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Often times buyers and sellers are operating on high emotions. It is part of the job of the listing agent and buyer's agent to pull them back to earth and deal with realities.
Just because a buyer loves, loves, loves your listing, doesn't mean it is appropriate at all for them. In my recent search there were many homes I loved. I've always been drawn toward large center hall colonials on multiple acres. The more architectural details in the home, the better. This often means older properties.
However, while these types of properties hit my hot button VERY quickly, they are not in my best interest as I approach my golden years and definitely not what I NEED. Yes the house was drop dead gorgeous, loaded with architectural details, designed by a leading architect of the area, 5600+ sq ft, pool, poolhouse, 14 acres, 12 of which I could put a conservation easement on..............
but I'd have to take care of it all..........and two story...with my knees.........heating and cooling costs, the likelihood of having to give up the well and septic system and go with city water and sewer.........none of this IS in my best interest or meets the stated NEEDS I gave my buyer's agent.
What did I tell my BA? Updated sprawling ranch with pool, UPDATED with today's modcons, no more than 1 acre. In lieu of ranch, first floor living with MB and at least one additional br on the first floor, office, today's modcons, no more than 1 acre and if no pool, proper space and sun exposure for one.
My BA is fortunate, in that as a former realtor, I'm able to talk sense to myself and recenter my search efforts properly towards my stated goal and not waste anybody's time.
I sure loved that horse farm with beautiful updated sprawling ranch home on 14 acres.........and it was fairly inexpensive compared to other properties, but it was miles and miles away from anything. Hardly appropriate!!! But I loved it just the same.
First, it is interesting that the majority of RAs would only forward the contract, not the email. If the email provides additional information (a form of an addendum) to the seller about the offer or me (the buyer) why would the seller agent want to withhold this from the seller? Perhaps to keep the issue of the BA commission off the radar? I doubt the agents are withholding this to protect their sellers! If so, please explain how withholding communications can help your seller.
I fully admit that I am trying to use the BA commission (or lack of one) to my advantage, what buyer, or seller doesn't try to maximize their advantage? However, I wish RAs in the thread would admit that the reason they would not forward this info to their buyers, or discuss this scenario at the time the listing agreement is signed, is for the agents own potential financial gain.
Also interesting that most RAs discourage direct buyer-seller communication. I understand the benefits of the RA buffer. However, there are times when direct contact b/t seller and buyer can help. We recently sold our home (yes I hired an agent) and the communications seemed to be very poor b/t my agent and the BA. It became clear that the buyers were not receiving the correct info. Not surprising when communication chains pass through multiple parties. Anyway, I demanded a face to face meeting with buyer and our agents. It became immediately evident that the agents were not communicating well. Some vital, time sensitive info had been withheld from the buyers. It was quite uncomfortable and embarrassing for the agents to have to face these mistakes with the us (buyer and seller) and I can see why agents would discourage this forum. In the end, after talking with the buyers we directly hammered out a deal in 15 minutes much to the dismay of the speechless agents in the room.
Finally, I completely discount the notion that informing the seller that we are unrepresented is somehow interfering with the listing agreement. Sure, the seller agent would rather this issue not be raised, but it is far from interference. I think it could better be described as transparency or educating the seller. I did not suggest that the seller re-negotiate the contract, I just informed him of my status.
The comments from the RAs in this group only further my opinion that many agents have self serving motives, conscious or unconscious. It would be interesting to hear the opinions of buyers and sellers on this issue. My guess is it would be radically different than the RA crowd.
I think at least most of the agents on here have said that they would disclose that there is no buyers agent. I would disclose it verbally as well as present them with a contract with the information in writing. I believe the ethical thing to do is disclose it to the seller, but I would not ever forward a personal email from a buyer to a seller. My job is to represent either a buyer or seller and look out for their best interest. I may not be able to do so if they are communication directly with each other. Most people that hire an agent prefer the protection from having to deal with the other party.
