Profile picture for Willy04

Is buyer's agent necessary?

I am a first time home buyer and do not fully understand the benefit of using buyer's agent. Buyer's agent does not have any economic incentive to benefit buyers since the commission is paid by the seller (while the contract between a buyer and his buyer's agent bind them to some extend). It seems their only incentive is selling a home with the highest price and least complicated situation regardless of the value.

The condition and value of  homes are investigated by an appraiser and an inspector, so there is little room for agents to chip in the issue.

I understand the buyers agent may arrange multiple showings within a day
and it may be convenient for buyers. However, there is also a disadvantage
that arrangement takes more time and it seems more crucial to make a good
deal.

On the other hand, if a buyer directly contacts the seller's agent, the seller has a huge incentive to sell a home to the "direct" buyer over the other buyers with buyers agents, since he/she can get all commission. Hence, sellers agent has more motivation to provide useful information to "direct" buyers. I heard a claim that buyers agent can "feel out" sellers agents, but I doubt this because of this reason.

So in my understanding, benefits to use a buyers agent are that buyers can:
1) access to the updated MLS information restricted by NAR, and
2) get some advices and remarks from buyers agent due to agent's legal
responsibility rather than their incentives.

Do you have any logical comments and/or objections on the above statements?
Any input is welcome since I do not know this issue well.

Thanks
  • March 23 2010 - US
  • 1
    1Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

Answers (14)

Best Answer

Profile picture for sunnyview
No. Buyers agents are not required, but if you do not use one you need to be able to be familiar enough with the real estate process and pitfalls to avoid trouble on your own. Dual agency often works best and provides the most contractual protection for the seller. The only exception to this is when the buyer has the tools to represent themselves and is getting some benefit either in the deal or in a commission rebate for not having their own agent.

A listing agent has no real responsibility to do their due diligence to uncover defects in the house they are selling. They may recommend an inspector that is qualified, but not a tough customer in the reports they write. They may fail to provide additional information that would cause the buyer to think twice. Dual agents must disclose known issues, but do not need to look hard for providing other reasons for the buyer not to buy. 

It can also be hard for buyers to shield their buying intentions from the the listing agent if that agent is both the listing and buyers agent. Simple things like saying, "we really like the house" or "we were looking at more expensive houses, but this one is priced better" or " we really need to move on this before our lease expires" may signal to the listing agent that thoise are points that can be exploited if negotiations for repairs after the inspection come up or if the seller is advised to remain firm on their listing price. Buying a house is like playing poker. You don't show the other side your cards. Dealing directly with the listing agent makes the buyer's ability to play the game well even more important.
  • March 24 2010
  • 5Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

You always want an agent representing you directly.  If you go directly to the seller's agent they do not represent you, they represent the seller.  It does not benefit the seller to have only one agent on the deal.  The same commission is paid regardless.  If you only have the seller's agent in the deal they will want the highest price and least negotiation to get the offer under contract asap to reduce the change of another incoming offer taking away their double sided deal.  If you have been working with an agent and you happen to look at one of their homes and honest agent will recommend another agent handle the deal during negotiations.  For the most part you will get a better deal and have your interests better protected if you have a buyer's agent.  Find an agent and go shopping.  If you are finding the homes faster than they do, they are not a good agent.  Unless you are constantly searching the actual mls.  Zillow is delayed, so any competent agent will have access to the listing before it hits Zillow.
  • February 27
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for asmus044
The biggest incentive is the commision. Get a realtor so you lower the selling agent's incentive to trick you into a sale.
  • February 27
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Simple answer no it's not.
  • April 05 2011
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Can you purchase a home all by yourself? Of course you can!! However, using a licensed Realtor as a buyer's agent doesn't cost you any money. Wouldn't you rather have a knowledgeable professional in your corner that…

1. knows the market better than anyone
2. is a skilled negotiator that can help you get your next home at your price and close that purchase on your time
3. has access to ALL homes on the market and some that haven't even hit the market yet
4. a Realtor has access to every home on the market and can arrange to let you in on your time.

When a Realtor (Listing Agent) gets a listing from a seller he/she works out a percentage of the sales price for his/her commission. He/She then splits that percentage with the buyer's agent that brings them a buyer. You don't save any money by not using a Buyer's Agent… that just allows the agent that represents the home seller and the home seller's best interest to get paid on the full percentage amount. And without a licensed Realtor looking out for your best interest, you leave yourself open to possibly purchase a home with unknown defects, etc… Having a buyer's agent only helps you.

Why do all the work yourself when you have a free service available to you? Work smarter not harder!!

  • April 05 2011
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

NO you do not need one.
  • April 05 2011
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

You are absolutely right. The listing agent does have a huge incentive to sell you that home.

So the question really is do you have the knowledge and experiance yourself?
  • May 01 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Hi Willy,

A buyer's agent represents you, the buyer, while a seller's agent represents the seller. As a buyer's agent, I owe you the duty of loyalty, but the seller's agent is loyal to the seller. Guess who this will benefit if you use the seller's agent to buy a home? 

Think about a situation where you last bought a car. Who did the sales agent represent? The car dealer, right? And although he or she did a lot of smooth talking, the bottom line is the car salesperson is not working for your best interests, but his or her company's.

