Most prospective house hunters or sellers think they have a “good” agent. Either it’s someone who they previously worked with or perhaps a referral from a friend or a co-worker. One of the big reasons for having confidence in their agent is a belief that the agent is “on their side” and “honest” etc etc. I would suggest however that by a certain point in the process, your agent is your enemy and you are negotiating against them more than the other party. This post deals with the buy side of the house buying game. The next post will deal with the sell side.
In the beginning: happy friends
When a house buyer first signs up with an agent, things are usually pretty rosy, the agent assures the person that they can find an appropriate house for a price you can afford and everything will be great. The agent has “lots” of experience and knows the area inside out. At this stage of the game, you and your agent are mostly on the same page. You want to buy a house and they want you to buy a house. Your agent will most certainly want to get the process over with sooner rather than later, but that’s usually the case with the buyer as well.
During the search: uneasy allies
Agents know that they need to spend a fair bit of time with a buyer, especially ones who want to look at a lot of houses. After a while however it’s not worth it for an agent to continue a long search especially if their contract is running out. This is the time when the agent will start trying to convince the buyer to lower their standards and raise their prices. Sometimes this is educational if the buyer has unrealistic expectation, but mainly this is to speed up the process so the agent can get paid. I should point out however that real agents are normally quite useful during the search since they often know more than you do about the general real estate and can get you access to private showings. The other big benefit is their access to sale price information for similar houses.
Related – How to win a house bidding war
Thinking about putting in an offer? Trust no one!
The point when the buyer submits a offer on a house is a time when a lot of house buyers, particularly first timers feel out of their element and defer to their agent for advice. This is the worst thing you can do. Your agent gets paid when the deal gets done and only when it gets done.
This is a time when knowledge of the real estate market should be a big help in determining how much negotiation should be done. As well, if the buyer is not in a hurry to buy then that sets up a great negotiation opportunity. However if there is one thing that real estate agents don’t like it’s clients who negotiate hard – why? Because the only way to negotiate properly in a deal is to be able to walk away if the price you want isn’t met. The way an agent sees this type of situation is that if a deal falls through, they have to spend a lot more time looking at houses with you before they get paid.
Things that your agent might say (and you should ignore) when you are about to put in a bid are:
- “Don’t bid too low or you will offend the sellers”. This is garbage – if the sellers can’t handle a low ball bid then they are unrealistic. And what exactly is a bid that is “too low”? I’m not saying put in an unrealistic bid, but don’t be afraid to start low and work your way up. It’s important to know the market so that you don’t have to rely on the asking price or your agent to tell you the proper market value of the house.
- “Don’t bid too low or you might offend the selling agent and might I have to work with them in the future”. This stunning example of gall and self-interest was actually told to Mr. Cheap. I don’t think this one needs any further comments. 🙂
- “You should get a bid in quickly before someone else puts a bid in”. This is a favourite of my agent – create a sense of false urgency, get the deal in motion and get it done ASAP. Sometimes this is good advice, but other times – such as when the house has been sitting on the market for a month or longer then it’s just not appropriate.
- “Someone else is looking at the house later today and they are really interested”. This lie usually originates with the selling agent, but smart buying agents are usually more than willing to play along because it will increase the chances of their buyer putting in an offer in that day.
Negotiation – don’t listen to a word your agent has to say.
At this point you are potentially pretty close to buying a house. You want to buy the house at the lowest price, the seller wants to sell the house to you at the highest price and your agent wants you to buy the house and doesn’t care at all what price you pay because they just want the deal done right now. Since paying a higher price will get the deal done quicker, a lot of agents will encourage you to bid higher which basically means that you are negotiating against them as well as the seller.
Things that your agent might say (and you should ignore) when you are negotiating are:
- “Meet them halfway or in the middle”. This sounds quite reasonable at first- if the asking price of a house is $500,000 and you bid $460,000 and they come back with $490,000 then isn’t splitting the difference at $475,000 quite reasonable? Not if you can get the house for $470,000 or $465k,000 The fact is that the asking price of the house and your first bid are very arbitrary numbers and splitting the difference between the two might end up in a price that is not market value.
- “Are you willing to lose this house for $2,000?” (or $5,000, $8,000) This is a tough one – on the one hand it seems silly to not buy a house and be only a half of a percent away from a deal, but on the other hand shouldn’t your agent be asking this question to the seller? Ie – “We are going to walk, do you really want to lose this deal for $2,000?”
- “Are you willing to lose this house for $12 a month?” This is part two of the previous point which is applied if you don’t bite on the first attempt. It’s also a more useful gambit if the “separation” is a bit greater. If you and the seller are $12,000 apart, that sounds pretty significant, but what if you are only $75 a month apart (for 25 years) or even better what if you are only $63/month apart (over 40 years). That doesn’t sound like much (even if it is).
Conclusion
The more you educate yourself about the real estate market you are looking in and how real estate agents operate, the better off you will be when buying a house. Real estate agents are quite useful because they can get you access to houses for sale and will often drive you around to look at them plus they have access to the sale price of other houses. Whatever you do, never forget that they get paid when the deal gets done and only then. They don’t get paid for showing you more houses or walking away from close deals.
Tune in tomorrow when we take a look at the trustworthiness of real estate agents when selling a house.
Take a look at another perspective on real estate agents that Mr. Cheap wrote.
Do you have any good “lines” that you were told when buying a house?
