Return to listings

In all of 2011 I worked exclusively as a buyer agent and didn't take any listings. In 2012 I will start taking listings again. I quit taking listings in 2011 because the market had turned and many sellers had not yet realized that prices were going lower. I believe now that home sellers are more realistic, so I will work as a listing agent representing sellers as well as a buyer agent. If a buyer likes one of my listings, I will advise the buyer to get a buyer's agent if they feel there is a conflict of interest.

I look forward to Savannah real estate market in 2012, which I believe will be a better market for sellers.

Why would a Buyer Agent negotiate for a lower price

If a buyer agent negotiates a lower price for a home, it reduces the amount of the buyer agent's commission, so what motive does a buyer agent have to get the buyer a lower price?

Good question. Let's answer it in a round about way that better explains the mindset of an exclusive buyer agent. First, after the commission split, a difference of $10,000 or $20,000 in the price is not going to amount to that much less in commission -- maybe a couple of hundred dollars. But even if it's $300 or $400, it doesn't matter. It's worth it. I want that reputation -- an agent who wants to get the buyer a lower price on the home so I can lose commission money. Crazy, but true.

An exclusive buyer gets business by doing a good job protecting the buyers' interests and doing what he/she says he/she is going to do, including saving money -- word of mouth is the best form of advertising -- so consider that $200, or whatever amount, as advertising costs. If a satisfied buyer refers just one buyer in the future, which most of them do, I consider losing that $200 or so a good investment. The more I lose, the better satisfied is the buyer and the more likely I'll get referrals in the future. That's cheap advertising, because, I don't know about other area, but here in Savannah Ga, magazines and such stick it to agents. I feel like I've saved money and invested it well.

An exclusive buyer agent has to have a mindset that focuses on saving the buyer time, money and hassle. Listing agents get awards based on the dollar amount of their sales based on the total of the prices of the homes they sell. When I first started as an exclusive buyer agent, our company gave awards based on the total amount of dollars we saved buyers in the transaction. My last year with that company I got the highest award by saving buyers more money than anyone else in the company.

It's a different mindset -- it has to be, to be good at it.

The difference between a buyer agent and a listing agent

A listing agent is a real estate agent who works with home sellers to list and sell their properties. A listing agent represents the seller and has fiduciary responsibility to the seller. Traditionally, this was how real estate sales were conducted -- a real estate agent would list a property for sell then attract buyers and attempt to sell them on the property.

Over a decade ago, now, it became apparent that buyers were at a disadvantage because they had to depend on the agent representing the seller, so some agents started offering buyer agent services to represent the buyers. Exclusive buyer agents work only with buyers and do not take listings, so there is never a conflict of interest.

The listing agent, when they put a home on the market for sale, offer to split their commision with any agent who brings a buyer, so when a buyer has buyer agent representation, the buyer doesn't have to pay out an extra amount to pay for the agent's services.

When I represent a buyer, I look for the homes that meet the buyer's criteria and then when we go out looking at homes, I look at each home from the eyes of the buyer -- what repairs does it need? Is it overpriced? How will it do when it's time to sell the home? What is the area like and what kind of changes are happening in the area that could affect home prices?

This is part of the value of having a buyer agent -- you have someone who knows the area and the market and is on your side. Plus, you develope a trusting relationship with the buyer agent and it's a more pleasant experience not having to talk with numerous listing agents who are trying to sell you on their listing.

In the next couple of days I will answer the most common questions asked about buyer agency.