Conflict of interest - and realtor's commission (Houston, Dallas: appointed, sales)

[tfowlerhouston]

Let's say I am buying a house. If I don't bring in a buyer's realtor then I believe the listing realtor makes 6%. But who will help me in assisting with inspection, negotiation, closing etc.

So if I have scanned all the homes in and around an area and have narrowed the list down to a couple and they are both listed by the same agent, can I simply call the listing agent and ask them to represent me. They have to resolve the obvious conflict of interest. But my question is wouldn't the listing realtor stand to gain more monetarily if I did that.

If I get pre-approved and have a good idea of what a fair price for the house should be would the above be a good strategy because the listing agent is more motivated to sell the house to me due to the bigger % of commission they can keep.

- tf

[Poltracker]

Keep in mind that their commission will be larger if they get a higher price for the house which is their job as the seller's agent. I recommend you get your own agent and/or use a RE attorney to assist you.

[crone]

Whatever you do, get your own agent. There are some great ones on this forum.
We had bought and sold 24 houses due to corporate transfers. I thought I knew what I was doing.

When we came back to Houston I contacted the person who had represented us on several of those transactions. We had a hard time finding a house. We finally found one, it was her listing. We agreed on price, had the inspections, and were set to close. I went to Dallas to move. My Dallas house was due to close in 3 days and I had to be out. The packers were packing and loading the next day. The agent called and told me the sellers could not vacate the house and I would need to put my stuff in storage. Confused and angry because the sellers had already been living in their new town for a month, I told her, if I was gonna have to do that, I'd find another house.

We put our stuff in storage and started living in temporary housing. Low and behold she got another listing just down the street. We bought it knowing we paid a little too much. But we needed our stuff out of storage.

Ten years later, I contacted a very talented and smart agent whose post I had respected here on CD to sell that house. That is when we learned all kinds of tricks had been played on us by someone I considered a friend. The comps I had been given were not real. The square footage was not real. Nothing that we used to base our bid on was real. We overpaid by at least 50 thousand dollars.

I also learned from the neighbor and best friend of the owner of house number 1 that when the agent called me and told me the sellers could not vacate, the house was vacant. By the time I found Cheryjohns 10 years later, it was too late to do anything legal or with TREC. The only option open was for the sellers of the house to sue her. They were not in a position to do it. Their house remained on the market another 6 months, creating a real financial hardship on them. And they believed I caused it.

[chris_ut]

If you already know the house you want and know what you should be paying for it then contact the sellers agent to show you the house, tell them you represent yourself and ask for 3% toward closing then use an attorney to do your paperwork which will cost you about .5%. If you don't know the area or need to look at a bunch of houses you are best of getting a buyer's agent.

[HoustonBornNRaised]

Get your own representation. The listing agent represents the seller. Chances are, you'll end up being pawned off to another agent appointed by the listing agent's broker anyway.

Search here:

REBAC: Find a REALTOR® Committed to Buyer Representation

[tfowlerhouston]

@Poltracker: The point I was trying to make is the following:
House price: $250,000
Listing agent: 6% = $15,000
If I can negotiate the price down to $240,000 and ask the listing agent to find representation for me but I do the negotiations anyway, the listing agent might keep: 4.5% = $10,800

If I were to bring in a buyer's agent and the price goes down to $240,000 the listing agent keeps only 3%: $7,200

So my question was from the point-of-view of the listing agent. Of course, my assumptions above could be wrong. And worse things can happen as @crone mentioned.

@crone: Wow, sorry to hear that story. The thing that stood out was "The comps I had been given were not real".

@chris_ut: Precisely. Can I really ask for 3% but I am not a realtor.

@HoustonBornNRaised: Great link, thanks.

Alternately, can I interview a realtor and tell them that mine is a special case (I know what house to buy, etc.) so please represent me to smoothen the process. But would they share their commission with me. It seems unfair to ask someone to share their earnings.

- tf

[cheryjohns]

Originally Posted by tfowlerhouston

@Poltracker: The point I was trying to make is the following:
House price: $250,000
Listing agent: 6% = $15,000
If I can negotiate the price down to $240,000 and ask the listing agent to find representation for me but I do the negotiations anyway, the listing agent might keep: 4.5% = $10,800

If I were to bring in a buyer's agent and the price goes down to $240,000 the listing agent keeps only 3%: $7,200

So my question was from the point-of-view of the listing agent. Of course, my assumptions above could be wrong. And worse things can happen as @crone mentioned.

@crone: Wow, sorry to hear that story. The thing that stood out was "The comps I had been given were not real".

@chris_ut: Precisely. Can I really ask for 3% but I am not a realtor.

@HoustonBornNRaised: Great link, thanks.

Alternately, can I interview a realtor and tell them that mine is a special case (I know what house to buy, etc.) so please represent me to smoothen the process. But would they share their commission with me. It seems unfair to ask someone to share their earnings.

- tf

What if the house was only worth $230K market value?

[Lost_In_Translation]

Originally Posted by cheryjohns

What if the house was only worth $230K market value?

I don't understand how only realtors can gain access to comps? If the information on sales is supposed to be private (not publicly shared), how can RE agents share it amongst themselves and if it can be shared within the RE community, why can't an individual request it for a fee? Maybe I'm wrong in this...?

To be fair, I think good agents can provide alot of assistance in the buying process, with their experience and knowledge, but there are alot of roadblocks I think are purposely put up in front of consumers to force them to utilize the RE industry solely.

[chris_ut]

You can not ask for the 3% as a commission but you can ask for 3% price drop in consideration.

[HoustonBornNRaised]

I wouldn't be willing to share my commission, because I still get taxed on the whole amount (post-closing).