Or if you were sued by someone, would it make sense to use the same attorney as the person sueing you? Of course not!  Buyer's representation in real estate is similar, even though it is not (hopefully!) that confrontational. Personally, I always promise both my buyer and seller clients that I will NOT do dual agency, simply because I do not think I can do a fair job to either side while trying to represent both sides of a transaction.

Perhaps the biggest fact that members of the public often don't know, is that your agent's most difficult work for you starts when you write an offer, and doesn't end until you get your keys. Every transaction has problems that crop up. Some require a great deal of determination and expertise to resolve, and you want someone who is watching your back during this time period.  Here's a current example from my own workload: a client found a new construction home and asked me to write the offer as a buyer's agent. The client, against my advice, selected the builder's lender for their loan. Last week, the lender's bank failed. My client lost his loan application deposit, but I quickly wrote an addendum giving him extra time to find a new lender and to extend the closing date if necessary.  This protection I am quite sure would not have happened if my client was using the listing agent. This time, my client followed my advice in selecting a reputable lender.

Whatever you decide, Willy, thanks for writing your question!




  • April 23 2010
  • 1Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

If you took a JC Class on home buying the first thing you would learn is when  you see a for sale sign on a house you may be interested in call the Agent from the next sign you see that's not from the same agency.

Reason being, the seller wants as much as they can get and the buyer wants to pay as little s possible. A listing agents loyalty is to the seller first than the buyer. ..... Happy funding, Rudi
  • April 23 2010
  • 2Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

find a buyers agent you can trust. It will be beneficial in the long run. You will need guidance throughout the process
  • April 22 2010
  • 1Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Hi!  I understand where some of your questions come from, but in all honesty I have to tell you, a Buyers agent is there for the Buyer...  if a buyer were to call on a sign and meet with an agent that is representing the seller then there is no specific loyalty to the Buyer or the buyers needs...  A Buyers Agent would be there for you... 
  • March 24 2010
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Ofe Polack
Hi Willy  Do you really want advice as to whether a buyer agent is necessary or have you convinced yourself that you do not need any help and can do it on your own?  You have had a few very sincere responses prior to mine, but you know what?  I think you should try it on your own this time so that you can see what it all involves, you seem to be very logical and your logic indicates there is not room for a buyer agent.  Go for it!  The best of luck! 
  • March 24 2010
  • 3Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

I suppose if you wanted to look at 50 houses (which isn't an unusual number when buying a home) you could contact 50 listing agents for 50 appointments to see those 50 homes.

Or.

You could use a buyers agent to do the same thing.

If the basis of your presumption is that if you go through the listing agent to buy a home, they will share the buyers agent commission with you; that is a fallacy. There is nothing to prevent the listing agent from keeping the entire fee.
  • March 24 2010
  • 4Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for nwhome.us
You might do a search on this site for others threads about this subject.  Just type "buyer agent" in the search field on the advice tab.  You'll find lots of ideas there so I'll just give you my personal opinion:
1. I help people buy and sell homes 6 days a week, 52 weeks a year.  I've been in this career for about 6 years, so that's a lot of people I've helped accomplish this particular task.  I do appreciate being paid for the time that I spend doing this work.
2. I worked in construction management for about 35 years before I made this change so I also know a little bit about how buildings go together and how Home Owner's Associations function.
3. In my own business model, helping someone through a single transaction isn't the end goal.  The end goal is to provide a service to that person that is good enough that they will recommend me to their friends and family.  There are lots of different models out there to choose from.
4. Some of the information that I provide for my clients does come from the MLS which, by the way, is not associated with NAR in any way.  I share information that I get from the internet, county records, past experience, experience of other agents in my office, news articles that I come across, loan officers, other inspectors, title officers and escrow professionals.
5. Once an offer is made I provide perspective on how the issues that arise fit into the larger perspective of experience.  I provide perspective on time frames for a variety of contingencies that are part of the offer.  I manage risk.  Finding a property is about 1/3 of the way to owning a home.  Getting a deal to close in these times can be a challenge.
6. "Agency" actually has a legal set of responsibilities.  some of us take them seriously.  If your agent is working for you they should be providing you with all of the ammunition that it takes to get the best price and terms for your purchase.  The listing agent represents the seller, or if they are are taking on dual agency, they are tasked to "do no harm to either party".  The third option is for them to write your offer and not represent you at all. There is nothing in that law that states that they have to tell you whether your are getting good value for your purchase or not.  There is nothing there to indicate that they are going to use every means possible to fight for your interests.
7. I don't quite understand your issue with showings.  My clients find the homes that interest them on the internet.  I don't care what website they use and how many homes they/we look at. The place will be theirs and they will take responsibility for choosing which one it is.  I will give them my perspective on whether what they choose is a good value in the current market place and anything that I can contribute from my experience.
8. A Buyers Agency Agreement simply describes what an agent will do and how they will be compensated.  Contracts are used to express a mutual understanding in a relationship so that if the relationship is breached by one of the parties, there is some recoarse.  Most of them include verbage that says that if one party wants to be released from the agreement it can be disolved.  It is usually a good business decision to let the agreement go if there isn't a woking relationship any more.  This is different from breaching the agreement.  If you like what the agreemnt says the agent will do, but don't like the duration or exit strategy, talk about it and amend the agreement until it works for you.  I wish the buyer paid the buyer's agent commission totaly.  It will come and the Buyer's Agency Agreement allows for that.
Have fun
  • March 24 2010
  • 1Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.