Realtor vs. No Realtor (WA) (recommendation, plumber, 2015, appraisals)

[GotHereQuickAsICould]

Originally Posted by AreWeThereYet??

We are looking to buy a home. Our Max purchase price is right on the verge of the price point for the type of house we are looking for. I feel it could be an advantage to put in an offer without a Realtor and ask for 2-3% below and acceptable offer price. Has anyone tried this? Or would it be worth it to just use a Realtor to get the insight and best possessible price which may still be lower than what I can get on my own. Thanks

The seller has agreed to pay their agent 6%. Selling agents typically split this commission with the buying agent. Whether the selling agent will offer you the same deal remains to be seen. The seller still pays the same commission.

Over all the years we've bought and sold homes, we've only had two selling agents who were worth their commission. We never had a buying agents worth more than about $500.

Typically, the buying agent will trot us about to half a dozen or so homes and then announce, "So which one will it be?" Kind of like the house hunter shows on HGTV.

Often, agents will only show us certain houses, claiming that it was impossible to arrange showings of other homes we were interested in. Often the ones we are shown are their own listings or listings within their agency.

Every home we've bought has been after we found it by driving around or looking through listings and asking the agent to arrange a showing. Every single one.

They often discourage us from making the initial offer we want. "The sellers will be offended," and so forth. We will insist that's where we want to start the negotiation. They will drag their feet, claiming they can't get in touch with the listing agent or are waiting to hear back. Twice, we've contacted the sellers ourselves and found out days have gone by and they hadn't even heard of our offer. When we confront the agent about it, they always blame the listing agent.

Even once the deal is underway, many do a sloppy job. They've recommended inspectors who've missed things like disconnected furnace ducts under the house, etc.

In many states, you now have to sign an exclusive agreement with a buying agent. Agents defend this practice as a way to ensure that you get the focused attention of the agent as they will only agree to take on only so many clients.

This is questionable at best. If I show up with a my pre-approval from the bank in hand and two weeks to find a $400K home, want bet I'll be turned away?

What it does do is protect agents from spending a bunch of time showing you around only to have you buy a property through some other agent.

To my way of thinking, if Agent 1 had done his/her job well, there would be no need for Agent 2.

Many real estate agents are not competent at their jobs. Just as many shoe salesmen, car salesmen, etc. are marginal. Some do it part-time as sort of a social outlet. One buying agent we worked with was forever going to Lions Club, Rotary Club, Kiwanas.... meetings and fundraisers. Apparently, this was to ensure a steady pipeline of listings. But making appts. was a time consuming affair as he only had certain openings in his schedule.

Personally, I would not worry about the 3%. I would worry about finding the home you love and then negotiate the price.

I would not sign an exclusive listing until, or unless, I found a competent, hard working agent. They are out there. We've worked with two.

[dblackga]

Originally Posted by StealthRabbit

There is absolutely no need to go through a realtor. The title company does all the important paperwork. You need a very simple Purchase and Sell agreement that adequately protects the interests of buyer and seller. State realtor forms are many many pages of fluff, but helps to protect the agents and brokerages (who are only advertising agents... they have NO legal value). You can get a very good RE attorney for $300- $500 / hr. That is about 1/10th what you are paying your seller's realtor.

You need to find your own places to buy. If a realtor has it listed, it is too late to get a fair price (Commission and marketing cost has already been added). Thus... you pay dearly for real estate service that your seller is spending on. 'Gifting' realtors about $1,000 to $5,000 per hour in my case. (I do all the negotiation, due diligence, title and legal reviews + zoning, permit review, setbacks / tax district and assessment validation, financing, and payback calculations...) I insist that realtors never attend my closings, they drool all over the paperwork salivating for their commission. It is usually pretty embarrassing the foolish questions they ask and petty congratulatory comments. Absolutely ZERO value add (except to 'advertise' for seller and to provide a 'locating service' to the buyer). Very SPENDY service (?).. realtors will always whine and say "Do you know how many clients I haul around and spend DAYS assisting? and buying lunches, gas, supplies, shoes, Cadillacs... pathetic... my $35 grease car w/o AC works fine for finding properties, as it has for nearly 40 yrs. I would never think of asking a realtor to buy me lunch or dinner. (But I give my 'broker friends lots of gift certificates to use on their clients who desire hand holding and warm fuzzies)

I have bought and closed over 30 properties, many are very complicated commercial props with complex lease terms, UCC's, environmental and zoning concerns. (I have used realtors for 3 of the 30 (at the insistence of the other party))

