Realtor Observation

Miscellaneous and Personal Stuff I Must Share
1

I have an observation about real estate agents in regards to seller’s/buyer’s agents. It seems that when we had a buyer’s agent, her total focus was on us buying something. Every single place we looked at, she’d say, “So, do you wanna buy it?” Hmmm… I thought she was going to help us pick it apart – you know, get us what we were looking for, while making sure we didn’t get screwed. We ended up deciding on a property, but it seemed like she was working for the sellers. She just wanted a sale. Well, that contract fell through for other reasons.

On this current deal, we decided to dispense with the buyer’s agent and negotiate ourselves. We contacted the seller’s agent directly and made an offer to her and, we lowballed the shit out of the price. We ended up getting the $455K house for $405K, and we started at $400K. The seller’s agent worked on the sellers until they caved. We threw the number out there and she did all the negotiating. It was almost as if she was, you guessed it, a BUYER’S agent! So, this fast-talking manipulative little vixen bullied these soon-to-be retired seniors out of their home for a price I gather they’re not too happy with. In each case, the bottom line was that the realtors just wanted the sale, regardless of who they were representing. I know this is a big duh, but it was never so obvious to me.

So of course there is all sorts of remorse from the sellers. Their agent has been trying to get out of the contract all sorts of ways. It’s really turning into something ugly here, for them. Like I told the realtor yesterday, “All you and the sellers had to do was say no to my offer. We’re not canceling the contract. We want the house.”

Comments, thoughts, flames?

2

Did you actually have a “buyer’s agent” or did you simply, as a buyer, contact an agent to help you find homes? If you don’t have a signed buyer’s agent agreement, the agent works for the seller. In either case, even if the agent’s legal responsibility is to get the seller (or the buyer) the best possible deal, they generally only get paid if a deal is done, so their primary motivation is to convince both parties to agree to terms.

What’s funny is that we, as customers, don’t want to pay agents for the time they spend on our case if we don’t buy/sell anything. We then get mad because they always push to close the deal.

In a tepid defense of the buyer’s agent you had, they don’t ever really know what you are looking for. If they show you a house that meets your general requirements (# of bedrooms, price, space, etc.) whether or not you want it is only known by you. At most she can suggest that the price is too high, she can’t be knocking homes too hard.

3

Depending on where the house is, what condition the house is in, and how long the house was on the market, maybe that price is pretty good for them.

If the House was in McLean, then you got the ultra bargain of a lifetime and their agent must have hypnotized them. If the house is in Woodbridge then they got a good deal and should be happy.

4

Oh, that sounds familiar. The first time we were house shopping, our buyer’s agent tried to push us into any number of properties just to be rid of us with money in her pocket.
I remember one in particular - it was a horrible terrible awful house, and over priced to boot.
The rooms were too small - they were cozy!
The house didn’t have the amount of space we wanted - but we could build an addition!
The house was 10’ from a busy street - but we’d never hear the traffic once we learned to ignore it!
:dubious:

The sellers in your situation must be at least somewhat comfortable with the offer, or very anxious. Otherwise they were free to decline it. No one held a gun to their heads and made them accept (I’m assuming - one never knows in this market).

We sold a house last year. After the contract was accepted and signed by both parties, the (buyer’s) agent did everything in her power to try to nickle and dime more out of us. Again and again we had to point out to her “that the contract states that the situation is X.” Weasel.

I hate everything to do with home buying/selling and hope never to move again. Ever.

5

How does that work?

Are you saying that if you called an agent to help you find a house, he’d only show you houses with sellers he represented, or are you saying that, as you go from house to house, he’s suddenly become under the employ of whoever currently owns it, only to switch allegiance as soon as you went to another?

Either way sounds wrong to me.

6

Who pays the agent normally? It is the seller, so that is who the agent is officially working for.

In Freakonomics there was an interesting section comparing house purchase and sales made by agents versus those made by them for their clients. IIRC, the agents took longer for their own properties but got better deals. Even with a buyer’s agent, the more time the agent spends with you the lower her hourly rate for the sale, and the higher the chance you’ll walk. That goes for both the buyer and the seller. Yes, the seller’s agent would like to get a higher price, but I bet she’d like volume more - and she definitely doesn’t want to lose the sale.

In the old days the main benefit of an agent for a buyer was having access to the MLS book. Now a lot of information is openly available, and no doubt more trustworthy. An agent you know might tell you some little secrets about the house and neighborhood, but for the most part if you like a house you won’t find about the weekly visits by the motorcycle gang until it is too late.

