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Is There a Reason to Hire a Realtor?

Posted by mdfacc (My Page) on
Fri, Mar 5, 10 at 13:55

I'm looking for a house or a lot. I'll buy an existing house if I find a very good value with most of the features I seek. Otherwise, I'll buy a lot and build a custom home.

I've been searching through internet sites and calling the listing agents of properties that interest me. If I find one that I want to buy, I'll have my real estate attorney review the necessary documents.

Is there any advantage to hiring a buyer's agent? Is there any disadvantage relative to my do-it-yourself approach?


Follow-Up Postings:

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RE: Is There a Reason to Hire a Realtor?

Where I live (Ontario) the seller's agent splits the fee paid by the seller. When we bought our existing home 5 years ago, we viewed it using the seller's agent, then found a buyer's agent to ensure we were fully represented during the sale. Didn't cost us anything, so I don't know why you don't do that (or is it not the same in the US?)


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RE: Is There a Reason to Hire a Realtor?

No,but there is no cost to you either as the fee for your agent comes out of selling price,so it doesn't hurt to have a buyer's agent


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RE: Is There a Reason to Hire a Realtor?

Having a good agent provide you the newest information on listings as soon as it's available, should give you an advantage over other buyers, who are doing what you are doing now.
Why give up that advantage when the sel-ler is paying for it?
(spelling changed to avoid embedded links)


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RE: Is There a Reason to Hire a Realtor?

Well, there is a disadvantage in the unlikely event that I want to buy a FSBO. With no realtor, I can obtain a lower price.

Also, I won't stop going to open houses and performing internet research if I sign an exclusive contract with a buyer's agent. If I speak to a realtor at an open house who knows of a listing that appeals to me, but it's not his/her listing, then that realtor won't show me the listing because I'll be bound to my buyer's agent.


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RE: Is There a Reason to Hire a Realtor?

"Well, there is a disadvantage in the unlikely event that I want to buy a FSBO. With no realtor, I can obtain a lower price."

FSBO sellers have already made the decision for THEM to pocket the commission.

They are unlikely to share it with you by adjusting the price further.


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RE: Is There a Reason to Hire a Realtor?

"If I speak to a realtor at an open house who knows of a listing that appeals to me, but it's not his/her listing, then that realtor won't show me the listing because I'll be bound to my buyer's agent."

That's correct.
If just any agent will do, why bother signing an agency agreement, since agent representation is not important to you?
Buyers like you keep the agents compensations higher, I guess that's ok.


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RE: Is There a Reason to Hire a Realtor?

I would continue looking just as you are. If you find an agent you like working with, tell them what you are looking for, but don't sign an agreement with them. If they send you something you like and buy, they will get their commission. If they send you info on something you've already viewed with the LA send them a note to clarify that.
If you find something on your own, you won't be encumbered with them as you would if you signed an agreement.
Keeping your options open is optimal in more ways than just the commission. There is much more to consider when buying a property than commission money or the sales price.


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RE: Is There a Reason to Hire a Realtor?

Md, I would highly suggest hiring a Realtor. It will not cost you anything as the commission is generally paid by the seller, and you will have a professional represent your best interests in what could be a complex process involving your most valuable investment.

Here is a link that might be useful: Maui Real Estate


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RE: Is There a Reason to Hire a Realtor?

we did not use a realtor in our purchase.

we somehow ended up "married" to the realtor that showed us the first home we were interested in. he showed us 17 homes over 3 months. he was selling a house he had flipped and pushed it at us frequently, despite our repeated polite protests that it was nice, but not the home for us. he constantly added homes to our lists that well above our stated price ceiling, and not because he felt they would drop in to our range - forcing me to continually be saying "yes, those are lovely but we can't afford those homes". when we had questions about a property, and he contacted the other realtor, he would hoard the information he was given and only tell us parts of what they said (found this out later) and lastly he messed up an offer on a house and we lost it - and when i pointed out the errors, he said "well i think you really dodged a bullet on that house anyway, do you want to come look at my property again?" grrrrr.

subsequently when i called him to let him know that we would use him if we purchased any of the homes that he had shown us, but that we had decided not to use a buyers' realtor from this point forward, he shouted at me and then hung up on me. and then continued to send me listings as though he was my realtor. grrr!

i know our experience wasn't typical, and because of our inexperience we did not shop for a realtor but rather fell in with the first realtor who showed us a home - but wow! way to put me off on using realtors!

from my perspective:
disavantages of not using a realtor:

it took time to make sure i had checked all possible sources - MLS, zillow, craigslist, courthouse walls, fanniemae/freddie mc, fsbo websites, local ad bulletin - usually daily. we also live in a small community so we had word of mouth working for us.

