This is a question that comes up all the time. I touched on the question of NOT working with the listing agent in my post yesterday when I talked about how IDX works. Today I figure I'll put a very big misconception to rest about working with listing agents and why you really need a buyer's agent when you buy real estate in Iowa City.
It is a total myth that working with the listing agent will get you a better deal on a house. For some reason there is the perception that working with someone, (the listing agent) who is close to the source, (the home seller), will get you as a buyer more information, more flexibility, better pricing, maybe even a reduced commission... The chances of any of these things happening are slim to none! Listing Agents have signed contracts with sellers. They are there to represent them. Not you. It's really as simple as that. They may have more information, but they won't share it with you. They have a fiduciary duty to the sellers, they're not allowed to. (Material defects of course are a different matter, but they will be in the disclosure documents anyway). As far as price is concerned they won't be in a position to give you any guidance. They can supply you with comparable sales in the neighborhood, but after that their hands are tied. Again, they're representing the seller. Not you.
So let's look and see what a buyer's agent can do for you. First of all, you are ensured personal representation. But what exactly does that mean you ask? Well, the first thing you need to do is throw out the idea that a buyer's agent does nothing more than open doors. Another big misconception. Buyers agents do more than open doors and write contracts. (At least good agents do). A LOT of what a buyer's agent does happens behind the scenes.
I guess since I work predominantly with buyers relocating to Iowa City giving you a rough idea of how things work with me is the best way to illustrate my point. Plus it will give you a base line to work from when you're interviewing agents. This is what "personal representation" means in my world...
Researching viable properties is the first step. The most productive way for me is to send clients ALL homes meeting their criteria and let them eliminate the ones they're not interested in.
(Don't want them standing in front of a property asking why we're not looking at the house next door. If it's a viable candidate it was on the list!) The other thing is that I like to be prepared to answer questions when we're viewing homes. That's why I generally research beforehand and figure out the true contenders and have some background info on those. I'll check the assessor's site. I'll call the agents. Sometimes I get good information from them, sometimes I strike out. Either way I learn something about the agent and that's good for later when it comes to negotiating a contract.
When we're viewing homes I'll be offering my insights on the pros and cons of the property. Looking at it from your vantage point that is, not mine. Recently for instance I was showing homes on a Sunday downtown close to Kinnick Stadium. These folks were moving to Iowa City from out of state and didn't know the area. I pointed out it was unusually quiet and they should drive by on a week day for a real feel of the neighborhood. I also mentioned that on game day it was likely to be a zoo around there. (It had been mentioned in the MLS listing that the street was considered prime parking space for Iowa fans). I wasn't trying to talk them in or out of anything. I just wanted them to know that what they were "buying into." That's what buyers agents do. They make you aware of things you may not come up with, because you have a ton of other things on your mind.
That is actually the part that I think turns the whole idea of working with a listing agent on its head. A GOOD buyers agent will provide you with MORE information than any listing agent, simply by doing their due diligence and informing you of EVERYTHING they find out. A listing agent cannot do that. They can only tell you so much. That's just a fact. Take that one step further and you'll soon realize more information equals power to you in a real estate transaction. The more information you have the better the deal you will be able to negotiate, (with your buyer's agent).
Short disclaimer: Agency laws vary in the different states. If you're reading this anywhere other than Iowa you should contact a local Realtor about how the rules of agency work in your state.
Originally posted @ ichomesforsale.com
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