588 replies on “Why You Can’t Trust Real Estate Agents When Buying A House”
Ok so I am a first time home buyer that got a realtor and signed a buyer’s agreement. I am willing to believe just like all professions there are good and bad realtors. My question is how would I know if I have a good one. My experience so far seems to be very similar to the one described in the article so far. Right up to where we put in an offer on a house we like. It sat for 61 days without an offer. Then at my realtors suggestion I put in an offer for the asking price. Then suddenly 2 more offers came in and my Relator is suggesting I put in my first offer for more than the asking price? I don’t understand why we can’t know each other’s offers? If someone wants to pay more then me for the house…they should get it. Why all the cloak in Dagger? I just don’t like the idea of bidding against myself before I even know what the offers are. My realtor seems like a really nice guy….but so do used cars salesman when you are on the lot. That is their job. It just seems like a job that rewards him for getting the most expensive price for the house available, even though he should be working for me? Thoughts?
The author of this article (Mike Holman) is very smart. He knows exactly how to generate a lot of comments on his site. He doesn’t actually believe what he writes, he is only interested in generating controversy. Yes, there are many bad real estate agents. Most of them stopped renewing their licenses after the 2008 banking crisis, but now that the market has vastly improved I am sure many will return for the “easy money”. If you want to buy or sell property, protect yourself by interviewing several experienced veteran agents and follow up by contacting their references. Finally, once you select an agent, be loyal to that agent and they will be loyal to you. If you hire a professional, you will be treated with respect, honesty, and integrity. But it is a two way street. Don’t call your agent with routine questions at 8pm. Don’t cancel appointments at the last minute. Treat your agent as you wish to be treated and you will likely have a very good experience. Developing a good relationship with a professional real estate agent can be a financially rewarding experience that can last a lifetime.
I’ve sold over 100 homes in the last 4 years. I find this article, and more importantly, these comments laughable. If you are being sued for $150,000 would you go to court without a lawyer? Please explain the difference in going to negotiate a $150,000 contract and not using a licensed experienced expert.
I know how much a kitchen costs to replace, how much tile is to install, how much a toilet costs, and whether or not a roof is warped and needing replaced….how do I know this? Because I’ve done it. Have you? Do you know the good areas of town? More importantly…do you know the ones to avoid? Do you know how many days of inventory there are left in the market you wish to purchase? Don’t you think this info would be important in determining your offer price?
No offer is too low? Why not just offer them $10 bucks? I mean if you listen to this author, don’t worry about offending anyone, just go throughout the neighborhood you want to live in and (even if the home isn’t for sale) offer each owner $10. Who cares about market value? Or rate of return? Or market trends?
Yeah, I would listen to this bozo and all the people on this website. I am SURE they have more experience and knowledge than I do. LOL.
I notice all the defense comments are from agents. Agents are shady!!!!!!!
Do yourself a favor and dont work with an agent if you dont believe in an agent.
After two straight days of looking at houses, we asked to see 4 houses for a second showing. What an odd coincidence every single house had a conditional offer on it already – or so we were told. After seeing the 4th house again, I asked to see a new construction just down the block again, our Realtor was surprised since it was not high on my list, but obliged. While we were looking at it again she went outside to ‘talk’ to the other agent. Wow, another conditional offer, you don’t say? What were the odds (yeah, about 100%)?
While I agree with some of your points, a lot of it is very wrong.
Example…….As of today, June 13, 2014, in the Dallas area real estate market, if I tell my buyers (who love a home) not to make an offer today, they WILL lose the house. Homes here are selling within a few hours of being put on the market. Those are facts. I’m of the mindset that a buyer has to lose at least one house before they listen to my advice. And, right now, if they do not listen to my advice, they do lose the home. It is that simple.
Yes, I agree with the your comment, “Thinking about putting in an offer? Trust no one!”. But, I would like to ad a simple caveat – including this blog! As a practicing real estate broker, I advice all my clients to perform their due diligence in all matters of their life because common sense dictates that knowledge is power. And most informed buyers will agree that a home is probably the biggest material investment anyone will make in their life. Do not let one bad apple spoil the whole bunch!
In the words of Abraham Lincoln, ” He who represents himself has a fool for a client”. On the flip side, most sellers understand the need for a listing agent. All buyers should know that the listing agents do not represent a buyer’s best interest. In my 20 years of real estate practice, I have never represented myself in any of my personal real estate transactions. I am no fool.
Much too often, media outlets and blogs use sensationalism and controversy to increase viewership. Real estate alarmism is not new to the industry. I recommend to everyone to always question the source and be “critically skeptical, and skeptically critical”. I only wish that the media exercised more responsibility before posting innuendos.
My REMAX realtor told me a complete home inspection was a waste of money . She knew I was on a tight budget. I was a first time home buyer alone with no one but my realtor to turn to. I listened to her through the whole process and boy, have I been paying for it ever since. She rushed me through the purchase and even tried to get me to close a week earlier than planned and to let the seller stay in the home for that week. Well, I was smart enough not to let someone else live in my home with my name on the house, utilities and my homeowner insurance. She said the elderly woman was having mini strokes and there was a chance she could have a major one and wouldn’t be competent enough possibly at the time of closing. I agreed to close early but the house had to be vacated first. This was so once it began raining in the early spring I would be stuck when water started coming into the basement. It has only gotten worse from there. I think she should be sued. Her deceit was obviously intentional and timed!
