizes which is silly at that stage…that should be easy.)
- how will they market your house? (Basically they’ll all say the same thing, but listen to learn)
- How do they handle price adjustments? Negotiating? Inspections/other contingencies? Here, I want to hear how much they share, if they have stories showing experiences, how they handle themselves… not so much looking for an exact answer.
- what would they suggest you do to the home prior to sale?
- how do they handle a sell and then buy move? How realistic is a contingent buyers offer (meaning you want to buy, contingent on selling your home by X date) in your area?
- commission is negotiable to a point. The flat fee listing services- if available in your area - are ok for selling if you’re feeling independent. Otherwise, you can ask what the agent typically charges for commission to him/her and to the buyer’s agent … if you don’t like the amount, you might let them know you can’t possibly do that and let them adjust. Or keep looking. Usually you can get 1% or so off the going rate, but you might need to be persistent. Top agents sell A Lot of homes to make a living - they do not nitpick the 1% in my experience.

You may or may not want to use the same agent for both selling and buying, however I would not sign an exclusive buyer’s agreement until you are making an offer on a house.

Overall: Use the person for advice, perspective, knowledge of different locales/neighborhoods, and any “gotchas” for a home or location. From my agent, I want to hear things like: we need to check the development plan, or watch for an after school bus waiting traffic jam, or this type of house always has an issue with xyz…things I wouldn’t know. It’s my job to compare the location/neighborhood/floor plan with what the family needs. Also, the agent is a buffer between you and the other party. You can use that to your advantage.

Lastly:
1. Assume anything you say to your realtor may be used against you and/or may find it’s way to the ears of the other agent and/or the other party. Even/especially secret :wink: info shared in confidence. You can use this to your advantage sometimes.

2. Don’t be afraid to tell the realtor what Your Family needs. Ask them if it’s feasible and what it will take. Such as, (I’m making this up) we want a 5 bedroom 4 bathroom that we move in before August. We are looking in [ ] price range.

3. Remember that silence is a negotiation tactic. (Whether buyer/seller/agent) :happy
Please spell out new acronyms. Thank you.
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Re: Is it worth it to use a realtor?

Post by DesertDiva »

CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
FSBO listings are often problematic for Realtors because 1) the seller usually believes that their house is worth more than it actually is; and 2) they don’t understand the process and get in their own way.

A FSBO seller will say something like “my neighbor sold their house for $600,000, so my house has to be worth $650,000”. The seller doesn’t realize that will their neighbors house was listed at $600k, the actual sales price may have been different. The neighbor’s house may have different features, square footage, lot size, etc.

Another rationale for an unrealistic price: the seller says “I know my house is only worth $560k, but I put a new roof on my house and did 5 other repairs, so I need to get my money out of it.” Maintenance does not increase the value of the house; it’s just the cost of ownership,

An Buyer’s Agent can approach a FSBO seller if a client expresses an interest in their house. Some FSBO sellers are willing to work with agents for a lower commission. The Buyer’s Agent can continue to offer the same services to their client, including running a market analysis to arrive at a reasonable offer, and so forth.
Last edited by DesertDiva on Sun Mar 19, 2023 7:17 pm, edited 3 times in total.
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Re: Is it worth it to use a realtor?

Post by AnnetteLouisan »

AnnetteLouisan wrote: Sat Mar 18, 2023 5:56 pm “Realtor… (1) it’s a profession (2) not just a trade…,”

Anyone know that literary reference? 🤨

I used one when I rented my apartment. After some trial and error, I gave one very specific parameters and they managed to find me something I was very satisfied with.
One of you must know where the above quote is from. Nicolas?
Last edited by AnnetteLouisan on Sun Mar 19, 2023 7:48 pm, edited 1 time in total.
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Re: Is it worth it to use a realtor?

Post by bluebolt »

DesertDiva wrote: Sun Mar 19, 2023 7:08 pm
CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
FSBO listings are often problematic for Realtors because 1) the seller usually believes that their house is worth more than it actually is; and 2) they don’t understand the process and get in their own way.

A FSBO seller will say something like “my neighbor sold their house for $600,000, so my house has to be worth $650,000”. The seller doesn’t realize that will their neighbors house was listed at $600k, the actual sales price may have been different. The neighbor’s house may have different features, square footage, lot size, etc.