This week I am in another state and I have bought 3 rural properties, It is the first time I have ever had 2 realtors involved. (in one of the 3 purchases). That one is by far the simplest (retirees selling a small acreage and moving to a senior MHP). I am paying cash and have offered to take care of septic / well / pest inspections, repairs, and the closing... The seller's agent has taken great offense that I would do such things and has nearly lost the sale for her clients. It is painfully slow and ridiculous going through 4 parties to make the simplest of decisions. My other 2 props this week will close and be financed, parties moved, thoroughly cleaned, and rented out long before the listing agent (sellers) gets off her high horse (pride) and comes down to reality. I bought one rural property in TX last week while I was in Hong Kong, sight unseen. I drafted and sent a P&S agreement to title company and asked seller to swing by and sign. Less than 20 minutes of seller's time was spent on the entire transaction. Done deal, while the other listing agent is prancing around telling her clients how powerful she is. She under-priced the property by about 20% of the sales price and will cost the sellers an additional 7% and 3 extra weeks. These poor senior citizens just got taken to the cleaners by their 'trusted' agent.

YMMV (I hope so)

As you have said, you have a great deal of experience in real estate transactions. MOST people do not, or they buy so infrequently that the rules and norms change drastically between purchases. If you are able to do without the services of a real estate agent, well, then, it's a service that you do not require and no one is going to to force it on you.

However, real estate agents DO provide a worthwhile service, especially to those who are uninformed in the ways of real estate. You obviously have a low opinion of real estate agents, for whatever reason. Yes, there are some real estate agents that are better than others (although, to be fair, I have never known one to drool at the closing table.) I will point out that closings are different from state to state, so telling the OP to "just use the title company" may be a disservice if they live in a state where transactions are typically handled by attorneys (such as Georgia.)

You say "You need a very simple Purchase and Sell agreement that adequately protects the interests of buyer and seller." But what if a buyer or a seller doesn't KNOW what their rights are? You obviously do -- but again, you are very experienced.

[Silverfall]

Originally Posted by MikePRU

I do try not to sit too close to the table so as to prevent my drool from getting on any of the paperwork.

That's a good tip. Sit in the corner so the drool falls on the carpet, not the table.

[GotHereQuickAsICould]

Originally Posted by dblackga

You say "You need a very simple Purchase and Sell agreement that adequately protects the interests of buyer and seller." But what if a buyer or a seller doesn't KNOW what their rights are? You obviously do -- but again, you are very experienced.

I imagine there were some lessons learned on the way to gaining that experience.

Which is what the OP is gaining. He will benefit from our advice and from lessons learned on his own.

IMO, everyone who thinks they will be buying more than one house in a lifetime should make the effort to gain some knowledge about this. We trusted real estate agents and it has cost us thousands.

My husband once let a real estate agent talk him into overpricing a home. "See what it does on the market" was his advice. What the market did was ignore it. Later, my husband accepted a low offer as he was out of the country by then. Guess who bought the home? The real estate agent.


Rather than realtor or no realtor, I would suggest looking for a good realtor who would help find the right property and negotiate a good price for it.

Trying to do it alone means that you will often be asking the listing agent to show you the home. Then you will be a in a dual agency situation if you decide to buy.

I would definitely look at FSBO without an agent.

And find a good real estate attorney.

[EngGirl]

It's very hard to say if buyer's agent could get better price because nobody ever bought the same house with and without the agent at the same time to compare outcome price...
Agents are not always on their buyers side. Check out other topics on this forum.
Going by yourself doesn't make much sense financially if there is seller's agent. You can either go with listing agent, and there is a high chance he/she will lower his/her $$ to work this deal out or you can find an agent who will rebate you up to 2% at closing. And yes, I don't see any benefits from having a buyers agent. I would never use anyone who buyers agent will recommend (inspector, mortgage broker, insurance) because they all depends on this deal to be done.

[DontKnowIfImComingOrGoing]

Originally Posted by StealthRabbit

I insist that realtors never attend my closings, they drool all over the paperwork salivating for their commission. It is usually pretty embarrassing the foolish questions they ask and petty congratulatory comments. Absolutely ZERO value add (except to 'advertise' for seller and to provide a 'locating service' to the buyer).

Yep. I found the same thing when I did turn up to a closing. The realtor was hopeless, the attorneys were what drove entire process and the home was closed DESPITE the realtors. I asked the attorneys if this was typical and they confirmed it was and all this stuff about "good" realtors was nonexistent. Realtors are sales people, if you need a salesperson for a house then get one, but don't get one for any other reason.

So I don't use realtors anymore, they really do add no value if your in the area. I did however, use a realtor when I sold a home in a state which I no longer lived in.

[hotzcatz]

Originally Posted by AreWeThereYet??

We are looking to buy a home. Our Max purchase price is right on the verge of the price point for the type of house we are looking for. I feel it could be an advantage to put in an offer without a Realtor and ask for 2-3% below an acceptable offer price. Has anyone tried this? Or would it be worth it to just use a Realtor to get the insight and best possible price which may still be lower than what I can get on my own. Thanks

Buying a house is usually a unique experience each time although there are a lot of similarities between the various transactions. As has been mentioned, once a house has been listed with a Realtor, then the Realtor's commission is already locked in place. You might be able to get the seller's Realtor to give you the half of the commission which would normally go to the buyer's Realtor, but then and again, maybe not. Actually, more than likely not. Giving the 3% to you does nothing for the Realtor other than maybe make one sale and they can probably do that anyway. Giving it to another Realtor helps them with the next time they work with that other Realtor. In either case, it's taking money out of their pocket.

In our state, they allow "dual agency" sales where the listing Realtor and the buying Realtor can be the same agency. We've usually found that using just one Realtor for the transaction works in our favor since that Realtor really wants us to buy the property since they then get the full 6% and don't have to split it. Trying to get the Realtor to hand over half their commission isn't going to get them interested in their client selling the property to you. Now, letting their Realtor know that you'd buy the property for 5% less and not bring in another Realtor on your side of the transaction would probably be a more productive approach. Then you'd have the Realtor trying to get their client to sell you the property at a reduced rate since the Realtor would then get the full 6% commission because there is no other Realtor to split it with. You still get a reduced price, they get a full commission and the people selling get their house sold although if anything, it's the sellers who are funding the reduced amount.

[Silverfall]

Originally Posted by AreWeThereYet??

We are looking to buy a home. Our Max purchase price is right on the verge of the price point for the type of house we are looking for. I feel it could be an advantage to put in an offer without a Realtor and ask for 2-3% below and acceptable offer price. Has anyone tried this? Or would it be worth it to just use a Realtor to get the insight and best possessible price which may still be lower than what I can get on my own. Thanks

You know in the end it is all about the net for the seller. You need to write an offer that nets the seller a dollar amount they are willing to take. Is your market getting a lot of multiple offers?

[StealthRabbit]

Originally Posted by jghorton

If the seller has contracted with a Realtor to sell the house, ... It is pointless ... (and not too smart) for a buyer to attempt to buy the house without their own representative (Realtor) --- unless the seller's Realtor, (NOT the seller), has first agreed to accept a lower commission. --- The selling Realtor will not spend any less time, effort or expense (in fact, they will probably have to do more), if the buyer chooses to purchase without their own Realtor.

I have to buy places all the time that are listed, BUT... I just have a Real Estate attorney call the listing agent and inform them of required protocol, and to stay out of my space. Costs about $200. (worthwhile expense).

In reality I have very little experience in Real Estate, tho been buying and selling since age 19. One has to do something to build wealth. Wage income does not hack it (and even less so in future). 25 of my 30+ transactions have been in WA State, first drooling RE person @ closing... I moved on from that very uncomfortable experience, but I have had the tears and rage of 4 listing agents in the last 2 yrs in Texas when I told them to 'step outside', so closing title officer and I could get our work done and get on with it... The 3rd to last place I bought (2.5 weeks ago) was done sight unseen from Asia and no realtors on either side. It worked out terrific. We (buyer and seller) remain great friends (I helped them move 2000 miles) and we were closed in a week. Would be fun to see the stats on realtor managed transactions that close in less that 10 days. I do it on about 40% of my places. One of my other 'non-property-educated coworkers' buys 10 - 20 houses / month in 6 PNW counties. Neither of us consider this our J-O-B... we have very demanding careers (60 - 80 hours / week and extensive international travel). RE is EZ. (for many, not all)

I bring lots of tissues to closing so the title officer can distribute to the weeping and slobbering RE Agents and brokers who I banish to the reception area. I show up for closing after the seller has signed and is long gone. (I'm sure out enjoying his steak dinner provided by RE agent.) I had to do a distant sell of commercial properties and used a broker to find a buyer. After closing, he sent me a weekend package on the Oregon coast, and I sent him the equivalent to his choice of destinations. It was under $1000, and done in good faith by each.

Have fun! be wise, carry a handkerchief.

[shaylahc]

As long as you know what you're doing, I don't see anything wrong with it. The paperwork can be complex, so I'd possibly retain a lawyer to look over the paperwork before you sign.

I bought a home without a realtor once. This was back when iNest existed. They would split the commission 50/50 with you. They were your realtor on paper only, and once they got their check, they would send you half. They sent me a check for $3000, which paid for a nice fence.

I agree that realtors are woefully overpaid for what they do. Now that we live in the age of the internet, and you can see MLS listings and find houses on your own, all you really need is help with the paperwork. I've been burned before with realtors using their "favored" banks, lawyers, and title companies. Sometimes they work in the realtor's best interest and not yours. I have also been deceived by realtors. I had one realtor try and push a sale through because she wanted her commission, even though buying the house would have been a financial and health disaster (it was mold infested).

At the end of the day its all about money. If you think you can handle the paperwork, by all means make the offer yourself. Just be sure to add contingencies (like an inspection clause) to CYA.