People use a real estate salesperson that has integrity. Various situations can arise during offer negotiations. It is true that the listing agent does not have to show you any details from the second offer (one that won or lost) and this is because of privacy issues (especially commercial when people use corporation number, interestingly commercial buyers never have issue like you posted in this article/peoples comments), the buyers don’t want to revel their identity or terms/price of the offer. It is my personal opinion that there should be a way to review other offers through perhaps a third party to protect the identity. The key is to have a strong agent that goes in and negotiates the offer for his buyer in the multiple offer situation. There are ways to make the offer terms looking great for the seller and I have had offers who won the bidding process with lower bid money put in, but the terms where very good for the seller. A good agent will ensure the buyer is served well and make the offer very appeal-able to the sellers. Always aim for win-win-win-win situation and this is easy if you respect the DISC personalities of people involved in the transaction. People who look for homes without proper agent representation are making a major mistake and loose in the process most of the time. They are usually tire kickers and the sellers know that and they want an offer that will stick. Think of it this way why would you want to be your own doctor, take your kitchen knife and do an operation on yourself on your kitchen table? Or when you are divorcing use your wife’s lawyer or represent yourself? Key is you have to trust the agent (find one that you can) and make sure the agent is professional and has your interest at heart (which we do)
I am not sure what type of employment your in Michael, but your coming across more as an idiot than someone who is actually intelligent. Why would you allow yourself to be taken so badly if your trying to come across as so knowledgeable and intelligent about the industry. I think anyone on here who has had a bad situation with an agent must be the people that believe that they are going to win publisher clearing house sweepstakes. Do us all a favor and stay home and dont speak. I work as a General Contractor and have met stupid people such as yourself, your usally the one standing behind me trying to tell me how to do the job, but you hired me because you have no time to do it. YEAH sure HA HA.
@Michele REMAX
I think your comment about “until they make a sale to pay their bills, feed their families and keep a roof over their heads” just confirms the author’s thesis about not trusting Realtors’ motivations.
I think it is sad that the author here paints every person in the real estate profession with such a broad brush. It is not fair to assume that everyone has the same motives; many of us in the real estate profession are quite ethical and do indeed work towards our clients’ best interests. I personally take pride in finding the best arrangement that I can for my clients…I want my clients to find the right house at the best price and I take pride in that; I would much rather have a happy client that refers me to others and that is only possible when your clients know that you are working in their best interest.
Most agents I have encountered drive luxury cars, lexus, porsche, infiniti, bmw etc. The ones I think are probably more trustworthy are the ones driving camrys and such, but they are few and far between. It doesn’t take much to be an agent as far as I can see, not much smarts, education, or talent, but they sure seem to make a lot of money. The whole 6% is such a scam. My agent tried to avoid giving me comps. Unfortunately I live in Texas where they keep sold info under wraps so I could not access that info myself. He also tried to tell me I was getting a great deal when from what I could see, the price I was getting was comparable or actually probably a bit more considering some ancillary things. I had done my homework and knew what prices were supposed to be but my mistake was showing I really wanted the house. I was also tired from looking and looking and not finding what I wanted. Stupidity on my part by saying too much and being too eager. My advice, always be willing to walk away and don’t show too much or say too much, especially about your finances. Assume whatever you are telling your realtor, he is telling the selling agent, and they are trying to make a deal, and that isn’t always in your best interest.
While I agree with you that there are many real estate agents who are unethical and are only out to make a buck, I think your article fails to shine the light on those who are ethical and do the right thing. As an attorney and broker, I see stupidity on a daily basis in this business, and I see it not only from a sales perspective but from a (scary) legal one as well. Still, not all agents are bad, and some know how to give the right advice and truly represent their clients – their advice is beyond valuable. I would NEVER push a client into doing something for the wrong reasons, because I would lose the trust of that client…this is more important to me that making money.
Telling people not to listen to their agents regarding negotiations is WRONG. Each market is different, and as area real estate professionals agents know and understand their local market conditions. Case in point: I have clients right now who were looking for a home. We made several offers, and because they did not take my advice (they wanted to do it “their” way), they lost out on several homes to other buyers. They then realized that my advice was valuable and we made an offer on another home, which was accepted. They thanked me for being patient with them while they figured out that I am the expert and know what I am doing. I stuck by them and wrote those offers, knowing they would not be accepted, and having told them that. Was it a waste of my time? No, because eventually they found the right home and learned to trust my negotiation skills. I now have satisfied clients who will refer me to friends and family.
You also insinuate that agents only work to make a buck. Although some may, there are many agents who work hard for their clients. Today I spent 5 hours giving a tour of the county to a client who MAY decide to move here – but it all depends on whether he gets a promotion. I still told him he should get to know the area in case that happens so that he can narrow down the areas he likes. I did not get paid for my time, and may never make money on it. Yet I created a relationship with a great person who one day may need my services, or may want to refer me to others who do….that is more important than making a buck.
I think you need to meet some agents who are true and hard-working. To me, it’s not about a “sale,” but rather is about creating relationships and helping people. I would rather meet 10 people with the possibility of never selling them anything then meet one person who will buy right away, but with whom I will not sustain a lasting relationship. I am offended by your negative views that agents are basically worthless except when it comes to unlocking doors.
Corrected comment
I recently hired an agent beyond shady- knew I had a deadline to sell as another home was purchased, blah blah I do flyers, promote this and that- his only strategy: lower the price- I am in the process if getting out if this- he laughs when you say “I will lose my deposit in the new house if you font make some effort”- forgets to send out flyers- won’t change incorrect items ( even when asked several times) to correct- serious errors n listing- glass not granite counter tops, no air conditioning when a new system was put in in 2014, dies not think new roof us worth putting in- worst and behind my back has a charge for administration to agents on the mls as well as a substandard commission for them: 2.25% which entirely deters people from coming. He’s wasted so much time 2 months before I found out how much he did wrong that I am left with 1 month to sell before I incur penalty . He does not do open house, he told me, he did not personally bring in one person- in addition he recommends a lewd, unlicensed contractor to “spruce up items” that person threw away pieces of my lights. He had thrown them into a soon to be tossed garbage area. Then he says it looked like I was going to lose a lot of money if the house did not sell.
When I told him this he cancelled and raged and ranted! This is just astonishing!
My partner and I have tried to purchase three houses in The Perdido Keys area of Pensacola. We have friends there and it is closer to our homes. It has been very obvious that they do not want gays in this area. After three contracts falling through, we fired out realtor and called Re Max and told a person on the phone our problem and told her that we had found a house and were pre qualified for $250,000. All she had to do is contact the listing agent and and tell them that she had a married couple who we’re transferring from the East side of Florida. All went well until the seller’s agent told us that she did not want to do a walk through. We insisted on a walk through because there were a list of things that were found on the inspection report and we want to make sure that the things were done. Her agent must have told her that we were undesirables and now she is running from from us.
