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Are Buyer's Agents (Still) Worth the Money They Charge?

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Services for Real Estate Pros with SMARTePLANS; Houston, Texas

Interesting article on Inman News today. A Listing Agent, Jeff Sibbach,  wonders out loud if in a situation like the one he describes .... is the buyer's agent  "worth" the commission split they are collecting?

 

I can say I have seen quite a few listing agents that I didn't think "earned" the commission they collected .. yes.. those are the ones taking property photos with their cell phones ... among other less-than-optimum marketing practices.

 

But,  he makes the point that since "the internet" (et al) is becoming significantly efficient in helping buyers locate properties -- which was once the nearly exclusive purview of the buyer's agent --- and buyers ARE increasingly doing this themselves..... that perhaps a full commission split is  no longer equitable?

 

"So has the buyer’s agent role changed? Is it fair that buyers are doing the work that the buyer’s agents are getting paid? We believe our industry is about to change."

 

Here is the complete link in case  you need to paste it into your browser:  http://www.inman.com/2016/05/02/buyers-agent-what-does-that-even-mean/

Source: Inman News; May 2, 2016

 

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Judith , The SMARTePLAN Lady

 

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Gary L. Waters Broker Associate, Bucci Realty
Bucci Realty, Inc. - Melbourne, FL
Eighteen Years Experience in Brevard County

Since sellers pay the buyer's agent then there is nothing a buyer should be concerned about when it comes to paying the buyer's agent.  If the buyer wants to risk it by going it alone with the Internet as their guide its simple...caveat emptor.

May 02, 2016 04:41 AM
Judith Sinnard

I agree; I always recommend a buyer utilize a buyer's agent as I think it is in their best interest. His issue seems to be leaning towards perhaps it is time to adjust the traditional percentage"split" btwn listing/buyer's agents, and I'm gathering that you don't really see the need to do that?  Thanks for stopping by.

May 02, 2016 05:01 AM
Chris Ann Cleland
Long and Foster Real Estate - Gainesville, VA
Associate Broker, Bristow, VA

Just because the seller pays doesn't mean buyers shouldn't feel it's a fee they aren't charged.  They are paying for the home, and the fee is coming from the sale of the home.

My buyers have never felt I made too much money.  In fact, most think I don't make enough.  Buyers that only want a rebate need to go find a rebate brokerage and pay for a good outcome. 

May 02, 2016 07:49 AM
Judith Sinnard

Hi Chris, In this case it doesn't appear to be the buyer who is questioning the buyer's fee, but the listing agent. Recall that in the recap the buyer's hold fast to working with their buyer's agents to write up the transaction.  It is the listing agent who felt that perhaps the lion's share of the work was done by his team and therefore perhaps the buyer's agent didn't "earn" a full commission split ... and may be it's time to re-evaluate how that split is calculated?  Thanks for dropping by and commenting.

May 02, 2016 11:16 PM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

My goodness, so someone is asking when a buyer is purchasing what is likely to be one of the most expensive investments in their lifetime, whether they should have professional representation from their agent at a reduced fee?  

A listing agent asking the question may reason that they pay for marketing on their side.  But, I would argue, that buyer agents pay for gasoline on their's.  

The internet has changed things a great deal for buyer agents and listing agents over the years!  It's made our jobs easier, and harder at the same time.  We can market listings easier; but the amount of misinformation disseminated by on-line algorithm generated home evaluators has us spending a great deal of time re-educating our clients to certain realities.

May 02, 2016 11:36 PM
Judith Sinnard

Yes...Myrl... as I gather it, his position is that the listing agent is putting a whole lot more time/effort/money into the sale than the buyer's agent --- because the internet makes it easy for buyers to find their OWN house -- so why should the buyer's agent still get a full split? Is it time to adjust the percentage split? Thanks for coming by and commenting.

May 03, 2016 12:50 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

I might also add that I can remember times when listing agents offered a larger split to buyer agents.  It was seen as an incentive to getting homes shown and sold!

May 02, 2016 11:41 PM
Judith Sinnard

Myrl .. yes I remember... but in a way that kind of agrees with his point. With low inventory levels I think many people will agree that buyer's agents do not have to put in the same level of effort they may have had to do in past seasons --- and he is tying compensation to "effort".  So the corollary is if he advises reducing buyer's commissions now.. does he also advocate increasing them in more difficult markets where the buyer's agent effort is "more"?.  Interesting.. thanks for coming by to comment.

May 03, 2016 12:56 AM
Dave Halpern
Dave Halpern Real Estate Agent, Inc., Louisville, KY (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

Judith Sinnard - Sending you best wishes and hope that you are not being greatly impacted by Hurricane Harvey.

Aug 27, 2017 02:03 PM
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