The Wall Street Journal reported on Thursday, May 5th that a 2010 report by the National Association of Realtors revealed that only 57% of home buyers were represented by a buyer’s real estate agent during the transaction. In 2009 that number was 62%. The article lists several reasons for this trend such as the prevalence of real estate information available to anyone online, and that some buyers may think their interests are being represented by the seller’s agent who is often in reality contractually bound to work in the seller’s best interest.
Some real estate investors may forgo a buyer’s agent as they are experienced in buying and selling properties having gone through several previous transactions, and because they believe they hope to negotiate a further reduced price in return for not requiring the seller to pay the agent’s commission from the proceeds of the sale. If you’re considering working on your own on a home purchase for the first time consider the following aspects of a real estate agent’s typical responsibilities to see if you are truly ready to go it alone:
- Pricing – Though there is some historical sale information available online it can be helpful to have an agent’s advice in coming up with the value of a home.
- Negotiations – The entire home buying process can often feel like one long negotiation. There is the purchase price, contingencies, closing date, repairs, what conveys with the home, and much more to work out.
- Coordinating the Process – In order for a closing to happen on time everything has to come together with the buyer, seller, mortgage lender, appraiser, home inspector, attorney and/or escrow agent. Fielding phone calls and emails, arranging access to the property, verifying everything is taking place on schedule (and taking appropriate steps if it’s not) can be time consuming.
If you are comfortable in some of these areas but not others, consider hiring professionals to assist you in just those areas you feel you could benefit from some expert advice. For example if you are an experienced negotiator but aren’t sure about real estate values in the market you’re house hunting in you might want to hire your own appraiser to get you up to speed. You could also have a real estate attorney review the contracts and advise you on legal aspects throughout the transaction
Video from the National Association of Exclusive Buyers Agents: