What is a Buyer's Agent, Broker Agent, Dual Agent? Where do we begin?
May 6, 2021 3:17 PM Subscribe
First time buyers. We are looking for land for land to build a home on; or, alternatively, less likely, an existing home. NY/ Ct States.
Our first inquiry, (on Zillow) came back with an "exclusive right to represent agreement".
Under Client's Obligations, "Client agrees to work exclusively with Broker and not with other real estate brokers, .......with respect to viewing properties......"
Where do we begin? How do we look over a wide area, not narrow, and work with other agents? No agent can spend their time with everyone kicking tires; and no agent can cover a wide area.
We can provide a financial form to show seriousness and resources.
Recommendations?
Our first inquiry, (on Zillow) came back with an "exclusive right to represent agreement".
Under Client's Obligations, "Client agrees to work exclusively with Broker and not with other real estate brokers, .......with respect to viewing properties......"
Where do we begin? How do we look over a wide area, not narrow, and work with other agents? No agent can spend their time with everyone kicking tires; and no agent can cover a wide area.
We can provide a financial form to show seriousness and resources.
Recommendations?
My advice for hiring a realtor is to get recommendations from people you trust, then interview at least 10, and then you pick the one you like the best, as you're going to be spending a lot of money on them and you want to get it right.
The only time you can work with more then one realtor is when you have them working in totally different geographic areas, as far as I know no realtor will work with you unless they have some exclusive range. I was once thinking about moving to one of two cities (e.g. downtown big Canadian city or suburb of same) and had two realtors because downtown was a specialty niche condo-only market, but they both knew what the deal was and when I signed up with them it was very clear in the contract what they would and would not be covering.
If you buy a condo in Area A from Realtor B then you can get sued for the commission, if you promised Realtor A exclusive representation for Area A - don't mess around with that.
posted by tiamat at 3:37 PM on May 6, 2021
The only time you can work with more then one realtor is when you have them working in totally different geographic areas, as far as I know no realtor will work with you unless they have some exclusive range. I was once thinking about moving to one of two cities (e.g. downtown big Canadian city or suburb of same) and had two realtors because downtown was a specialty niche condo-only market, but they both knew what the deal was and when I signed up with them it was very clear in the contract what they would and would not be covering.
If you buy a condo in Area A from Realtor B then you can get sued for the commission, if you promised Realtor A exclusive representation for Area A - don't mess around with that.
posted by tiamat at 3:37 PM on May 6, 2021
Not sure how much this applies to land purchases, but the US real estate market is bonkers right now. Prices are up and house inventory is extremely low. Before you start shopping, educate yourself and get all your ducks in a row. Read a Nolo Guide about buying a house (not everything will apply if you end up buying land, but still a good place to start). If you're going to need financing, get that lined up. You do not want to mess around in this market.
Based on my experience shopping for property in a rural area, your realtor will be willing to travel with you. They are used to driving, and the Northeast isn't that big. Perhaps you could start with a realtor who serves CT/eastern NY and go from there.
posted by toastedcheese at 4:19 PM on May 6, 2021
Based on my experience shopping for property in a rural area, your realtor will be willing to travel with you. They are used to driving, and the Northeast isn't that big. Perhaps you could start with a realtor who serves CT/eastern NY and go from there.
posted by toastedcheese at 4:19 PM on May 6, 2021
My realtor showed me several houses (in Feb 2019) before he asked me to get serious and go exclusive.
Gosh, would you date someone who demanded exclusivity prior to the first date? I wouldn't, and dates are low-risk compared to houses, ymmv.
posted by SaltySalticid at 4:54 PM on May 6, 2021
Gosh, would you date someone who demanded exclusivity prior to the first date? I wouldn't, and dates are low-risk compared to houses, ymmv.
posted by SaltySalticid at 4:54 PM on May 6, 2021
Hey! I am selling a house right now. I had to sign a similar document. Basically, when you enter a real-estate transaction, the agent (whether you're a buyer or a seller) is going to ask you to sign an agreement that states you're going to use them — and only them — for a specific period of time. From what I understand, this is standard procedure. You can negotiate on some of the terms (how long they get to represent you, for instance), but I think most agents are going to require this.
