“How much does a buyer agent cost?”
That’s a reasonable question often asked of me at an initial buyer consultation. At the consult I tell you that I represent only buyers and explain all the things I am going to do to make your new home purchase as easy as possible.
The next question is always “How much do your services cost?”
There is no out of pocket cost for my buyer representation service. I get paid for my service by the listing agent. Through the agent to agent multiple listing service (which you can search for listings here), the listing agent shares their commission for bringing and assisting a buyer in the transaction. The listing agent represents the seller’s needs, I represent the buyer, but we’re both paid from the commission paid by the seller.
Recently I sold a condo in the Back Bay. What made this buyer different was that he knew exactly what he was looking for. Only condos in the Back Bay and within a very specific price range which greatly limited the inventory available. This particular buyer had a list of potential places he had viewed at open houses. He wanted to know if they were still available and if yes could we go back and see them as he was now ready to buy. This buyer was highly educated and knew what he wanted.
I know what you are thinking. If this buyer knew exactly what he wanted then why did he need a buyer’s agent? This buyer also knew that as educated as he is, he is still in no way a specialist in the Boston Real Estate market or in negotiating a purchase. Having the training to represent buyers and the experience of seeing most of the properties on the market on a day to day basis allows me to provide accurate property valuations, quickly spot the great values on the market, and conduct effective negotiations on behalf of my buyer clients.
So much did my services cost this buyer? I would like to think my services were priceless to this buyer! But while they may not be truly priceless, I am certain that I saved him a great deal of money every step of the way.
We went back and saw condos on the list as well as a couple of new condos that fit the criteria before putting in an offer on a Back Bay condo that had great space and lots of potential. The buyer was prepared to write an offer about $10,000 below listing price and was willing to go higher. As this property had been on the market for a little while in a very hot Boston market, I recommended we go in $20,000 below asking. Buyer agreed and we negotiated to a price that was $5000 below where buyer wanted to even start!
Next we had home inspection. Most issues were minor, but it was discovered that electrical needed to be upgraded. After I helped negotiate the electrical deficiencies, the buyer received another $2500 off the price.
On top of that, a special assessment was discovered after signing of purchase and sale and prior to closing. Now, a good attorney at this point can help with proper wording in the purchase and sale agreement to protect the buyer (and ours did in this case) BUT I also had wording in the offer to protect the buyer if a special assessment came up – so there was no way for it to be left out of a purchase and sale agreement. Guaranteed buyer risk protection and another $1400 saved!
All told, at least $8900 saved by hiring a buyer’s agent plus peace of mind. All at no cost to the buyer.