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My husband and I will be purchasing our first home in the coming year. We've already started to look at homes & we've met a few realtors. We found one realtor whom we really really like. We can talk to him very easily, he seems to understand instinctively what we're looking for, and he's just fun & easy to be with. We actually laugh when we're touring homes with him.
But.
He's pretty new to the world of realty. He graduated from an impressive university. And he has worked for a developer that recently built a large community in the area where we are shopping, so he certainly knows something about construction and about the area we like. But he seems to have only a couple years under his belt as a real estate agent.
So what to do? We really like this guy & I feel in my gut that we can trust him, but we've never bought a home in this country (Mr. Steel had a house in his homeland) & it's kinda concerning to think that we aren't working with an old pro. What do you think? Should we sign a contract with him since we feel so comfortable with him? Could we negotiate a better deal with him because we're offering to be guinea pigs (for instance, 2% commission instead of 3%, or even 1% cash back)?
Normally in this area the seller pays the commission. If you are comfortable with him and he is attentive and responsive to your families needs, by all means use him. I wouldn't ask him for any concessions on his commission. I'm sure he will earn it.
I understand that the seller pays the commission, but the seller also sets the price of the house and the buyer pays for that. So no matter what, the buyer is the one shelling out the cash, therefore the buyer is paying the commissions. Or at least, that's how it seems to me.
If you have any doubts of your realtors ability to represent you completely with fairness, honesty and knowledge I would say that is not very fair on the realtor or yourselves. Buying a home is stressful enough and if you find yourself stressing now, that is not a good sign of a match with realtor and client. When things get rocky or hairy thru the buying process you want to be able to ease yourself knowing your realtor is the best in your mind. And if that cannot happen now, it could make it harder on you both later.
If you like him and feel comfortable with him, go for it. It's not going to cost you anything, unless he has in the Exclusive Buyer's Agreement contract that you will be responsible for fees. And remember, you can terminate the buyers agreement with him at any time.
I understand that the seller pays the commission, but the seller also sets the price of the house and the buyer pays for that. So no matter what, the buyer is the one shelling out the cash, therefore the buyer is paying the commissions. Or at least, that's how it seems to me.
I don't understand how you feel the buyer pays the commission??
The seller doesn't "set" the price of the house, the market does and the buyer does to a point. Just because someone lists a home that is worth 350,000 for 400, 000 doesn't mean he will get that money.....
As the buyer you are paying for the house, the realtors commission is definitely coming out of the sellers proceeds...not yours. The seller is also shelling out cash at the closing.
To your original point, if this agent has "a couple of years under his belt" I would hardly consider yourself to be a "guinea pig". In this market, an agent with a couple of years experience likely has a quite a few sales under his belt.
It is hard to find an agent you feel comfortable with, so if you do, then go with him. If you want someone more experienced, ask him if there is someone in his office mentoring him (usually is if he is in a big office), also he has a broker in charge (BIC) that will give him guidance along the way.
As far as commission goes, in wake county, generally (because there is NO set commission) new construction commission is 2.5 percent of the contract price on the house, and resale is 2.4 percent. The seller pays the agents COMPANY the commission, and then the commission is split up. So, the agent really may only receive 60 percent of the 2.5/2.4 percent. Some agencies the split is higher, and it is also higher if you have been in the business for a while. So realize that he is not going to "get" all of that money. On top of the commission split, he is also going to pay taxes on the money, and pay for many other things with the money that are for work........so realize all of that if you asking him to discount the commission.
I have had friends who have decided to work directly with a builder on a new construction house (and the sales agent) and the builder gave them 2 percent off of the price of the house, instead of giving commission to an agent. For them, it worked, because they knew a lot about construction and felt comfortable with their knowledge both of the area, and the process of building a house. They knew the builder and the sales agent were technically not on their side, and they handled their situation with that knowledge. Now, that doesn't always work for people, but for them it did.
Anyhow, there is much more to the real estate job than the commission, which in the long run after all is said and done, doesn't end up with a huge paycheck per client.
Thanks for your responses, everyone. I really appreciate it.
And actually, I should correct my original post. He doesn't have a couple of years of experience. It's less than that. He just applied to join the Durham Regional Association of Realtors a couple of months ago. But we feel so comfortable with him & he's done such a great job showing us what he can do, that I think we'd like to keep him. Everyone's got to start somewhere, right?
Keep this thought in mind, if you have a good working relationship with the agent that is more than half the battle. I am a realtor and one of my biggest fears when I began was people knowing I was new. The fact that he shared that with you is very impressive, most new agents would "stretch" the truth. Plus keep in mind, if he is new he is not (probably) really busy so he will be able to give you the attention you deserve.
Good luck
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