Another rationale for an unrealistic price: the seller says “I know my house is only worth $560k, but I put a new roof on my house and did 5 other repairs, so I need to get my money out of it.” Maintenance does not necessarily increase the value of the house; it’s just the cost of ownership,

An Buyer’s Agent can approach a FSBO seller if a client expresses an interest in their house. Some FSBO sellers are willing to work with agents for a lower commission. The Buyer’s Agent can continue to offer the same services to their client, including running a market analysis to arrive at a reasonable offer, and so forth.
I did FSBO and I knew more about my house, my neighborhood, and comps than any of the realtors I dealt with. Ended up saving a lot of money since the top bid came from a buyer without an agent. I was impressed that some buyers' agents were willing to reduce commission since I made it clear that I was considering price net any buyer's agent commission in evaluating bids.
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Re: Is it worth it to use a realtor?

Post by VictoriaF »

stan1 wrote: Sat Mar 18, 2023 7:29 pm
VictoriaF wrote: Sat Mar 18, 2023 5:33 pm I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.
You were right to refuse to sign that.

Was this person you were working with advertised as a "buyers agent" specialist? Sometimes people recommend using such agents, my experience is people working as "buyer's specialists" are often less experienced and less successful.

Do you know what neighborhood, or complex even, you want to buy in? If so work with an agent who sells a lot of properties in the location you want to live in. That agent will know the market.
I found this agent not based on an advertisement but by looking at recent sales in the building I am interested in and the agents who have facilitated these sales. The agent I contacted works for a large agency and his profile shows that he works on both, buying and selling.

I know exactly where I want to buy: it's a specific zip code with only 3-4 buildings that satisfy my requirements at a my price range.

Thank you for your comments,
Victoria
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Re: Is it worth it to use a realtor?

Post by VictoriaF »

hand wrote: Sun Mar 19, 2023 8:46 am
VictoriaF wrote: Sat Mar 18, 2023 5:33 pm
I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.
And that's not even the worst of it - I considered using an agent (a family friend!) to find tenants for a rental property.

The agreement they sent over laid out reasonable fees to find a renter, but also would have committed me to paying them 3% when I eventually sold the property - no matter who the selling realtor was!

To this day, I am unsure whether this was a poorly thought out repurposing of a sales agreement for use with rentals, or typical saleswoman sleaze.
I am no longer in contact with this family friend.
What a horrible situation! It's great that you have caught it. And I am wondering how many clauses are there in contracts that are not easily discernible by a novice buyer. It also shows that using a "recommended" agent or a friend does not assure quality.
hand wrote: Sun Mar 19, 2023 8:46 am
Caveat Emptor!

In your case it is worth noting:
1) It is typical (but obviously not legally required) for realtors to waive the difference between actual and contractual fees
2) You have no legal obligation to the agent until you sign, however they likely have procuring cause to capture at least the 2.5% from the selling realtor and likely also an alternate buyer's realtor should you end up buying the place
For (1): I would not sign a contract obligating me to pay the difference between 3% and 2.5% even if the agent promised me to wave the difference. From reading this thread, it appears that some agents reimburse buyers even from agreed upon fees. In my situation, the agent, hypothetically, could have signed with me a contract for the "MLS" compensation (whatever the seller offers to the buyer's agent) and then contributed some of his compensation towards the price. Instead, he wanted to charge me for the difference -- and assumed that I would not notice it.

Please clarify (2):
The agent I used, asked the selling agent for a block of time to show to me the place. I corresponded with this agent via email (thus, there is a record) but have not signed anything. If I end up buying this place using another buyer agent, would the first agent be entitled to any compensation from the selling agent or a new buying agent?

Thank you,
Victoria
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Re: Is it worth it to use a realtor?

Post by VictoriaF »

Northern Flicker wrote: Sun Mar 19, 2023 12:43 pm
VictoriaF wrote: Sat Mar 18, 2023 6:34 pm
Northern Flicker wrote: Sat Mar 18, 2023 6:29 pm
VictoriaF wrote: Sat Mar 18, 2023 5:33 pm I am a first-time home buyer in an early stage of the process. So far, my experience was the opposite. A real estate agent from a respectable agency has shown me a condominium and then sent me a draft agreement between his agency (as Buyer) and me. If I had signed that agreement I would have committed to pay to the agent the difference between 3% and the percentage the seller offers. For this particular condo, the seller offers to the buyer's agent 2.5%, and I would have been responsible for the 0.5% difference, which in this case is over $3,000.

The draft agreement would be in force until December 31, 2023, with 3 months after that of protection period. In other words, I'd depend on this agent for over a year regardless of his performance, and if I used another agent, I'd still owe him 3% of whatever I would have bought.

I did not sign the agreement and my attitude to the buying process has changed to the worse. It's a decision-making situation, in which a lot of money is at stake, information is limited, authoritative resources are absent, and a buyer relies on an agent who could be ignorant, negligent, deceitful or all of the above.

Victoria
I wouldn't sign that. I bet there are not very many (if any) listings in your area with a 3% buyer's agent commission right now, and you would be locked in.
I definitely won't sign this agreement. But I am also not sure if I have any obligations to this agent who has shown me the condo. I found the condo myself on Zillow. I contacted him because he has recently closed a contract in that building. He made an appointment with the selling agent and spent over an hour showing me the condo, commenting on the condition of its various elements, and answering my questions. I liked the agent until I received the draft contract.

Victoria
If you did not sign any agreement, I can't imagine how you would have any legal obligation to the agent.

My take is that if you are doing your own search, and then calling an agent to show you a property, the agent will feel like you are not that interested in establishing a business relationship for the purchase, and may present such an agreement so that they don't show you lots of property, then you write an offer with someone else. Asking you to increase the buyer's agent commission is not something I've heard of in our area, but maybe it happens more than I'm aware.

You may want to consider finding an agent first, then starting your search. If you present that you are looking for a buyer's agent rather than looking to see a property, the agent may consider you to have more loyalty and probably would be comfortable moving forward without a buyer's agency agreement. But the norms in your area may be different. If so, that also would come when interviewing agents.
I agree that the best first step is to find a good RE agent. The problem is that I don't know how to select one, and recommendations (online and personal) are unreliable. Even people who are pleased with the outcome don't know what it would have been like if they used another agent. I do have a long list of questions to potential agents, to which I am adding as I am reading this discussion. But in the end, an agent's answers do not guarantee that he will live up to them.

Victoria
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Re: Is it worth it to use a realtor?

Post by hand »

Freetime76 wrote: Sun Mar 19, 2023 2:17 pm
Great example! A talented realtor is a gem. Wonderful. And rare.
...

Lastly:
1. Assume anything you say to your realtor may be used against you and/or may find it’s way to the ears of the other agent and/or the other party. Even/especially secret :wink: info shared in confidence. You can use this to your advantage sometimes.
I am really struggling how to reconcile these two statements.
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Re: Is it worth it to use a realtor?

Post by Hebell »

lthenderson wrote: Thu Mar 16, 2023 4:41 pm
joechristmas wrote: Thu Mar 16, 2023 4:09 pm Is it worth it to engage a realtor before undertaking something like this? Do they actually add value? ...

Would it be better to simply fill out the paperwork to become a real estate broker myself and represent myself in these transactions?
From past experiences of trying to sell a home privately without a realtor involved:

1. Many people don't understand the process. They thought they would be paying me the mortgage or getting a loan from me, etc.

2. I felt as is they were always suspicious of me because I wasn't going through a realtor and was perhaps trying to take advantage of them. I explained that I was merely saving them the 6% in fees they would have to pay by offering the house at a cheaper price. Trust seemed to be an issue.

3. I figured I limited the market pool of people interested in my house (for the previous two reasons) to a small fraction of those interested in it with a realtor involved. After many months of trying to sell my house privately and all the headaches involved such as being there to show it, I enlisted a realtor and sold it within a week.

I've bought both of my houses privately and have had no issues. I haven't had lawyers involved other than what my bank required for loan approval. I've just represented myself and the people I've bought from have done the same. I would do so again in the future. But I realize that I'm probably a small minority of people in the real estate market.
I could have written this myself. My experience was exactly the same. The issue of trust and limiting the pool of buyers is the big issue. I sold a big expensive property in DC myself, and thank God even during the Great recession I had two buyers bidding on the property. But I definitely raised eyebrows, and got a lot of crazy questions and a certain degree of mistrust.

I would only do it again if I were in a primo top-notch location like I was then. I used a realtor in both a rural MD location, as well as down here for selling a Florida condominium.
Northern Flicker
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Re: Is it worth it to use a realtor?

Post by Northern Flicker »

VictoriaF wrote: Mon Mar 20, 2023 10:39 am
I agree that the best first step is to find a good RE agent. The problem is that I don't know how to select one, and recommendations (online and personal) are unreliable. Even people who are pleased with the outcome don't know what it would have been like if they used another agent. I do have a long list of questions to potential agents, to which I am adding as I am reading this discussion. But in the end, an agent's answers do not guarantee that he will live up to them.
Well, trust is a two way street. If there is no buyer's agency agreement, you also are asking the agent to trust that you won't work directly with a listing agent on a purchase after the agent spends 100+ hours identifying, showing, and valuing property for you.
CC1E
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Re: Is it worth it to use a realtor?

Post by CC1E »

quantAndHold wrote: Sat Mar 18, 2023 9:41 am
CC1E wrote: Sat Mar 18, 2023 9:21 am Objectively realtors serve little purpose, especially when the market is hot. But the reality is that a buyer’s realtor won’t tell them about FDBO listings since they want to protect themselves. So you’re stuck using a realtor if you want to get a lot of interested buyers.

Given that they do almost zero work, don’t let them charge you the “standard” 6% sale commission. Should be easy to find one who will do it for 4%.
I’ve never had a realtor do “almost zero work”. If that’s your experience, you’re not hiring the right people.
A buyer’s realtor does some work since they have to run around and let their clients into houses.

A saw another post about the old trick where they get a buyer to sign a contract that guarantees 3% of the buying price no matter what.That’s used-car-salesman level shenanigans! I almost got burned by it when I was younger and buying my first house. Buyer should never agree to pay their agent anything. Seller pays and the agents split whatever that commission is.

The only things I’ve ever seen a seller’s realtor do is come look at house, take some pictures, put the listing in MLS, and facilitate some negotiation. Maybe if the sellers have no idea what they’re doing they do some handholding. If it all adds up to 8 hours of work I’d be amazed. Quite the racket if you can get listings. But anyone can become a realtor after passing an easy test, so there are a lot of them fighting for listings.
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VictoriaF
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Re: Is it worth it to use a realtor?

Post by VictoriaF »

Northern Flicker wrote: Mon Mar 20, 2023 2:43 pm
VictoriaF wrote: Mon Mar 20, 2023 10:39 am
I agree that the best first step is to find a good RE agent. The problem is that I don't know how to select one, and recommendations (online and personal) are unreliable. Even people who are pleased with the outcome don't know what it would have been like if they used another agent. I do have a long list of questions to potential agents, to which I am adding as I am reading this discussion. But in the end, an agent's answers do not guarantee that he will live up to them.
Well, trust is a two way street. If there is no buyer's agency agreement, you also are asking the agent to trust that you won't work directly with a listing agent on a purchase after the agent spends 100+ hours identifying, showing, and valuing property for you.
A buyer's agent needs assurance that his work is compensated. A buyer needs assurance that his contract with an agent is written fairly and the agent complies with it. My first experience with a buyer's agent was alarming: As I wrote above, he sent to me a draft agreement that would guarantee him 3% compensation with the duration until the end of the year (December 31, 2023) plus 3 months (till March 31, 2024).

There was another part of the draft agreement that I have not mentioned earlier. The agreement included an addendum for using a settlement company partly owned by the real estate brokerage, whereas I told the agent during our interactions that I wanted to select a settlement agency myself. The agreement with the brokerage had text to the effect that if I sign it, I agree to all its provisions -- which, I assume, would also include my agreement to use their settlement company.

And so my point is not that a real-estate agent does not need to have assurances that his work will be compensated. My point is that my first exposure to an agent was alarming, and that's even before we signed a contract. From reading comments in real estate discussion forums I am also learning that, after a contract is signed, other problems arise, such as an agent not willing to negotiate on the client's behalf, an agent being unresponsive to client's communications, an agent misrepresenting information about the property, etc.

I am willing to do due diligence, and that's how I identified issues with the buyer's agency agreement I noted above. But I don't have experience in this area, and I don't know how many other issues I may have missed. Also, without legal representation, I can't push back against the agreement because I'll probably be told "This is a standard form and we are not changing it."

When I started looking for real estate lawyers I ran into another problem. In D.C., it's not required and not customary to use an attorney for regular real estate transactions. The lawyers I have contacted either don't do residential transactions, or charge $400-$500/hour, or charge a bit less if I commit to do closing with their companies.

After running into these issues, I have developed a mistrust in the entire process.

Victoria
Inventor of the Bogleheads Secret Handshake | Winner of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)
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