She is not coming toothed closing and will not do a walk through with us. She is getting on a plane. on the day of closing and is having a service pack her up and the truck will pick up her things on the 17th. We have questions for her. And we bought some items from her. Her realtor wants us to bring the check to closing and he will it add it into her closing amount. Are we wrong to ask to meet this lady? We thought the items we bought were junt she didn’t want.
Thanks,
Peggy
P
I clearly see the problem here. Most people on this blog think they know how a real estate transaction should go. From A to Z. And the truth is, their expectations are flawed. You come to a buyer’s agent and ask them to represent you in your home purchase and they agree. But then you put yourself, knowing or unknowing in terrible positions to actually get the home you want after days or weeks when you find the “perfect home”. The agent knows this. You think you’re the first uninformed buyer they’ve worked with? No. An experienced agent has seen this before. How? As a new agent. New agents will do ANYTHING. They will run around town with ever person that calls themselves a buyer. Even put in your ridiculous $170k offer on a $200k listing. They see several times before they learn. I’ve seen my fair share of so called buyers lose out on homes because they wanted to negotiate hard. And then they blame the Realtor because they lost the home.
Let’s break this down:
During the search: uneasy allies
There are only so many homes on the market. If you have looked at 20+ homes then you are trying to stuff a $200k home into a $150k budget. It won’t work. You either need to increase your budget or reduce your expectations. This is one of the most common problems with buyers. They want what they can’t have or afford. If you enter the criteria of what you want into the MLS it will ONLY spit out what is currently available. I’m not able to pull the magical special home that doesn’t exist out of my ass.
Thinking about putting in an offer? Trust no one!
You mention knowledge of the market? What knowledge? The Internet has given you just enough information to make you think you have knowledge. YOU DON’T! Ok, so you mentioned negotiations and “walking away from deals”. Why would you even put an offer on a home if you don’t plan to purchase it? What is wrong or bad with this property to make you walk away? It’s not about overpaying for a home. You know what it’s about to you. It’s about winning. You feel that you have to beat the “other side”, the seller. You mentioned the only way to negotiate hard is to be able to walk away? ARE YOU SERIOUS? Walking away is NOT a negotiation tactic. Guess what, you walk away and the seller still has their home on the market and they will sell it, but you just lost a home that you liked enough to put an offer in.
Don’t bid too low or you’ll offend the seller. Well, I agree with this one, sort of. The only way you can bid too low is when the home is new on the market or it’s priced very very well.
Please explain to me what this means, “if the sellers can’t handle a low ball bid then they are unrealistic. And what exactly is a bid that is “too low”? I’m not saying put in an unrealistic bid”
You are contradicting yourself. A low ball bid IS an unrealistic bid. Is it unrealistic for a seller to reject an offer (by not countering it) if someone submits an offer at 80% of list price? Why? You want to come down in price right? I get it. So do I as a buyer’s agent. But when I see an offer like that, my first thought it, well this guy isn’t serious and I advise my seller client to counter back at full list price to not at all.
Again you mention, “know the market”? What resources do you (the buyer) have to “know the market”? Tell me? If you say Zillow or Trulia or some other online valuation system then you are putting your trust into a flawed system. Zillow and Trulia use an algorithm to valuate a property and guess what, it’s wrong most of the time. You have NO WAY of “knowing the market”. You can’t. You don’t have the resources. You see a home down the street that is similar to the home you want to put in an offer in and it sold at $175,000 so this home must be worth something around that. What you don’t know is how to do adjustments. Yeah, there may be a home or two that sold “around” that price, but what you don’t know is the value of the adjustments that need to be taken into consideration and there can be a TON of them. That home you’d like to put an offer in may have $25,000 of amenities the $175,000 home doesn’t thus warranting the $200,000 asking price.
“Don’t bid too low or you might offend the selling agent and might I have to work with them in the future”
If you hear this then you have a BAD agent. Period!
“You should get a bid in quickly before someone else puts a bid in”
Ok, do you even know why you are hearing this as the buyer from your agent? Because they have seen time after time after time, a buyer drag their feet and then lose a property because they took too long. Then guess what, they blame the agent. Ironic isn’t it! Why are you searching for homes in the first place? To put an offer in. If you look at 15 homes and you narrow it down to one property. What is the next step? DUH. Put the offer in. Why are you waiting 2-3 days? You are asking for trouble. Now I can see if the home has been on the market for 60+ days, but DOM are not the only thing you should look at. When was the last time the price was dropped? That is HUGE! If the price was dropped 5 days ago from $200,000 to $190,000 now the home has been opened up to a WHOLE NEW demographic of buyer’s. You can bet that the chances of a multiple offer situation has increased. Don’t just look at DOM, look at the last time there was a price reduction.
“Someone else is looking at the house later today and they are really interested”
Again this depends on how long the home has been on the market and when the last price reduction occurred.
Negotiation – don’t listen to a word your agent has to say.
Are you seriously advising people to “not listen to A WORD your agent has to say”? Why, because you know what you’re doing? Not likely. You actually think you know more about negotiations than the agent? Come on, you can’t honestly believe that? When you say things like, “and your agent wants you to buy the house and doesn’t care at all what price you pay because they just want the deal done right now” completely discredits this entire article if you want to call it that.
Meet them halfway or in the middle.
This is just such a broad topic that it can’t be tackled easily. You very well may be right especially if it’s the first round of counter offers.
“Are you willing to lose this house for $2,000?”