I'll ask you this. How do you know that the buyers agent commission is 3%? It may not be. The fact the you want to negotiate what is in the listing agreement is an interference with a contract between the listing agent and the seller. I understand that you are wanting to do this to in order to get the best deal on the house, but it isn't my job to get this for you or to share the information that is in that contract. I represent the seller and it is my job is to sell their house for the best price I can get. I won't negotiate my commission with you. Why would I? There will be discussion about it but it will be between me and my client.
As you can see, if it were my listing it could help you to do what your doing, as long as you don't mind not having representation, but as far as you being part of the discussion about what my commission will be, that isn't going to happen.
I have been both a buyer and a seller. I honestly don't want to have direct contact with the other side. No point in my mind. Emotions just get in the way.
First, it is interesting that the majority of RAs would only forward the contract, not the email. If the email provides additional information (a form of an addendum) to the seller about the offer or me (the buyer) why would the seller agent want to withhold this from the seller? Perhaps to keep the issue of the BA commission off the radar? I doubt the agents are withholding this to protect their sellers! If so, please explain how withholding communications can help your seller.
I think most of the agents here have said that they would tell the sellers that you don't have a BA. What many have said is that they would not necessarily do this by forwarding your exact email. Given the way this thread is going, withholding your email would probably be doing you a favor because I think your tone is likely to really rub a seller the wrong way.
Quote:
Originally Posted by RE Skeptic
I fully admit that I am trying to use the BA commission (or lack of one) to my advantage, what buyer, or seller doesn't try to maximize their advantage? However, I wish RAs in the thread would admit that the reason they would not forward this info to their buyers, or discuss this scenario at the time the listing agreement is signed, is for the agents own potential financial gain.
What you seem to refuse to accept is that your lack of BA may not even reduce the commission anyway. It depends on the agreement that the seller signed with the listing agent, a contract that you are not party to and have no right to try and alter.
Quote:
Originally Posted by RE Skeptic
Also interesting that most RAs discourage direct buyer-seller communication. I understand the benefits of the RA buffer. However, there are times when direct contact b/t seller and buyer can help. We recently sold our home (yes I hired an agent) and the communications seemed to be very poor b/t my agent and the BA. It became clear that the buyers were not receiving the correct info. Not surprising when communication chains pass through multiple parties. Anyway, I demanded a face to face meeting with buyer and our agents. It became immediately evident that the agents were not communicating well. Some vital, time sensitive info had been withheld from the buyers. It was quite uncomfortable and embarrassing for the agents to have to face these mistakes with the us (buyer and seller) and I can see why agents would discourage this forum. In the end, after talking with the buyers we directly hammered out a deal in 15 minutes much to the dismay of the speechless agents in the room.
Sounds like you were working with some disorganized or just bad agents.
Quote:
Originally Posted by RE Skeptic
Finally, I completely discount the notion that informing the seller that we are unrepresented is somehow interfering with the listing agreement. Sure, the seller agent would rather this issue not be raised, but it is far from interference. I think it could better be described as transparency or educating the seller. I did not suggest that the seller re-negotiate the contract, I just informed him of my status.
As I said, I think just about any agent will inform the seller of your status. I just don't think it's the golden ticket you seem to think it is. It may mean that the seller can pay a lower commission; however, IMO, it is unlikely to change the price the seller will accept significantly. Sure, if they pay 2% less they can take 2% less and walk away with the same amount at the closing table, but the seller is still going to try and get as much as they can for the house, and that is what the listing agent is going to try to do for them.
Quote:
Originally Posted by RE Skeptic
The comments from the RAs in this group only further my opinion that many agents have self serving motives, conscious or unconscious. It would be interesting to hear the opinions of buyers and sellers on this issue. My guess is it would be radically different than the RA crowd.
I happen to be selling my house right now. I would love it if someone came to me directly instead of with an agent, because then I could net more on the sale. That buyer's lack of an agent doesn't change the comparable sales in the area and doesn't change the market value of the house. IMO, an un-represented buyer is a double edge sword. On one hand, I will net more at the sale. On the other, the transaction will probably be a much bigger hassle, will be much more stressful for me, and is less likely to close.
First, it is interesting that the majority of RAs would only forward the contract, not the email. If the email provides additional information (a form of an addendum) to the seller about the offer or me (the buyer) why would the seller agent want to withhold this from the seller? Perhaps to keep the issue of the BA commission off the radar? I doubt the agents are withholding this to protect their sellers! If so, please explain how withholding communications can help your seller.
I fully admit that I am trying to use the BA commission (or lack of one) to my advantage, what buyer, or seller doesn't try to maximize their advantage? However, I wish RAs in the thread would admit that the reason they would not forward this info to their buyers, or discuss this scenario at the time the listing agreement is signed, is for the agents own potential financial gain.
Also interesting that most RAs discourage direct buyer-seller communication. I understand the benefits of the RA buffer. However, there are times when direct contact b/t seller and buyer can help. We recently sold our home (yes I hired an agent) and the communications seemed to be very poor b/t my agent and the BA. It became clear that the buyers were not receiving the correct info. Not surprising when communication chains pass through multiple parties. Anyway, I demanded a face to face meeting with buyer and our agents. It became immediately evident that the agents were not communicating well. Some vital, time sensitive info had been withheld from the buyers. It was quite uncomfortable and embarrassing for the agents to have to face these mistakes with the us (buyer and seller) and I can see why agents would discourage this forum. In the end, after talking with the buyers we directly hammered out a deal in 15 minutes much to the dismay of the speechless agents in the room.
Finally, I completely discount the notion that informing the seller that we are unrepresented is somehow interfering with the listing agreement. Sure, the seller agent would rather this issue not be raised, but it is far from interference. I think it could better be described as transparency or educating the seller. I did not suggest that the seller re-negotiate the contract, I just informed him of my status.
The comments from the RAs in this group only further my opinion that many agents have self serving motives, conscious or unconscious. It would be interesting to hear the opinions of buyers and sellers on this issue. My guess is it would be radically different than the RA crowd.
Direct buyer seller contact depends on the buyer and seller. I have a seller and buyer get together about once a year. Most sellers have no desire to deal with a buyer and visa versa. People that are okay dealing with buyers/sellers directly go into the FSBO market.
I think it is funny that you think an agent wouldn't forward your email on because they want to protect their commissions. Your communication style is brusque and if the tone of your email was like the tone of your posts, the agent might be doing you a big favor to present your "side" without the email. The fact that you can't see that there might be other reasons for not doing it the way you want may not bode well in negotiations. Most people avoid conflict like the plague. Your direct style of communication has a more "in your face" aspect that would turn many clients off. Many people need a softer approach, which is why they hire an agent as a buffer.
I was in a similar situation in that I found a house on my own and I was also trying to not use an agent and pass on some of the savings to myself. I think your plan is probably unlikely to work because it will require the seller to make a stand with his agent. The agent will surely try and pocket the entire 6% and the seller is going to have to make a stand against the agent and most people are not that aggressive.
You could contact the listing agent and ask them to represent you and pass on a significant portion of the commission back to you. If this is a 800K house really the best that they could hope for is a quick sale and a 24K commission. Give them 1/3 of the commission and now they have a quick sale and a 32K commission. That seems like a smart move to me.
The other thing I would do is find a realtor and pay them by the hour and have them rebate you the rest. If the buyer's agent gets a 24K commission, you might be able to find someone to work 10 hours for $2000 and rebate the rest back to you.
I can tell you that what I did was go on trulia and post that I was looking for an agent and a significant rebate and that I already had found the house. I got plenty of offers and settled on one that was half the commission back. If I had to do it again I would have paid hourly. And y place was 300K. At 800K no question that hourly is the way to go.
This house will have a big commission and will be a huge windfall for any agent that gets the whole thing. Is it really any more difficult to agent a big house vs. a small one? Normally agents are happy to work for 3% on 200K or $6000. So it would seem that $6000 should definitely attract some agents especially considering you already have the house picked out. No need for them to take you out touring 25 different houses.
I was in a similar situation in that I found a house on my own and I was also trying to not use an agent and pass on some of the savings to myself. I think your plan is probably unlikely to work because it will require the seller to make a stand with his agent. The agent will surely try and pocket the entire 6% and the seller is going to have to make a stand against the agent and most people are not that aggressive.
