When buying a home, a real estate agent’s role is critical to your success. Whether you are a seasoned veteran or first time buyer, not using an agent to buy a home will cost you more money.
Today, I’m going to shed some light on the important things a buyer’s agent does and why you’d be making a mistake if you didn’t use one to buy. ( and note, using a buyer’s agent is FREE ).
There are rules regarding who represents whom during a real estate transaction. Here in Ohio, an agent can represent a seller, a buyer, or in theory, both, although to that I say neither.
I’m not going to get into the legalities here, but whether you are going it alone or not, it is critical that you understand state agency laws before you enter into any agreements.
BUT I DON’T NEED AN AGENT?
A real estate transaction can be very complicated. An experienced agent has seen it all and has the knowledge and resources to navigate a buyer through the myriad of problems that can arise.
While some transactions go smoothly, most do not. There are problems that come up on every transaction that you cannot always prepare for. With negotiations, inspections, financing, and the tremendous amount of paperwork, something always seems to come up during every transaction that can cause it to fall apart.
When you use an agent, you also get the backing of their company, which includes a seasoned manager and legal department. When problems occur, even minor ones, having a team behind you every step of the way makes a world of difference.
I WILL GET A BETTER DEAL WITHOUT MY OWN AGENT
Anyone who thinks that working directly though the listing agent will get you a better deal is kidding themselves. Are you really naïve enough to think the seller will provide you, some stranger off the street, a discount of thousands of dollars out of the kindness of their heart simply because you don’t have your own agent? I’ll dispel that myth with the following example:
Let’s say I am selling my personal house ( and pretend that I am not a licensed agent )and have hired an experienced listing agent to help me sell it. The real estate commission has already been agreed to in advance before the sign ever goes into the ground. That is a fixed cost of doing business.
So, you come to the picture without an agent and want to buy my home. I couldn’t think of a better scenario because my agent will take you to school. Instead of getting some perceived discount, they will likely get you to overpay, or at least pay more than a buyer who has an agent representing their best interest.
This is nothing against you, but my skilled experienced agent knows a heck of a lot more about negotiating a home than you do. Advantage me!
Remember, my agent represents me, the seller, and their job is to me the highest price possible. That is their fiduciary responsibility. Your goals and needs simply don’t matter.
I’LL JUST WORK WITH THE LISTING AGENT
Many buyers end up doing this, and again, pay the price. I’ve heard things like “I met the agent at the open house and she was so nice and helpful…..”
Of course she was. If you don’t have an agent, the listing agent makes twice as much money. Many listing agents will actually tell an unrepresented buyer that they’ll get a better deal working directly with them just so they’ll forego using an agent. A better deal? For whom? The listing agent, yes, but you, I think not.
EMOTIONS WILL GET THE BEST OF YOU
One of the best things an agent does for a buyer is to help them with the emotional aspect of the buying process. Don’t discount this skill because many of my clients have referred to me as their personal therapist.
Buying a home means packing, moving, spending a lot of money, one of the most emotional times in a person’s life. Add to that having to deal with different personalities on the other end ( the seller ) that you cannot control and you get a recipe for an emotional cocktail that will explode if not managed properly. Even the most mild mannered people tend to get highly emotional during a purchase transaction.
Here are things that some of my clients, the nicest people in the world, have said while negotiating their home:
“These sellers are jerks, I can’t believe they won’t accept our price.”
“They are being ridiculous , what a bunch of a—holes. I don’t even want to buy their home now.”
“If they don’t accept our latest counter, they can take their home and shove it up their ….”
Ok, you get the point. In reality, most buyers and sellers are perfectly good people. During a transaction however, emotions will overpower logic and reasoning and get the best of everyone if you let it.
That’s why having an agent, someone who is not emotionally attached to the transaction, to guide you is invaluable.
I’M STILL NOT CONVINCED
Ok, here’s one last try. Ask yourself this question: If you had to go to court, would you hire your own attorney?
That’s an analogy we use a lot because a successful real estate transaction occurs with two different agents, each representing their own client.
Would you want the other person’s attorney representing you as well, knowing their loyalty and fidiciuary duty lies with the other party?
Or would you prefer to represent yourself, thinking that you can possibly out duel someone who has more experience and knowledge that you do?
How about if you could get a great attorney to represent you and the other party had to pay for it? If that sounds like the best option, then you should hire your own buyer’s agent. If not…
I get it, some folks are narrow minded and simply need to do things on their own. To those people I say “good luck”, as a fool and their money are soon parted.