when we actually got to the stage of negotiating the price, it would have been nice to have a "screen" between us and the buyer, so we wouldn't have had to worry so much about seeming eager.

it also would have been nice to have access to the realtor's list of comps on the house so we would have had an easier time figuring out the house value, although with a little work we were able to figure out the sales prices for most of the houses in the neighborhood from the deeds of trust at the courthouse. that helped.

if we had been looking at a much wider area, it would have been a daunting task, not sure if we could have kept up. so i would factor in how many potential homes you have to sift thru -

advantages of not using buyers' realtor:

often as we looked at a home, we were courted by the listing agent - meaning, the listing agent often considered us as a potential client to show other homes too -- and tried hard to seem efficient, helpful and knowledgable. consequently, they often were very forthcoming about their listing - in fact, i suspect their sellers would have been a little chagrinned at how much we learned about their personal and financial situations and willingness to drop on the price.
(note to self: do not share that info with a realtor when selling home.)

it's not a huge deal, but i think the REA also was pleased to think that they would not have to share the commission, and so were very accommodating to us as buyers. they would ask us what other houses we had looked at, and then promptly fill us in on all the history on the other listings. we learned a lot more than when we had a realtor.

since i watched the mls myself, and tracked houses that matched our criteria - i felt very knowledgable about what a good price per square foot was, how much off the listing price people were selling for, how frequently and how fast homes were selling. in fact, we are closing on a home at the end of this month - and i was a little surprised to realize when i got the appraisal back that i knew the homes used in the sold comparables well.

i did like knowing that the information i gave the realtor was communicated clearly to the seller, and our information transactions were faster, i think.

i think if we had not decided on this home, my next step, based on the very good suggestion of a GW member, would have been to drop off postcards in my desired neighborhoods, indicating that we were looking for a home if anyone was considering selling but reluctant to because of the market.


just my perspective,
hth



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RE: Is There a Reason to Hire a Realtor?

Thank you for the helpful comments, everyone.

Kiki redo, did you use a real estate attorney to draw up your offer documents or otherwise review your transaction? Thanks for your insights.


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RE: Is There a Reason to Hire a Realtor?

kiki, did you ask your original Realtor about representing you as a buyer's agent?

I'd have been frustrated & angry, too, had I spent 3 months showing people a bunch of houses & they "decided to use a buyer's agent".

& had something similar been done to you, I'm sure you'd have been just as angry.


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RE: Is There a Reason to Hire a Realtor?

mdfacc - we have a very excellent and savvy loan officer who checked the wording at each stage. he had us put in a clause saying something like "contract subject to bank approval". it was also reviewed once by a real estate atty. he said it looked fine and suggested no changes.

hi sylvia - either my wording was confusing or we are on different sides of this issue - just in case i want to clarify my wording - i felt at the time that i had behaved honorably but am open to examining my behavior ;)

bob was our buyers agent. when it didn't work out with bob, we did not move to a new buyers agent, we simply acted on our own behalf without an agent. i guess you could call this using the seller's agent.

i understand that bob put some time into setting up the original first day we saw 12 houses. (we drove my car)

we planned to continue with him, as was appropriate - but really - in the next 3 months he found only 3 other homes, all were 50 or 75K too much, even though we were clear about our budget. one of the three was a home he had flipped, which he Pushed us to buy even though we were clear that we were not interested. I asked him to show me two houses I found, and one of these - most importantly, we found out after the fact that he had not followed through on a communication with a seller - it's a long story but in a nutshell we asked him to inquire if they would be receptive to a contingency purchase since our house was in the process of selling. we also indicated taht we'd be willing to rent the house short term or to set up some sort of lease-to-own, since the sellers were distressed and needed out right away. this is a small community, and i ran into the seller a month later after she sold her home on a lease to own. she had never received our communication and our terms would have been acceptable to her. so in my opinion bob cost us a house.

when i politely asked bob about this his response rather than an apology or explanation was to say "well, you really dodged a bullet on that one." baffling.

so really, it is a customer-service type job, and if you don't fulfill your obligations and make yourself useful, you can jeopardize the custom of your customers.

at that point, i did tell him why we were unhappy. i did tell him we would involve him if we bought any of the original 17 houses. i feel like i'm being very well-behaved by NOT sharing my experience with him around locally. Mostly I restrain myself because i feel that some of the original fault was mine, i should have checked out realtors more carefully instead of a crap-shoot. So I accept responsibility for that part of it.

we continued to look for another year (not many homes listing or selling here). we attended open houses, and called the listing agent when we wanted to see something. we explained to the listing agent that we were not using a buyer's agent. they sometimes chose to "woo" us anyway.

it's just my point of view,
but i don't feel he "added value" despite his time invested. and the added value is the whole point of his job.