And congrats to the OP for a good deal. In today’s market people are worried about selling at all, so it is time for a bargain. The Times had an article about how people are irrationally attached to a given price for a house. If the sellers had refused and waited longer, they might have gotten less.

7

From REALTOR.com

Their duty is to the seller, and changes depending on who is selling the house they are currently showing. They don’t work for the buyer without a specific (and usually restrictive) agreement.

At best, they want the buyer to be “happy” because that means they will get to be involved in that buyer’s purchase. Note, however, that their “duty” to the seller doesn’t simply mean “squeeze every buyer for every penny” it can also mean “get the seller to agree to a good deal.”

8

More of an observation than anything:

A real estate agent, even a Realtor ™, is in sales. Their interest is to close a sale and get paid their commission.

I expect them as a matter of good professional conduct to look out for their client’s interests in closing a good sale, where “good” is defined (often vaguely) by the client.

9

Realtor here, but everything I say must be considered in light of the state I work in. Other states have different laws and agency arrangements.

In Wisconsin, if a buyer walks in to my office, I don’t have to establish an agency relationship with him at first. But when negotiations begin, I must ask him to make a choice and I become either a Buyer’s Agent or a Seller’s Sub-Agent.

If he wants me to represent him (much as an attorney would in a court case), I hand him a Buyer Agency form to sign and he becomes a client.

If not, I hand him a Customer Disclosure form and he becomes a customer. Note that even though I will be representing the Seller as a Sub-Agent, I have duties to treat all parties fairly and there are many laws about what can, must or must not be disclosed.

If the Buyer is purchasing a listed property, the commission is paid by the Seller. Membership in the MLS (Multiple Listing Service) automatically establishes an “offer of compensation” between all members for all listings if a Buyer is procured.

DudleyGarrett, your experiences may be more of a personality observation than that of the agent’s status. There is no reason why a Buyer’s Agent or Seller’s Sub-Agent would be pushing for a purchase any differently, although you can assume that a successful transaction with its attendant commission would be preferable to no transacation at all.

So why would anyone sign a Buyer’s Agency Agreement prior to looking at properties? There are several good reasons. Let’s say you want some property in a particular geographic area, but can’t be around to look at anything that comes up. A Buyer’s Agent can be your eyes and ears. A BA can also approach potential Sellers who do not currently have their property on the market and, on your behalf, propose a showing. He can also approach FSBOs (For Sale By Owners) on your behalf. He can do this because you pay the commission if it is not otherwise offered thru MLS or contractural agreements with Sellers.

So the number of properties you will be made aware of can be much more than if you have to wait for listings only.

To sum up: a Buyer’s Agent will look out for your interests, not the Seller’s, and a BA may be able to provide more prospective properties.

10

Primarily, agents work for themselves, real estate is a commission driven business. They want to close a deal successfully so that they can get paid. In general it’s in their best interests to try to close a deal with all parties as happy as possible (because happy clients are one way that agents get new clients). However, they are not praticularly motivated to tell you (as the buyer) anything that might queer the deal, and some agents will just push for a deal, any deal in some cases.

In PA at least, you have the option of hiring a “buyer broker” who is a liscened agent who is working for you, the buyer, and your specific interests under a specific type of contracted agreement. A buyer broker arrangement is currently much more the exception then the rule, and they have special rules governing them.
All buyer brokers are real estate agents, but not all agents are brokers. This same person you hire as a buyer broker may also act as a listing agent in other situations (what you might call the “seller’s agent”) but here at least, they are not allowed to work for both parties in the same deal.

If you simply contact an office an ask for an agent to show you properites, that person is not your buyer broker… they are just an agent who is working with you to look for a deal. The job of the agents is to bring the house and the buyer together, and make sure that the deal is closed properly from a legal standpoint.

At settlement, the commissions involved are paid by the seller, out of the money they receive for their sale. Commission is usually based on a percentage of the selling price and can be divided between the listing agent (who found someone who wanted to sell their house, making the deal possible), the buying agent (who found some buyers for the deal), and if applicable, the offices for which either or both of these agents work. In the end, it’s the seller who signs the checks… so in a way, the agents do work for the seller.
In your case, the sellers agent could NOT have refused your offer, she is required to present any and all offers to her clients. Only the sellers themselves can refuse.
It is also important to remember that sometimes the sellers have a lot of memories and strong emotions tied up in the “property” at hand. None of which means a hill of beans to a potential buyer. This sometimes gives sellers an unrealistic view of the worth of their property, and can make them a real pain to deal with for their agents. Sellers remorse is typical (most people rarely deal on a regular basis with $$$ as big as they do when selling their house, and doubt in their own desisions is ) If the sellers in your deal really want out, they have that option up until settlement is finalized, however absent fruad or legal issues, they will typically have to pay penalties (which they likely don’t want to do) for withdrawing from the deal unless they can get you to agree to mutally dissolve the deal. If the current deal is what you want, then stand firm and let the seller decide either to go through with the deal as currently set, or pull out and pay the costs.