That said, your question raises some other questions. You say that you made a first inquiry on Zillow. I'm not exactly sure what this means, but it almost sounds like you found a Zillow listing you liked, clicked a link, and got the legal contract back. And it almost sounds like you're not quite ready for that. Are you?
If you're just in the "we're exploring our options" phase, don't sign this agreement. You're just exploring your options. You don't want to lock yourself into an agent. You want to take the time to keep exploring, and then when you do find a place that you're serious about, then find agent you like. (And I'm not so sure that I'd do so through Zillow.)
But if you really have found a place that you like, then consider signing the agreement — if you've met with the agent and discussed your goals and dreams and found them acceptable.
After we sell our place (fingers crossed! inspection period ends tomorrow), my girlfriend and I will explore a wide range of options for our next home. We won't use an agent for most of this. We'll explore multiple states and multiple options on our own. And yes, we'll use Zillow for much of this. Once we find one or more homes that we're serious about, then we'll get an agent involved. But not until then.
tl;dr — Real-estate agents aren't for the early, exploration phase of homebuying. They're for when you've narrowed your options and are ready to buy.
p.s. As a guy who has made his living writing about personal finance, I feel compelled to add a footnote. Please remember that nobody cares more about your money than you do. Even an agent that ostensibly represents you is motivated by making the sale because that's how she makes money. Trust but verify. Be proactive. Your home is likely to be the biggest purchase you ever make in your life. Be certain that you're doing what's right for you. And, in my opinion, even the slightest doubt is reason to pull out.
posted by jdroth at 4:59 PM on May 6, 2021 [2 favorites]
That said, your question raises some other questions. You say that you made a first inquiry on Zillow. I'm not exactly sure what this means, but it almost sounds like you found a Zillow listing you liked, clicked a link, and got the legal contract back. And it almost sounds like you're not quite ready for that. Are you?
If you're just in the "we're exploring our options" phase, don't sign this agreement. You're just exploring your options. You don't want to lock yourself into an agent. You want to take the time to keep exploring, and then when you do find a place that you're serious about, then find agent you like. (And I'm not so sure that I'd do so through Zillow.)
But if you really have found a place that you like, then consider signing the agreement — if you've met with the agent and discussed your goals and dreams and found them acceptable.
After we sell our place (fingers crossed! inspection period ends tomorrow), my girlfriend and I will explore a wide range of options for our next home. We won't use an agent for most of this. We'll explore multiple states and multiple options on our own. And yes, we'll use Zillow for much of this. Once we find one or more homes that we're serious about, then we'll get an agent involved. But not until then.
tl;dr — Real-estate agents aren't for the early, exploration phase of homebuying. They're for when you've narrowed your options and are ready to buy.
p.s. As a guy who has made his living writing about personal finance, I feel compelled to add a footnote. Please remember that nobody cares more about your money than you do. Even an agent that ostensibly represents you is motivated by making the sale because that's how she makes money. Trust but verify. Be proactive. Your home is likely to be the biggest purchase you ever make in your life. Be certain that you're doing what's right for you. And, in my opinion, even the slightest doubt is reason to pull out.
posted by jdroth at 4:59 PM on May 6, 2021 [2 favorites]
I live in Westchester County very near CT and work in CT several days a week. I have bought and sold 4 houses in my time. If I were you, I would narrow down the area to a first choice area for example Brewster and Newtown and find a real estate firm that is located in the area and walk in and tell them you are looking for land on which to build. Or, tell them new construction if you can have a say early in the process. There may be some builders with land that they would develop for you.
Tell them that you are still exploring the area in which you want to settle and would sign a contract for a buyers agent as you get further into the process. If they won't work with you without an exclusive, fuck 'em. Find another agent or another firm. The only exclusive I would grant in the beginning is that you agree to use them on any property they show you first
posted by AugustWest at 6:04 PM on May 6, 2021 [1 favorite]
Tell them that you are still exploring the area in which you want to settle and would sign a contract for a buyers agent as you get further into the process. If they won't work with you without an exclusive, fuck 'em. Find another agent or another firm. The only exclusive I would grant in the beginning is that you agree to use them on any property they show you first
posted by AugustWest at 6:04 PM on May 6, 2021 [1 favorite]
I live in Western CT, on the border of NY State. I concur with AugustWest. Also, the real estate market here is just nuts.
posted by sundrop at 8:41 PM on May 6, 2021
posted by sundrop at 8:41 PM on May 6, 2021
Can report from western Mass that the real estate market is insane here. Raw land too. And good luck finding a builder on a timeline of less than a couple of years.
