Mr and Ms. Buyer, Does Your Real Estate Agent Work for YOU?

By
Real Estate Agent with Chou's Realty

I know you think I am nuts.

Your real estate agent has been diligently sending you property information. She calls for you to make appointments. She shows you the properties. She takes you to open houses. She may even tells you that she can help you negotiate the price when you are ready to make an offer. How can she not be working for me?

Well, in New York, some real estate professionals do not always follow the rule (state law) that says a real estate agent must disclose to you who they really work for. The agent who shows you the houses do not necessarily work for you in a legal manner. If she is a "Seller Agent", she owes her loyalty to the seller, not you. Her job is to get the highest possible price for the seller. By working with you (as opposed to working for you), her obligation towards you is to be fair and honest. That's all.

"But she said she would help me negotiate the price..." you protest.

True, she really means to help you get a price break. You like each other on a personal level and you really feel that you have made a new friend with her. The problem is that many real estate agents do not understand their role as a "Seller Agent" because, on a day-to-day level, they work "with" the buyers, not the seller.

If you really want your real estate agent to do her job properly, you should sign a Buyer Agent agreement with her so that she can now legally help you negotiate. With a Buyer Agent agreement, what you are saying is that Ms. Real Estate Agent, you now work "for" me and you owe your loyalty to me. One of your jobs is to get me the lowerest possible price for the property I want.

"Wait a minute," you say, "If I hire the agent as a Buyer Agent, do I have to write her a commission check, on top of the big check for the purchase price?"

The answer is "not necessarily". Depending on the commission percentage, your Buyer Agent most likely will be able to share the commission that is paid by the seller, not you. Typically, a seller pays the commission to the listing agent who lists the property for sale.  When the property is sold, the listing agent will then share the commission with the other agent who brings in the buyer. The agent who brings in the buyer (You) can be a Seller Agent, or a Buyer Agent. 

So, you and your agent should take a pause and ask yourselves. Who does your agent (legally) work for? 

 

 

Comments (3)

Chris Tesch
RE/MAX Bryan-College Station - College Station, TX
College Station, Texas Real Estate
Sometimes a Buyers Rep isn't enough even.  You need to interview the agent and several others and ask questions.  It helps to have an agent that not only will work for you but works more as a consultant, helping you buy the right home, pointing out resale issues and not pressuring you to make a decision with each showing.
Feb 27, 2008 01:23 PM
Steven Keefe
Coldwell Banker Sky Ridge Realty - Lake Arrowhead, CA

 

So, you and your agent should take a pause and ask yourselves. Who does your agent (legally) works for? 

Did you say "Who does your agent (Legally) works for?

I don't like the connotation you are suggesting.

Feb 27, 2008 01:37 PM
Steve Wong
Chou's Realty - Flushing, NY
Queens New York Real Estate
Thank you, Steven. In this posting I was trying to raise the awareness of buyer representation. In my markets, buyer representation is not common. Not that it's new, but the industry practice does not highlight the distinction between seller and buyer agents. From a real estate practitioner's perspective, sometimes it's hard to do the right thing without losing your customer (not client) to the agent next door, simply because they don't care much about what the law says. Then again Coldwell Banker insists us upkeeping a high standard and I am proud to be on the team.
Feb 27, 2008 02:12 PM