It isn't simply that the sellers need to "take a stand." The sellers have signed a contract with the listing brokerage. They cannot simply change their mind about paying the commission. If sellers could do that then no real estate agent ever would ever get paid. Also, the contract is with the brokerage the list agent works for, not with the specific agent. So, even if the agent were willing to take a smaller commission, their managing broker may not allow that (and why should they when they have a signed contract?).
If contracts can be voided and changed with the snap of ones fingers they are not worth the paper they are written on.
If the contract states that the commission payable will be reduced in the event that a buyer is un-represented, then the commission will be reduced. That is an agreement between the seller and the listing brokerage. Period. Even if the commission payable is lower, it does not mean the seller will accept a lower price. They may accept a lower price and they may not, but that is not because of real estate agent greed anymore than it is because of the seller's greed.
I think the OP has raised some very legitimate points, and I have no problem with his or her tone at all.
I also don't understand why some people aren't "getting" a main point about negotiation. Let's assume that the seller and the SA have a contract calling for the SA to pocket 6% (with the usual split for his broker, etc.) upon the home sale. But if I am the SA and a good offer has just come in, I may be more than happy to reduce my commission from the 6% (particularly on an $800K house) while increasing it from my usual 3%, say, to 4%, in exchange for doing slightly more work for this deal. SAs sometimes drop their commissions even on represented sales, if they want to get the property sold, the sellers won't budge on price, the SAs don't think a better offer is coming along, etc. Likewise, there is nothing preventing the seller and agent from having a conversation in this situation. A contract is not carved in stone if both sides agree to change its terms. The OP isn't dictating to the sellers what they should do or trying to nose in on the contract. S/he's just giving an option to get the sale done in a way that benefits everyone.
Let's be honest-- the vast majority of BA time is spent showing buyers houses and the proportion of BA work that remains once is deal is made is very small relative to that time, and sometimes buyers never do buy properties (so other sales commissions have to make up for this cost for the BA to remain in business). So the OP as a buyer (assuming s/he's very qualified) is reducing both time and risk relative to a normal BA relationship.
Why should the managing broker allow that? Because the broker doesn't have to give a buyer agent 3% and has a (presumably) able and willing buyer sitting right there. Lower costs for the broker for the SA to do a tiny bit of extra work? Rational brokers would say "sounds good to me."
I think some of the posters on this thread are trying too hard to find angles to protect their commissions in this situation.
I was in a similar situation in that I found a house on my own and I was also trying to not use an agent and pass on some of the savings to myself. I think your plan is probably unlikely to work because it will require the seller to make a stand with his agent. The agent will surely try and pocket the entire 6% and the seller is going to have to make a stand against the agent and most people are not that aggressive.
You could contact the listing agent and ask them to represent you and pass on a significant portion of the commission back to you. If this is a 800K house really the best that they could hope for is a quick sale and a 24K commission. Give them 1/3 of the commission and now they have a quick sale and a 32K commission. That seems like a smart move to me.
The other thing I would do is find a realtor and pay them by the hour and have them rebate you the rest. If the buyer's agent gets a 24K commission, you might be able to find someone to work 10 hours for $2000 and rebate the rest back to you.
I can tell you that what I did was go on trulia and post that I was looking for an agent and a significant rebate and that I already had found the house. I got plenty of offers and settled on one that was half the commission back. If I had to do it again I would have paid hourly. And y place was 300K. At 800K no question that hourly is the way to go.
This house will have a big commission and will be a huge windfall for any agent that gets the whole thing. Is it really any more difficult to agent a big house vs. a small one? Normally agents are happy to work for 3% on 200K or $6000. So it would seem that $6000 should definitely attract some agents especially considering you already have the house picked out. No need for them to take you out touring 25 different houses.
You are assuming as well that there is a 6% commission in the contract.
I'm surprised the issue of what happens if the buyer's don't have an agent isn't addressed when the listing contract is signed. I know when I sold my house we specifically talked about it and it was addressed in my listing agreement.
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