Using A Buyers Agent – There Are Many Benefits And One Word Of Caution
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When looking for a home, some buyers hire an Agent known as a real estate Buyers Agent. There are many advantages in using a Buyers Agent. I also offer a word of caution.
A Buyers Agent is licensed to work exclusively for the property buyer. They do not sell real estate, meaning they do never represent sellers. They work exclusively with folks looking to buy property. Buyers Agents work with you to research good locations, find specific properties, negotiate the price, and represent you as otherwise required.
The type of agreement you sign will determine how the arrangement will work. If you find the home on your own, usually a reduced commission will be paid to the agent. Typically the more the Buyers Agent does for you, the more commission you will be required to pay. This is not so much a positive or a negative as something to be aware of when working with a Buyers Agent.
Assuming the Buyers Agent is professional and proficient, he/she should save you considerably more than they charge, simply by negotiating a reduced purchase price AND ensuring you buy the right property in the right location.
There are many advantages in working with a Buyers Agent. At your initial meeting, you will describe your needs and budget so the Agent can help you find the best property that meets your requirements. Be sure to talk about property size, who’ll be living in the property, any renovations you are willing to do, specific location, lending requirements and budget. The Buyers Agent will then search for a property that matches. He/she will also advise you to arrange a professional building and pest inspection prior to the property going unconditional to ensure you are purchasing a safe, clean environment.
Buyers agents also have access to comparative market reports, which show the prices of similar properties. That way if you are thinking about buying a particular property, you can see how much other similar properties are worth. Knowing how much similar properties are worth will impact the type of offer you make to the vendor (seller). You get great representation if you are dealing with an exclusive Buyers Agent. He/she acts in your the best interests to ensure you get a great home and that the price you pay reflects the actual value of the home.
While using a Buyers Agent in your search for a house has many benefits, you need to be cautious when choosing your Agent. If you choose to follow up on a listing posted by a sales agent, that agent is working for the seller and not you. It is a legal requirement that the agent acts only for one party – either the buyer or the seller. If an agent normally sells property, he/she is not a Buyers Agent and you should find another agent who works exclusively for you.
To ensure you do not get caught out, when you start working with an Agent, sign an exclusive Buyers Agency Agreement, otherwise the agency might not be representing your best interests.
In summary, only a minority of property buyers engage the services of an Agent (Buyers Advocate), yet the majority of sellers engage a Sales Agent. There is an irony here in that the majority of mistakes are made when buying NOT when selling real estate.
As a property buyer, when selecting your Buyers Agent, do so with care and ensure he/she is working exclusively for you.