My wife and I are looking to buy a house shortly. In the mean time, we are trying to rent a place for short term until we can buy a house. One of the places I called, said he might be able to help us find a short term rental but I assume that we would need to use him as our buyers agent. He claimed that we would likely get a better deal on a house if we used a buyers agent. The guy sounded a little too smooth for my taste though.
A good one can do a lot of leg work for you, eliminating places that don’t meet your “must haves”. This allows you to use your time more effectivly, and possibly end up in a more suitable house. Just keep in mind that they have a strong financial interest in your closing as quickly as possible, which translates into urging you to make offers on the higher end, rather than the lower.
Two cites that explain it better than I can:
caveat emptor
Buyers agents can be good, if you have never purchased a home before you should probably have one, they know the drill and the pitfalls. The sellers agent does not represent your interests and in fact he effectively doubles his income of he can close the deal this way. If you are fairly house saavy you can probably do ok without it, but real estate can be a tricky biz if you are not familiar with it.
All agents suck and I just fired mine yesterday.
Okay, that’s not totally true. (just the part about the firing) There are good and bad agents out there. I know this because I’ve talked to people who loved their agent. I, however, am cursed to only deal with the twits.
If you think this agent is too slick but you want a buyer’s agent, trust your instincts and find another one. My suggestion is if at all possible get a personal recommendation from someone in your area that had a good agent.
Do not fall into the trap of believing that you absolutely have to have an agent. We bought our first house FSBO with no agent and it was a totally smooth and painless experience. We did our homework as far as researching the home and the area we were buying in and were confident that our offer was fair. (the internet is a wonderful tool) I do not believe a buyer’s agent would have saved us any money. They just would have reduced our bargaining power as the seller would have had to pay our agent.
You should be suspicious of anyone who gets a percentage of the price of the house you buy. That person’s allegiance will most likely be to the commission and not to you. In my experience, a buyer’s agent is no more on your side than anyone else who gets paid upon closing.
We used a buyer’s agent when we bought a house a few months ago. We found a house, made an offer, and it was accepted. The appraisal came in $25,000 lower than our offer. The seller’s agent, our buyer’s agent, and our mortgage broker all wanted us to order (and pay for) another appraisal. They were confident that another appraiser (hand-picked by them) would come up with the right answer. I had to point out to my buyer’s agent that she should be happy for me that I was going to get the house for $25,000 less than I had offered. All she saw was that her commission would be $625 less. When you figure that her agency would take a good chunk of that and taxes would take another good chunk, her actual take would be a couple hundred dollars less than it would have been.
If you want someone to care about your interests, you have to pay that person yourself whether or not the transaction goes through. A good real estate attorney is far more valuable than the best buyer’s agent.
We had a buyer’s agent, but she was worthless. The only valuable thing she did for us was hook us up with her finance guy, who is a straight shooter. She found nothing for us; the place we want to buy, we found ourselves. So we dumped her. Our finance guy and our real estate lawyer are taking care of us. We are smart enough to do research, find out what the place is worth, get the place inspected, and negotiate the price; and having a buyer’s agent would just make it harder to negotiate a lower price. Our lawyer is making sure the purchase and sale agreement is on the up and up. So we are very happy not to have a buyer’s agent.
I guess it’s useful to have a buyer’s agent if you feel you need help finding candidate houses; but in our case, that wasn’t really necessary.
A buyer’s agent is legally obligated to act in the buyer’s best interest.
I understand that. It is a fairly subjective standard, however, and hard to prove in court.
This has been my contention all along, w/ respect to “buyer’s agents”. I think people go the “buyer’s agent” route thinking that they are getting a service that’s mostly illusion. If your going to make, what is for most people, one of the most expensive purchases of your lifetime, I think you should take the time and effort to educate yourself about the process, not trust someone who, in the end, is compensated by your adversary. Just doesn’t make a lot of sense to me. Ethics and laws aside, people are basically greedy, especially when the opportunity is ripe and the stakes are high. You’re just asking to be conned when you put to much trust in a “buyer’s agent”, even an ethical well meaning one.