Zillow Advice: Finding a buy-side agent - Frustrated with RE agents

I also do not think that ...

Wed, 22 Oct 2008 16:52:00 GMT

I also do not think that agents are "largely a messenger"...there is (or IMHO should be) a lot of activity that happens between the price/terms negotiations and closing. Some properties have much more than others, but a decent agent needs to be prepared for whatever the situation throws at them.

Jimmy: I think the "why" ...

Wed, 22 Oct 2008 16:48:00 GMT

Jimmy: I think the "why" bit is different for each buyer or seller. The right agent for the right client can be a babysitter, a nag, a translator, a scheduling favor owed by an inspector or lots of other jobs the client doesn't want to do or doesn't want to know how to do. What is amazing to one client may be useless to another.

I think I may feel the same way about wedding planners that you feel about real estate agents. I found planning my wedding to be very easy, interesting and a delight. I loved all the little details. It is mind-boggling to me that people would want to pay $5k+ for someone to plan a day where they should want to have their hands in everything...yet many people happily do.

Tiffany, you seem to be arguing ...

Wed, 22 Oct 2008 16:46:00 GMT

Tiffany, you seem to be arguing that the dominance of Realtors and commission-based compensation is a natural outcome of market forces. That's a stretch.

Dept. of Justice Antitrust Division : United States vs. NAR
"In September 2005, the Justice Department’s Antitrust Division filed an antitrust lawsuit against NAR charging that its obstruction of Internet based reatlors and its restrictive MLS policies were stifling competition and hurting consumers. The Justice Department said that these policies prevented consumers from receiving the full benefits of competition, discouraged discounting, and threatened to lock in outmoded business models. "

jfeenick siad: "In the end, ...

Wed, 22 Oct 2008 16:36:00 GMT

jfeenick siad: "In the end, the right agent will be invaluable - it isn't that you don't need an agent, you just need to find yourself a good one."

That is the core claim that we see repeated here over and over -- but again, no real argument why a buyer needs any agent, much less one being paid on commission. If now, in the internet-informed world, the agent is "largely a messenger" -- why is the payment calculated the same way as it was 30 years ago?

Deal is not yet closed - ...

Wed, 22 Oct 2008 14:31:00 GMT

Deal is not yet closed - and so I can't share particulars, but when the deal does close, you'll see that this buyer did exceedingly well.

I agree with all you've said and this fellow can track down information with no difficulty. I recognize that in negotiations my role is largely as messenger, to convey the message of my buyer in form, substance and tone. But stragizing on how to structure the offer and how to communicate it was very collaborative in this case and it was the combined muscle of our knowledge and negotiating skills that allowed us to succeed.

When you think about it, how do you ever know if you got the best price?

Klarek: My point was not ...

Wed, 22 Oct 2008 14:29:00 GMT

Klarek: My point was not that taxes are exactly like real estate commissions. My point was that there are a lot of things people probably should do or know how to do that they choose not to. You may not agree with the fee structure, but people tend to outsource things they don't want to do - whether it is their laundry or oversight and management purchasing a house.

There are a lot of choices out there in how agents can be compensated, but one is more prevalent. It factors in risk/failure to close a deal and may be a remnant from another era...I'm not sure. I know a lot about economics, but would not consider myself an economist. Right, wrong or indifferent it is what the market has brought us as a prevalent compensation structure. You don't have to pay it if you don't want to. You can do the work by yourself. You can negotiate lower commissions or a different structure of compensation. Enough people find it fair enough that they are willing to pay it. It is good marketing? Not worth them investigating? Do they prefer no cash out of pocket unless there is a sale? It could be any combination thereof and many other factors.

One man's easy is another's unwanted burden.

jfee, that doesn't mean that ...

Wed, 22 Oct 2008 13:28:00 GMT

jfee, that doesn't mean that he got the best possible price. As a negotiator, all you do is relay the message. Comparables are very easy to find through online listings and local municipality property records.

"How do I know that an agent ...

Wed, 22 Oct 2008 12:17:00 GMT

"How do I know that an agent gives me the best possible deal?"

The amount of information that is available today makes the transparency of information greater than ever before and buyers very well informed. I am working with a buyer now that makes his living online and I've not run into any piece of information he can't find there. He's knowledgeable and very intelligent and yet he is not trying to buy the home on his own (this is a Home Buying thread right?).

As long as we've worked together - and as much as he trusted me - did the concern that I, as a commissioned sales person, might be motivated to drive up the price cross his mind? I'm sure it did. I know for a fact that his parents voiced that concern to him. The great thing is rather than causing him to be paralyzed by indecision or paranoia, he raised the concern with me.

How did he know that we got the best possible price? Because we negotiated the transaction in such a way to test out the seller's limits. Because he had thorough knowledge of market conditions and real facts on comparables - much of which I'd provided to him. We did better than the best possible deal - because we worked in partnership in understanding the market, the comparable data, and the seller's motivation and hot buttons.

If you do not feel comfortable that your agent is working in your best interests, then you need to keep looking until you find the agent that puts that fear to rest. Ask the question directly and assess their reaction and response. If you don't like the answer move on. In the end, the right agent will be invaluable - it isn't that you don't need an agent, you just need to find yourself a good one.

"I also think people should ...

Wed, 22 Oct 2008 11:47:00 GMT

"I also think people should do their own taxes, or at least be familiar with the system."

Taxes are complicated and time consuming. And it only costs a few hundred dollars for somebody else to do them. Your services cost several thousand dollars, even tens of thousands. It is absurd.

"Even if you did the transaction ...

Wed, 22 Oct 2008 11:46:00 GMT

"Even if you did the transaction yourself, how do you know you got the best possible deal."

All I know when I pay your 3% is that I got a deal. Good deal, bad deal, whatever. By paying an exorbanant amount to an agent, I am in no way insuring I'll get the best deal. I know my local market better than most agents I talk to. Why the flip would you be so arrogant and condescending to assume that I would get the best possible deal through an agent?

How do I know that an agent gives me the best possible deal?