The only time I would ask this question is after I’ve had a conversation with the seller’s agent and I’ve ascertained (after asking a series of questions) that the seller isn’t budging any more.
In conclusion. Yes, I EARN a commission when a transaction closes, however that is NOT how I make money. If I had to rely on selling a home I would be in big trouble. I make my money, when I provide such an outstanding experience for my client that they refer their family, friends, co-workers to me. How? By helping them determine the right property, negotiating the best possible deal on THE home that they want, and helping provide as smooth of a process as possible.
Please take my advice and NEVER use Cindy xxxxx as your listing agent. The trouble began with the first interaction. She “mistakenly” wrote our listing contract incorrectly, by trying to list our home for one year. We made it clear we would only list for six months. We agreed on a date for an Open House, which would be the first viewing anyone would have of our home. Naturally, we worked weeks to make our home look perfect. Guess what? Cindy was a “no show”, instead opting for a ” much needed last minute vacation to Mexico”. She sent a replacement who showed up 20 minutes late, then spent the next 40 minutes placing signs for our Open House, which began one hour earlier. The flyers he brought were all incorrect and a cheap Xerox brochure. Incidentally, Cindy took ONE picture of our home. I provided her with the rest so there would be pictures to advertise with. My husband, daughter and myself had to host our Open House for the first hour to 27 perspective buyers. When I called her Broker, my husband and I were called liars. From then on, Cindy scheduled and cancelled showings without even consulting us. She claims she didn’t do this, even when provided with proof. She listed our home as “off the market” and told other realtors who wanted to show our home that it was off the market. She has sabotaged any hope we have to sell our home at this point with her incompetence and negligence. She doesn’t even have our home listed correctly with the MLS now. She has completely misrepresented our home to prospective buyers. When we asked once again to have our home unconditionally withdrawn, her broker told us that if we paid her $1,000, she would agree, which sounds very suspicious to me. We have now been told not to contact her broker or her agency. Imagine that, you are being held hostage because a real estate agency refuses to release you from their contract, but you can’t contact them! Please don’t ever let this happen to you and avoid CINDY at all costs. This past two months has been a nightmare dealing with such sketchy people. Use a more reputable company and check their reviews and references. If we had done that, our home would be sold by now. Can you give any advice on what you’d do at this point?
I almost never use a buyer’s agent/Realtor. After I do my own due diligence on a property, I contact the seller’s agent request a walk through, thank the agent for their time and then decide if I want to proceed with making an offer.
If I should decide I want to make an offer, I contact the selling agent and request to make my offer in person, with the seller’s agent present. That way I am able to answer any question the seller may have with my offer and it is not left to interpretation buy the agent. If the agent denies me this meeting I simply go on to the next property.
Wow, you guys have had some bad luck 🙁
Im fortunate to work with some amazing REALTORS who i can look up to.
Our number one priority is our client, i personally place my clients interests before my own because 1. its the right thing to do 2. it results in referrals
You control the contract, make it for the 1 house, or 1 month, or 3 months if you have had negative dealings with your local REALTORS.
Fire your REALTOR if there is an ethical or service related deficiency. Contact their Board of Realtors and complain if you are not getting satisfaction from the REALTOR or their Broker.
Or just move to Texas and look me up 🙂
@Michele w/Remax. You are a good reminder not to use Remax. Your hours of real estate education (while others spend years in higher education) isn’t enough. If you learned anything you would know not to spout off and put your company name next to yours. I will never use Remax. Your unprofessionalism in this thread says it all and is the reason for such an article to be written in the first place.
I’ve been buying/selling for years now and realtors truly are the most ethically challenged of all occupations. At least we know what we’re getting with a used car salesman. They ride around in their luxury cars from the blood of unsuspecting “clients.” More like their victims. I truly think most have borderline personality disorders or some other diagnosable mental disorder qualifying under the DMS criteria.
This guy is crazy. Everyone should be careful about doing any kind of business but this guy doesn’t have a clue. He is probably the same guy that says don’t bother paying the IRS they can do anything to you.
Maybe get your own license you IDIOT
I am not sure what your point is in this article, on each point you first say that what your agent is telling you is bs then right after you write…”well , at times that’s a good suggestion”
My suggestion to you is that you make up your mind first then write an article that tries to discredit (or not??) the work of a real estate agent!
What do you get when you cross a pig with a realtor? Nothing – there are just some things that a pig will not do.
As a Realtor, I will agree that there are agents described in this article. My personal estimation is that in my area there are approximately 5% agents/Realtors without scruples. There are also approximately 5%buyers and 5% sellers that lie and manipulate to get what they want. Michael, is most definetely in that 5% range. Seems to me that 5% of the general population fit the mold that Michael (article writer) describes.
If you feel that you don’t need an agent, by all means try to buy or sell your home without one. Statistics show that having a real estate agent on your side saves both the buyer and seller money.
If you choose to work with a Realtor or Real Estate Agent;
1) Do your homework. Interview them in the same way you would hire any professional; (Accountant, Lawyer, Doctor, Dentist, Contractor). Not only do you want to hire a Realtor that is knowledgeable about the local market, you also want to make sure that your personalities mesh. Buying and Selling a home is a very stressful time in ones life. It only compounds problems when you are having personality conflicts.
2) Trust and have Confidence in the Professional that you have hired. If you believe that you know-it-all; if you don’t step back, it’s likely your agent will fire you. After business overhead costs Realtors do not make the high incomes Michael/Writer assumes. In addition to administrative costs, constant continuing education, marketing costs (signs etc), lock boxes, lock box key charges, GAS, MLS fees, Association fees, desk fees. A good Realtor will not have time or energy to hassle with a difficult client. My guess is that Michael/Writer fits into this category.