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RE: Is There a Reason to Hire a Realtor?

kiki-redo-"we somehow ended up "married" to the realtor that showed us the first home we were interested in. he showed us 17 homes over 3 months. he was selling a house he had flipped and pushed it at us frequently, despite our repeated polite protests that it was nice, but not the home for us. he constantly added homes to our lists that well above our stated price ceiling, and not because he felt they would drop in to our range - forcing me to continually be saying "yes, those are lovely but we can't afford those homes". when we had questions about a property, and he contacted the other realtor, he would hoard the information he was given and only tell us parts of what they said (found this out later) and lastly he messed up an offer on a house and we lost it - and when i pointed out the errors, he said "well i think you really dodged a bullet on that house anyway, do you want to come look at my property again?" grrrrr.

subsequently when i called him to let him know that we would use him if we purchased any of the homes that he had shown us, but that we had decided not to use a buyers' realtor from this point forward, he shouted at me and then hung up on me. and then continued to send me listings as though he was my realtor. grrr! "


I don't deny that some agents can be helpful but we just haven't met any yet. The same thing (above) happened to us. Our agent claimed to be a Buyers agent yet showed us houses that were above our stated price ceiling. We asked her to show us houses that were on a minimum of three acres, had woods and were not on top of nearby neighbors. The houses she showed us were in subdivisions with zero trees and close neighbors. It was as if she didn't hear a word we said.
She also neglected to tell us that a couple of the houses we were interested in looking at had already gone into contract.

We started looking ourselves and found the house we would make an offer on. It was a FSBO but we agreed to pay her to help us with the offer/sale. We asked her to please use her buyers agent negotiating skills to help us get a slightly lower price than what the owner was asking. It was in line with the nearby comps (she looked this up). When we sat down with the owner, she sat there like a clam and let us do all the talking. We kept looking at her wondering when she was going to pipe up, but she never did. We were fortunate to be able to talk the owner down 25k.

We had never had a house inspected before but told her we wanted any inspection to include tests for radon and water potability. She recommended an inspector but didn't tell us we needed to request these other tests at the time we made the appt.

The inspector came out and when we asked him to do a radon test he said "you were supposed to ask for that when you made the appt. I'm going to have to come back again". He also said his company didn't test wells and that we would have to find a well driller for that. The well ended up being contaminated and the house tested high for radon so we decided not to go through with the deal. The agent didn't tell us how to go about getting out of it and the seller tried to sue us to go through with the deal. We had to hire a lawyer (and pay for it ourselves) even though she had swore up and down that her agency would use its lawyers to represent us in the event of any problems.

Our contract with her expired and we told her we would not be renewing our agreement. She tried to trick us into signing another contract for a year under the guise of it being an 'exit' contract. Then she accused us of 'hating her'. We had to have our lawyer call her boss and explain why we didn't want to use her again and make sure the contract we did sign wouldn't bind us to her for any future deals. Our lawyer told us that her boss wasn't even aware of the deal she was supposed to be helping us with. She was going to pocket ALL the money and not tell him!

Our lawyer told us if we didn't want to hire another agent, we could use him for any future deals. We took his advice!

We are still looking, but at least we don't have someone working against us or wasting our time showing us houses we aren't interested in. We've learned plenty along the way and feel confident that we will get something worth waiting for in the not so distant future.


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RE: Is There a Reason to Hire a Realtor?

dreamgarden - sorry you are having such a tough time, hope you find your home soon! i feel your pain! ;) very similar dynamic.

mdfacc
i was trying to think of anything that had gone amok during the process or that we had to give special consideration to -

hope to close end of march - *crosses fingers*

we submitted our initial offer in december -
we tried to word the contract so that we would be sure to close in time to get a 6K tax credit, but we were also willing to give the buyer time to find a new home before she vacated, to make her transition easier - so i remember worrying about the language of when we would close and when we could take possession - we wanted to be flexible for the seller, but wanted to protect our deadline for the 6K.

the house had an obvious structural issue, and so we agreed to split the cost of having a very excellent and expensive structural engineer/home inspector come and give us a report. their realtor worded the contract so they paid half of the structural and we paid half of structural and all of the home inspection portion 25-75. based on my conversations with them, i thought we'd split the cost 50-50 but realized after the fact that the wording was clear, i just hadn't checked it carefully. anyhoo, just be very very careful looking at any wording the seller alters!

we then renegotiated the price to accommodate the structural repairs needed. i think dealing directly with the seller's realtor this time helped us because she was able to clearly see our conviction that if the price didn't accommodate the repairs we would walk away.


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