If this deal doesn’t work out in the end, you may want to onsider hiring a buyer broker (or the equivalent in your state if available) before moving forward. You seem to be looking for more of that type of representation.

Disclaimer - I am not a Realtor or a real estate agent. But my mother is an agent, and I’ve been around this business (In a small townin PA, it does vary a lot by location) my whole life.

11

However…(and I’m not disagreeing with you, just elaborating)…

Agents have to walk a fine line between what is required to be disclosed and what is required to not be mentioned. In general, if an agent has knowledge of an adverse fact that might affect the price or buyer’s decision, he must disclose it (so must the Seller.)

And though an agent is not required to have the skills of a home inspector, if he could reasonably know about a significant defect, it must be disclosed. Example: if the basement is just a few steps down an inside stairway, and it has standing water year-round, an agent cannot say “I didn’t check out the basement” and avoid disclosing the water. But if the only way he could have determined a structural defect is by donning overalls, crawling in a tight space, and using a specialized tool to calculate support thickness, he is not expected to know about or disclose such.

However, some information falls in the “protected classes” where it must not be disclosed, even if requested or if the buyer feels like it would be an adverse fact. Example: Buyer wants to know if blacks live nearby. Race is a protected class and I cannot answer that. Even if Buyer wants to know what churches are close, I will hand him a map and a phone book, as religion is another protected class. “Any gay bars around?” Not gonna get an answer from me. (Other protected classes are sex, sexual preference, age, marital status, disability, lawful occupation, family origin, and economic status.)

AFAIK, visits by a motorcycle gang are not a protected class, but it might be argued that it is not an adverse defect, either. A gray area, to be sure. :slight_smile:

12

Is that such an amazingly good deal in today’s market? Sales have went down, prices not so much.

13

For the record, the first time I went through this, like I said, I had a Buyer’s Agent. I signed an agreement with the real estate agent that she was representing me.

I just thought it was funny that it seems like the Buyer’s Agent was working for the seller, and it appears that the Seller’s Agent was working for me, the buyer.

14

The house was appraised last year at $485K. I think it’s a good deal. Not great, but good.

15

I’m looking at houses, and I lovelovelove my buyer’s agent. He’s great–his goal is for me to get the house I want at a price I can afford, and he’s determined that it will be suitable for me and the kids and the whole situation (helping me overcome the “oh but it’s so cute!” tendency I have). I had no idea how to go through this process, especially given my tricky financial history (bankruptcy, etc), but he’s leading me through it step by step, and we’re making progress. I’ve worked with him before, and also with another buyer’s agent when my ex and I were househunting, and I’ve had good experiences all around.
I’ve run into seller’s agents before at open houses, and usually, once they find out I don’t have a letter of commitment from the bank in my hot little hand, the conversation usually ends, although I am of course always welcome to contact them once I have my loan.
Much depends, I’m sure, on the particular agent and his or her personality. I feel a little guilty, because I know my agent is putting in considerable time on me, and his commission is just not going to be that high because I have a really low price range. I wonder how it can be worthwhile.

16

I recently started househunting, and started out by looking online to see what was available and get an idea of price ranges. Early this week I called the number shown in one listing to see about scheduling a viewing; as it turned out the place had just been placed under contract, and the agent and I started talking about what I was looking for. I ended up giving him my e=mail address, and later that day the office sent me a list of six places that they thought I might like. I checked the listing information, and this afternoon I called to schedule a viewing. After setting up an appointment for tomorrow, we chatted a while about the joys of finding a house these days, and he brought up the fact that he was a buyer’s agent. So when we meet tomorrow, he’s going to bring me a contract to look over.

I also brought up the subject of inspections and mortgages, and he’s going to bring along a list of each of those for me to check out. I like him already, and we haven’t even met. The need for a letter of commitment from a bank is a new one to me, so I guess that’s something else I’m going to have to look into.

17

IMO you simply had a bad agent. I have had two bad agents and one good one. The good one would take me to a place, and if it was clearly a bad choice afterwards would tell me that it was my choice, but that he felt I would be happier to keep looking. He seemed to have my interests at heart.