3) List your house at fair market value/Offer close to fair market value – Listen to your agent. Sellers want the most they can get for their home. Most agents are very good at evaluating the current comp of a home. If you list too high, the house will sit and sit and sit. The longer it sits, the more buyers question what is wrong with the house which makes them want to offer lower. To get the best offer you must price right at the very start. Always counter an offer. Start negotiations. Nothing says you have to except too low but be prepared to lose the buyer. Buyers want the best deal they can get on a house. Offering too low puts them at risk of losing the house too. Be prepared that you can lose it to other offers. The best deals I’ve made are when both the buyer and seller want to make a deal and are willing to negotiate. Otherwise, someone gets seriously anrgry and ends the deal which means no deal. No deal means EVERYONE has to start again. Yes, the agents want a commission but it is in everyone’s best interest to complete the deal. If not, what are you doing listing and/or offering?
Buyers and Sellers are not the only ones who have to deal with the 5%. The other 95% that includes hard working knowledgeable Realtors and Real Estate agents have to also deal with their antics. They prevent other agents from seeing their listings. They will lie and say a house has on offer on the table so that the Buyer will call the Seller to purchase. They will “forget” to put a key in a lockbox so the agent can’t show the home. They will give the wrong alarm code so the agent looks bad. Becoming a Realtor eliminates most of these behaviors but just like any profession there are those who break rules and laws. When you encounter a Realtor that plays these narrow minded short sited games, find another. If a Realtor does this, who knows what else he/she will do. Just remember, that a few bad apples…..
The person who wrote this is obviously not a licensed realtor and knows nothing about real estate. Hiring a good agent can potentially save you thousands by getting you what your house is worth. Also, the longer the house sits on the market the lower the price the house sells in general…
Ashley
I puchased a house in March 2014 my real estate agent was awesome but I can’t say the same for the listing agent or seller. I am in litigation now for sellers breach of contract as everything that was on an amendment was not completed as the seller and listing agent indicated that it was. They both lied through their teeth and I am not having to go to court and try to get them to take back the house. I acted on reliance when my real estate agent told me the work was done and now I am left holding the bag.
I have a shore property I am going to list (pocket listing) in a couple of months (Feb). There is one family that I do not wish to sell to at any price. Am I legally bound to sell it to them if they put an offer in at full price? I am not in a hurry to sell it and will rent it out if it does not sell in the Spring. My concern is my liability by refusing any offer they may submit.
First let me say I am a Real Estate Agent and your article is so awful, so misleading and so full of uninformed, misguided and quite frankly it seems it just happens to be in your head and you write it situations. Realtors are definitely not perfect but they are definitely a lot better than the quality of this post.
All of you are hilarious! Go try to buy a house listed with a realtor without a buyers realtor. They will laugh you to the curb. Why you ask? Because that listing realtor realizes that they are going to have to do all the work of a buyers realtor without the compensation. Because you think that you can: do the past history price research for the house, the neighborhood, and the part of town(because you might want to put in an educated offer)-do all of your own title and deed research(knowing of course the different types of deeds and what rights they convey)-make sure that the integrity of the property boundary is intact(no encrochments, adverse possession attempts, or unknown easements,etc)-get all the forms together along with the correct info(P&S+all applicable addendum, and any state, county, or city regulations that might apply to said property,etc)-fill out said forms correctly (remember genius, this is a legally binding contract if accepted at some point)-present your offer to the listing agent(hopefully he can keep a straight face)-and then try to negotiate with said listing agent(when after he looks at your paperwork he knows full well you have no idea what you’re doing)-then by some act of god you get a signed around deal finish title-get a good home inspection-get all the info your lender is going to want about the deal-if you live in a state that requires it, get a reputable surveyor to survey your property: what? You don’t know if your state requires a current survey to transfer real estate? Should’ve done better research because now you’re out if time to get a survey done the deal falls through and you’ve kissed the property and your earnest money(which is substantial because any agent with their salt would have advised their client to required someone like you to put up at least $5k)-but you probably would have lost the deal earlier by not meeting one of the multitudes of required deadlines. When in reality, if the property was worth having, it would have gone pendind(do you know that word? It’s important)before you ever got your research done to put in an offer! It’s a shame Realtors have to put up with the type of idiots on this post, but hey, everybody has to make a living right. Used car salesmen? Ha! Spoken like a true idiot. all you idiots need to go find fysbo’s( don’t know what that means?) and give realtors more time to help real people. Not jacka$$’s that know the price of everything and the value of nothing.
Unlike some of the other comments, I found this article to be very helpful. Its all about being educated before making a major decision that can affect your life. Too many times we rely on “professionals ” to guide us blindly. Everyone’s out to be the winner. The buyers want to save the most money and the sellers want to make the most profit, and the agent knows there’s a PAY DAY at the end of this for the. The person who wrote this article DID NOTHING WRONG! What is wrong with opening someone’s eyes to the truth.? A doctor once told me that I needed to do my own research because doctors don’t always have the answers and due to that they will often prescribe the wrong medication. If we the clients were more educated on our choices, we would have our eyes wide open and then we will ask the right questions. In the end its a cut throat life out there and I’m just thankful that I’m now equipped to see the tricks that might come my way, and now when I’m ready to get an agent I will know what to expect.
The basic problem is that the agent is on the agent’s side! Think about it – you’re goal is to buy or sell a home at the best possible price. The agents goal is to sell you a house – or sell your house – as quickly as possible at any price because that’s how he or she earns a commission. This can make the two of you “natural enemies” at some point in the process.
The problem is worse when you’re selling your home. You’re trying to get as much on the sale as possible, but you’ll have the real estate commission to deal with. That will not only reduce the sale price, but it will reduce the cash you receive from the sale even more. People don’t always grasp that while the commission is based on your sale price, it’s paid out of your equity. That makes it a bigger problem than “just 6%”.