Can also report we had a terrible experience two years ago with our buyer’s agent despite them coming highly recommended. Luckily we used her only once we saw the house we wanted and had the deal done quickly. She was awful, and incompetent, even though she was highly recommended by several people. She almost cost us the deal by being stupid. So yeah, my view is do as much legwork as possible yourself and don’t trust even your own agent. It has to be even worse right now with so much cash flying around. We thank our stars we bought in 2019.
posted by spitbull at 2:44 AM on May 7, 2021
Can also report we had a terrible experience two years ago with our buyer’s agent despite them coming highly recommended. Luckily we used her only once we saw the house we wanted and had the deal done quickly. She was awful, and incompetent, even though she was highly recommended by several people. She almost cost us the deal by being stupid. So yeah, my view is do as much legwork as possible yourself and don’t trust even your own agent. It has to be even worse right now with so much cash flying around. We thank our stars we bought in 2019.
posted by spitbull at 2:44 AM on May 7, 2021
I'm in the market as well, in several different areas of the country. Its nuts everywhere. No one wants to wait for lender assessments, cash buyers have far more chances, even if they arent offering as much total money.
You dont pay your realtor. Their commission comes from the seller. If they say anything else, drop them and find one who isnt trying to screw you over. Ask them how far their 'territory' goes. If you want to look outside of that, let them know.
Get an inspection, estimates, whatever you need to make sure you fully understand what you're buying and what's possible. Your realtor should be calling the planning dept to verify details of what you can and cant do.
Dont seek loan approval until you want to put in an offer, but have a lending agent on standby.
posted by ananci at 8:06 AM on May 7, 2021
You dont pay your realtor. Their commission comes from the seller. If they say anything else, drop them and find one who isnt trying to screw you over. Ask them how far their 'territory' goes. If you want to look outside of that, let them know.
Get an inspection, estimates, whatever you need to make sure you fully understand what you're buying and what's possible. Your realtor should be calling the planning dept to verify details of what you can and cant do.
Dont seek loan approval until you want to put in an offer, but have a lending agent on standby.
posted by ananci at 8:06 AM on May 7, 2021
What do you want a broker to do? It sounds to me like you might be fine searching by yourself for a while using Zillow/RedFin and similar. Generally, the seller's broker charges the seller a commission of ~5% to sell the house and, if the buyer has a broker, that commission gets split in some manner between the two brokers. If you don't have a broker, sometimes that can be good for a small reduction in the price.
My wife and I used a buyer's broker the first time we bought a house - mainly because we didn't know what we were doing and we didn't know where anything was; the broker drove us around to something like 50 different houses and earned her eventual commission. But when we bought our next house, we didn't use a broker because, once we knew a little bit, it wasn't worthwhile.
If you are mainly interested in buying raw land, and if you have some level of savvy about what you are looking for, I am not sure a broker is going to add much value for you. Definitely don't sign any type of exclusive arrangement until you are more clear about what you want a broker to do for you.
posted by Mid at 1:41 PM on May 8, 2021
My wife and I used a buyer's broker the first time we bought a house - mainly because we didn't know what we were doing and we didn't know where anything was; the broker drove us around to something like 50 different houses and earned her eventual commission. But when we bought our next house, we didn't use a broker because, once we knew a little bit, it wasn't worthwhile.
If you are mainly interested in buying raw land, and if you have some level of savvy about what you are looking for, I am not sure a broker is going to add much value for you. Definitely don't sign any type of exclusive arrangement until you are more clear about what you want a broker to do for you.
posted by Mid at 1:41 PM on May 8, 2021
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Dual Agency means they are pretending to represent both the buyer and the seller, and it's a VERY BAD IDEA.. (Here's another article that says the same thing: Risks of Dual Agency). It's literally just both sides of a negotiation hiring the same negotiator, and it's really can't work out well for everyone.
posted by tiamat at 3:27 PM on May 6, 2021 [2 favorites]