Purchasing a home without a buyer's agent? (Houston: condo, broker)
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We are ready to purchase our new home in Dallas. We did the homework and narrowed our listing to 5 houses and got the MLS report from agents we contacted earlier. So now we are debating if it is nessesary to hire a buyer's agent. A friend who's also a realtor told us that a good buyer's agent will do research on the current market, point out downsides of a house and be a strong negotiator. However, just maybe my opinion, I doubt an agent will tell the whole truth of a house because if he does so buyer will offer lower price which makes it harder for him to negotiate. It seems to me that a buyer's agent is only making effort to close the deal. The higher price of final sale the higher commission for him.
Should I contact seller's agent directly or get myself a buyer's agent? Any suggestions would be greatly appreciated
You don't need a realtor or an agent as long as you can negotiate and have time/energy to argue & spend time with the builder and know exactly what involves in building a home. If you're buying an inventory home, it makes it even easier. All this works ONLY if you know which lot, which location, which subdivision you want to buy in.
If you want someone to take you around town and use their expertise to help you - you should have a realtor.
I have dealt with realtors who side with the builder than the buyer but the won't last long.
We just bought a house without using a buyer's agent. We are too picky about houses and the process of purchasing in general. I also believe that no agent would bargain for the house for us like we did. I mean, I can totally see us being a major pain in the rear for any agent. This is not the first house we bought without the buyer's agent.
On the other side, I can't tell you how many problems we had contacting seller's agents. As soon as they hear we don't use an agent and want to look at the house, they either don't want to show it to us or give us hard times. I had to send a couple of complaints to managing brokers and even one to the board about some realtors' conduct.
I understand the reason why many of the listing agents don't respond to buyers who are not represented. Realtors also have bad experiences and this is just the automatic reaction now.
I remember when I just started I used to jump when I get a phone call on my listing and run to show it and after getting stuck in traffic and wasting at least an hour of my time, effort and gas, I get "thank you for your time" and they walk away. Imagine having that 2-3 times a day during the week.
Some people don't realize that we have families to support and bills to pay and they think that they are the only buyers calling for the house and it is ok for them to waste our time and not ok if we tried to be productive with our time. Electric companies don't accept "thank you for your time" as a payment!
This is why now I don't show the house unless they agree to work with me as their buyer's agent, and I will gladly work hard for them, show them as many houses as they want and negotiate as they want. I had a client who was looking for a house for 18 months and I never said no or enough because loyalty was on both direction, this is how it works!!
Our job is not opening doors, there are many things that we handle on each transaction more than people can think. people don't realize how much time we spend for them communicating with their lender, title company, listing agent, inspection, appraisal so we can make the transaction as smooth as possible for them. I can easily get 30-40 emails per day to handle all of these, other than the phone calls and the text messages, that's like a full time job on its own
You don't need a realtor or an agent as long as you can negotiate and have time/energy to argue & spend time with the builder and know exactly what involves in building a home. If you're buying an inventory home, it makes it even easier. All this works ONLY if you know which lot, which location, which subdivision you want to buy in.
If you want someone to take you around town and use their expertise to help you - you should have a realtor.
I have dealt with realtors who side with the builder than the buyer but the won't last long.
Ouch! that's a bad realtor.
The first piece of paper signed between the agent and the client is that the agent will do the best of the client's interest. On the other hand, the realtor will not do anything without the buyer's approval. The realtor represents the buyers offer but will not force the buyer to pay more than what he wants
Realtors also have bad experiences and this is just the automatic reaction now.
This is why now I don't show the house unless they agree to work with me as their buyer's agent, and I will gladly work hard for them, show them as many houses as they want and negotiate as they want.
Our job is not opening door
I hope that you make this abundantly clear to all of your listing clients. There should be a giant disclaimer on page one of your listing contract that states:
"It is inconvenient for me, the realtor, to sell your house to someone who is not represented by another realtor so I will not do my job unless and until that person promises to pay me to show the house that you are paying me to show."
I understand that maybe 1 in 10 people who ask to see a house may actually buy that house, but as far as I am concerned it is your job to show that house even to the people who don't have a realtor. If that is inconvenient for you, then you need to arrange to split your listing commission with an agent that it is not inconvenient for or you need to decline listings all the way across town b/c you are apparently unable to do exactly what it is that I am paying you to do.
If you are selling my house, your job, as far as I am concerned is to aggressively follow up on every single lead. If you can't or you won't do that, then you are not doing your job for me....I would never hire a realtor that refused to show the house to an unrepresented person. I have and will continue to spell that out in the listing contract to every realtor I use.
Maybe it is different in Houston, but the commission is negotiated between the seller and listing agent, right? The listing agent then agrees to pay the buyer's agent half of that negotitated commission. Right? So, if the buyer comes without representation, the listing agent gets all of the already agreed upon commission anyway.
Why on earth would anyone make the largest purchase of their life without proper representation? I just don't understand.
Also, if I'm the listing agent, and a buyer comes to me who does not want any representation, that means THEY have to do all their own paperwork, they have to find and fill out all forms correctly, and follow up with their lender, inspector, title company... because I can't do any work for them, because that would be representing them.
Maybe it is different in Houston, but the commission is negotiated between the seller and listing agent, right? The listing agent then agrees to pay the buyer's agent half of that negotitated commission. Right? So, if the buyer comes without representation, the listing agent gets all of the already agreed upon commission anyway.
Why on earth would anyone make the largest purchase of their life without proper representation? I just don't understand.
Also, if I'm the listing agent, and a buyer comes to me who does not want any representation, that means THEY have to do all their own paperwork, they have to find and fill out all forms correctly, and follow up with their lender, inspector, title company... because I can't do any work for them, because that would be representing them.
You are correct.
A much better way of handling this is to locate a couple of agents that work near the home and hand off those prospective buyers to those agents to show the home.
We can do double representation in Texas, but like I have said on this forum before, I don't think it's ethical. No individual can fully represent both parties. Again, every case of fraud I have ever heard about involved only one agent, handling both sides. To me, it's just better to give up that 3% and tell that agent "Go do your job for the buyer". I'll do my end for the seller. If I was a seller, I would not want my listing agent to represent the buyer.
Why on earth would anyone make the largest purchase of their life without proper representation? I just don't understand.
Also, if I'm the listing agent, and a buyer comes to me who does not want any representation, that means THEY have to do all their own paperwork, they have to find and fill out all forms correctly, and follow up with their lender, inspector, title company... because I can't do any work for them, because that would be representing them.
Not everyone needs a realtor...realtors would have you believe that its impossible to buy property without a realtor, but its not. Its actually not even difficult....people who are not comfortable doing it, should use a realtor, but this attitude that non-realtors can't do it is absurd.
Who does not need a realtor for a large purchase? I dont. I invest in real estate all the time. I buy rental properties, commercial buildings, farms, ranches, vacant land, etc. I know the markets I buy inside of, and I know these markets often far more intimately than the realtors do. I am also an attorney. I do not need a realtor to fill out my paperwork. In fact, even when I have to use a realtor, I still do my own paperwork, b/c realtors are far sloppier than I am. If I contact a realtor to show me a property its because I am ready to buy it unless there is some major defect that has not been disclosed...and that does happen....I dont feel that I wasted a realtors time when that happens, I feel that a realtor failed to adequately represent the property.
Nothing a realtor does is very complicated....knowing their market is 9/10 of their job. Realtors have a purpose, they help people who need/want the help, are too busy to do it themselves, dont have the knowledge, etc - there are tons of folks who NEED realtors, but the actual process of systematically excluding non-represented buyers from the market is nothing more than lazy realtors not wanting to work without a guaranteed pay day and job protection amongst realtors...clinging to an inflated commission when the internet already did their job for them.
I hope that you make this abundantly clear to all of your listing clients. There should be a giant disclaimer on page one of your listing contract that states:
"It is inconvenient for me, the realtor, to sell your house to someone who is not represented by another realtor so I will not do my job unless and until that person promises to pay me to show the house that you are paying me to show."
I understand that maybe 1 in 10 people who ask to see a house may actually buy that house, but as far as I am concerned it is your job to show that house even to the people who don't have a realtor. If that is inconvenient for you, then you need to arrange to split your listing commission with an agent that it is not inconvenient for or you need to decline listings all the way across town b/c you are apparently unable to do exactly what it is that I am paying you to do.
If you are selling my house, your job, as far as I am concerned is to aggressively follow up on every single lead. If you can't or you won't do that, then you are not doing your job for me....I would never hire a realtor that refused to show the house to an unrepresented person. I have and will continue to spell that out in the listing contract to every realtor I use.
I didn't mean that I don't show the house at all....BUT I have to make sure first that they are serious and ask them some questions.
One time I went to show my listing, first, they were 45 minutes late, second, the lady said we are looking for a house to my daughter but she doesn't have any credit and doesn't have money for down payment or closing costs.
Another time, after getting to the house, the buyer said can i use my mother-in-law's social to buy the house, I said that you will have to use her income in that case, he said: oh she passed away 2 years ago
I will be more than glad to show the house and sell it because this is my job but the ratio is 1 of 50 of serious buyers. And the norm is to split the commission with the buyer's agent.
I understand the reason why many of the listing agents don't respond to buyers who are not represented. Realtors also have bad experiences and this is just the automatic reaction now.
I understand the "automatic" reaction. I do. That's why I usually try to show that I am serious about the purchase. I send loan approvals, tax return statements, bank statements. But when even after all of that done I get refused, then I don't understand why. And I think it's unethical towards the seller. If I were a seller and find out someone could have been a potential buyer, but was refused by my realtor just because the realtor didn't want to spend time showing the house, then I wouldn't want to work with such a realtor.
In my particular situation, the realtor didn't have to drive anywhere. The owners were still living in the house. All she had to do is to let the seller know and let us in. She refused to let the seller know. She told us she did, but later, after I contacted the seller directly, it turned out the realtor wasn't telling the truth.
Quote:
Originally Posted by HoustonPharaoh
..unless they agree to work with me as their buyer's agent, and I will gladly work hard for them, show them as many houses as they want
That is the thing. I didn't want to look at hundreds of houses. I was looking at a very specific and small area next to my daughter's school. I knew what I needed.
Quote:
Originally Posted by HoustonPharaoh
Our job is not opening doors, there are many things that we handle on each transaction more than people can think.
I agree that you do a lot on your side, but that is why you are paid by the seller. And opening a door for a potential buyer is a part of your job.
We finally found a seller's realtor willing to work on our terms without giving us hard times. She showed us the house, never forced us to bring our own realtor or refused to show the house. And that realtor was rewarded for that.
The listing agent then agrees to pay the buyer's agent half of that negotitated commission. Right? So, if the buyer comes without representation, the listing agent gets all of the already agreed upon commission anyway.
Not neccessarily. In our situation, we wanted our 3% and we got it. We can't 3% in cash, but we can in a form of a seller paying towards our closing costs or taking that amount off the price of the house. And that is another reason seller's agents donot want to show houses. They get greedy and want their 6%.
Quote:
Originally Posted by marksmu
Its actually not even difficult.
Agree. It is not that difficult at all. I didn't find anything difficult and I am not an attorney.
Quote:
Originally Posted by marksmu
I am also an attorney..
In the state of Texas, according to the law, attorney can act as real estate agents. You can't get your 3% in cash, but there are ways to receive them as I mentioned above. In your situation I would definitely not hire a realtor. Don't see much sense.
Last edited by dosto; 07-25-2012 at 01:56 PM..
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This is not the first house we bought without the buyer's agent. 