Wow, this article is so full of ignorance I feel bad for the author. First of all if the agent signed a contract with the buyer then the agent is working for the buyer and by law has to do what is in the buyer’s best interest. If you submit an offer with the agent who has the listing that agent cannot give you advice on price, stay neutral, but really by law first obligation lies with the seller. Which is why the buyer and seller must agree in writing to dual agency. I’m s real estate agent and like someone above had said we get 80% of our business from referrals and word of mouth so we aim to please our clients. I have seen buyers lose a home because they don’t want to come in too high and they assume the seller will respond to their offer but a motivated seller will accept the best bid and reject the other. It comes down to how much you love the house, 2000 equals about $5.00 extra on a house payment so is it worth losing the house for that, same thing can be said for a motivated seller, is it worth losing the buyer over 2 grand and then paying taxes for a few more months? There are bad REALTORS. I know, I have had the pleasure to work with a few. It really upsets me to see people who get stuck with a poor agent but majority of agents are not like that and I am sorry for whatever may have happened to the article of this author. P.S. it is absolutely illegal to say there are other offers if there aren’t, we take an oath to be honest. YOU HAVE THE RIGHT TO REPORT ANY UNETHICAL OR ILLEGAL ACTIVITY TO THE LOCAL REAL ESTATE BOARD OR TO DEPARTMENT OF LICENSING & I encourage anyone who has had a problem to do so.
Also, unless you sign a buyers agency with your agent, they technically work for the seller and are not a buyer’s agent but a sub agent working for the seller.
I always suggest a buyers agency contract to my clients because I want to work for them to get them the best I can and they oblige wanting me to work for them also.
So just because an agent is showing you houses does not mean they are a buyers agent, ask to sign a buyer’s agency agreement!! Hope this helps as the article didn’t actually give any logical advice and half the information is false.
I bought a house and my closing date was suppose to be Dec 29th and today is Dec 30th i have no keyes no title and no where to go my Uhaul is packed and my house is sold and someone took posession today so now everyone is saying to go rent a hotel and sue the seller???? WTF this is crazy I have no were to go and I have a 4 year old and everything was signed and money transfered from my bank to the lawyers so why do i not have a house today is beyond me.
Check out Redfin.com Redfin is a full service brokerage whose agents do not get paid a commission, they are salaried employees but the bulk of their pay comes from bonuses after closed transaction, the kicker is that the client has direct influence on these bonuses with the way they respond to a survey they receive after the close of escrow so the agent’s top priority is customer satisfaction, if the client is not satisfied then their bonus is adversely affected. Redfin also gives a portion of the commission back to the buyer in the form of a refund that is not taxable income. The website and apps also make it super easy to get out and tour homes, they have special agents who only show properties and really work to get you out during your time preference. It’s worth checking out if you are tired of traditional model.
Any “so-called expert” who would put into print, “Negotiation – don’t listen to a word your agent has to say,” is just WRONG. To paint a picture of real estate agents as untrustworthy across the board is completely unfair and irresponsible. There are apparently some statistics out there indicating that we are not very highly regarded. And because the Internet is the ‘wild west’ as far as biased opinions, wild accusations and ignorant “experts” are concerned, it goes without saying that you should not believe everything you read, despite how nice the page heading looks or how many blog articles they have written. I have been a residential Realtor for a little over 10 years and was in commercial management for several years before that. For much of that time I was a military reservist, holding the highest security clearance our government issues, so I take honesty and integrity very seriously. When someone whose credentials and experience I do not know of starts making blanket statements as to why I or those in my profession are essentially dishonest crooks, I take notice. As covered by other agents above, not everyone in my industry is honest, trustworthy, or always correct, but the majority with whom I deal do meet those criteria and strive to do the best for their clients/customers. But I will say one thing as a long-time military/law enforcement analyst, many more “expert bloggers” will mislead you than Realtors.
Whoever you are, you’re retarded. Seek mental help. If you were an idiot and had a shitty experience, it probably had a lot to do with the fact that you didn’t do your due diligence in finding a reputable real estate agent. Like in any field, there are terrible professionals (using the term loosely). But for you to create an article that blanket statements many agents is a detriment to home purchase and selling consumers. You are more than likely a shitty person too.
Talk about some bad advice in this blog.
“Don’t bid too low or you will offend the sellers”. This is garbage .
As I seller I can confirm you WILL offend the seller. I had an offer come in 15% lower than my list price. Not only did I refuse to counter I wrote REJECTED over it and sent it back. My realtor supported my decision and not once tried to pressure me to accept it or counter it. THAT was garbage. The buyer resent a new higher offer I may have considered if it had been submitted initially to counter BUT I was so over this game playing already so why bother. I can only imagine how the inspection would have gone. I REJECTED it again and 3 weeks later got a much higher offer from couple who could close in a month and only required minor repairs and no closing costs. Don’t promote garbage as fact.
Also to all those commenting on here who have never sold a house. The seller pays their agent a commission. If a buyer is not paying his agent then I authorized my agent to pay up to half that amount to the agent. NOTE a buyer without an agent wouldn’t have resulted me in lowering my price any as I STILL would owe the same amount to my realtor. She would have just gotten the full amount. That is in the contract and why would I care? I agreed to a commission rate to sell my home. Whether the buyer has an agent or not didn’t concern me. The BS spouted on here by people who have never seen a listing contract or sold a house amazes me. When I bought my new house I used my same realtor and my contract did not require me to pay her. She was paid as an incentive through the seller’s authorized commission split, otherwise I would have had to pay her directly. People on here run their mouth when they have never bought or sold real estate. I’ve sold 3 houses and bought 4.
This author is 100% accurate in his assertions about realtors and their shady practices (whether legal or not). DO NOT PAY ATTENTION to all the realtor comments on here trying to defend themselves. I can tell you from personal experiences as a buyer and seller and acting as my own listing agent that the author of these articles is very experienced about realtor practices. My mother is a realtor and my father an attorney who owns his own title insurance company. I have been privy to that inside track my entire life and “BUYER and SELLER BEWARE!” I can’t scream that loud enough. Any realtor who tells you to relax, they have you covered, is essentially telling you not to be the master of your own domain.
If you haven’t noticed already, there is big money to win and lose in real estate. It’s a cut throat business and yet an incestuous one. Agents will compete with each other fiercely at the same time they will defend that special club vehemently when challenged.
This author is shining a big spotlight on a dark, sinister, two faced industry. I grew up in the D.C. area remember a clothes company in Falls Church called Syms with the motto, “An educated consumer is our best customer.” It’s funny how that’s stuck in my mind since childhood. I pondered that philosophically and came to understand that discounted gourmet products require budget-minded, gourmet tastes.
Real estate kind of works in the opposite direction. The industry wants you to appreciate granite counter tops if it means you’ll be willing to offer more money, but not if it means you want more money for your house. There is a lot of competing logic in real estate. Improvements can mean higher commissions for realtors and yet, the market won’t always yield sufficient returns for improvements. There’s a lot of mystery and unpredictability in real estate, which is why the client’s faith in realtors is so important to the industry. Realtors themselves are often just as shocked by outcomes as are their clients. Most will not let you know that vulnerability. That’s why you have your agenda and they have theirs. If a realtor tries to steer you away from that realization, run in the opposite direction.
You should always feel yourself an adult and equal player in the room with realtors! Be mindful of their time and don’t take advantage of your realtor. They can work very hard for their money. Believe me, I am sympathetic. But no matter how difficult they have it, you have your own financial concerns and home preferences. Realtors will famously remind you that they have kids to feed as though you don’t have your own to feed! Don’t allow yourself to fall for those guilt trips. No one twisted their arms to settle on 100% commission-based jobs.
I’d like to see the real estate business cut in half. Wouldn’t the world be a much better place with fewer realtors who were the best and brightest in the field? With less competition between them, they’d have more time to focus on doing the best job for their clients. We can all have our dreams, eh?!
FYI, I sold my house using an online MLS service. The house sold in early 2014 for approximately 17% more than any house had sold in that neighborhood since the real estate bubble burst in 2008! You read that right. I am NOT a realtor and I got more money for myself and my family by not using one. Enough said. Do your own homework. Work your ass off to help yourself. I walked away with a lot more money after understanding that an extra $30,000 in my pocket was not worth a listing agent’s time in his/her pocket.
The numbers don’t lie and the truth will always set us free…
Mr. Cheap, your nickname says it all. Most of your rant is baseless and if you think you can do better in selling homes try it. You know the saying. I judge you based on my character. Today you are talking about realtors. tomorrow something else. Reading your personality there is nothing good enough. So I’d say your character is dirty for most of your life. Probably ugly looking and single perhaps gay with you buddy being mad on the whole world. I’m not surprised. remember cheap talk means nothing! Just making fool of yourself.
I was sold a house that I found out had lead in the ground all around the house, nothing was vebally said to me when I bought house except that there was lead in the paint chips and I didn’t have to worry because I had no young children to get them in their mouth. Now I have lead poisoning and I did an inspection and was told their was lead in the ground around my house. Do I have any recourse , of course not, I have no way to move. I am disabled and have a very low fixed income and I am 62 years old. I think real estate agents should be more percise and trueful, especially when it involves health issues
This article resonates with me. I am going through this scenario right now. I am a buyer and my agent has pulled every single line mentioned in this article in the negotiation process where I am standing firm on my price. One more thing I would like to add to the list that my agent mentioned to get me to accept seller’s counter:
“The seller is going to start dropping $5000 each week and by the time he reaches to the price that he is willing to let go of the house he will have multiple offers.”
mine found my son a house with a foundation so bad the house is condemned…lied about what an escape clause was (told me it meant i had only 3 days to close…over a weekend no less)…told me she knew a good home inspector (her flunky who would OK anything to get her a sale)…set me up with her flunky lawyer who sold me title insurance with stewart insurance who never paid a claim in their lives)…then sold me out to the other side’s lawyer giving them information that may hurt me in court because she and the home inspector are being sued together on another case ….class act after we didn’t sue the listing agent after she went to work for them as to make her life easier…thanks to her and all the same ilk that sell real estate.
Realtors, be they buying or selling agents are out for no one but themselves. Their only interest is getting paid as soon as possible. They have zero interest in you whether you are buying or selling.
And last, but not least, their commission rates are ridiculous. That’s the biggest problem I have with them.
I am in the midst of deal with a “flipper” who wants to buy an estate house I own. Their offer was significantly lower than my asking price, but I also took into consideration it’s condition. The buyer also offered cash, which makes no difference to me as long as he can provide POF. In the midst of getting the AOS together, the buyer wanted to put a clause in the contract stating that the deal would be charged $100.00/per diem if the property wasn’t vacant. I said no to this and they said they would walk.To test them, I offered an addendum to the contract stating that they could charge the 100.00 ONLY under the condition that property was not occupied as the condition agreed to was “as is where is”, no inspection, nothing. I also set the condition that the buyers had to provide a VOD from a bank official stating that they had the funds to close. Today, my agent called me and said that the buyer wasn’t interested in asking for the $100.00 per the addendum but that if I wanted to continue the deal I had to sign today.
So far, the buyer has has not provided proof of funds as requested. And now my agent is saying that he will bring over some sort of proof because the buyer just completed a deal elsewhere. I told my agent I wanted a VOD and that a bank officer had signed it legitimizing the funding and verifying with bank statements and account statements and the letter.
I am taking no one at their word and want documentation, as we al know “buyers are liars”. My signature is contingent upon these items.
Be prepared fro cash deals or you may not close.