Understanding buyer agency
It seems to me that many real estate consumers don't understand buyer agency. Sellers will generally interview a number of agents with the goal of hiring the best real estate agent to list and sell their home. Buyers just want to see homes and therefore, they need an agent to open the lockbox and let them view the property. Most buyers really don't care who opens the door to the house for them.
But they should.
I got a call yesterday from someone who wanted to see a property this afternoon. They had found my website and searched the Charleston MLS. When someone only wants to see one house instead of inquiring about available homes by area, minimum square footage, number of bedrooms, etc., I kind of think that they think that I'm the listing agent for the house they seem to like so rather than just arranging to run out to meet them at the property, I engage them in a bit of conversation.
Are you working with another real estate agent. No, why. Well, we have to ask. Why. Because if you are already working with another real estate agent and if I'm not the listing agent for the home you want to see, then I can't show it to you. Aren't you the listing agent. No, unfortunately, all 10,000 available homes for sale in the Charleston real estate market that you can view on my website are not my listings. Who's the listing agent. Well, I could tell you but then I'd have to shoot you. No, I really didn't say that but basically, I'd be shooting myself and providing him with a loaded gun to shoot himself as well.
You see, if you want to buy a home and you don't understand buyer agency, you really shouldn't be buying a home. If you do understand buyer agency and choose not to use a buyer agent to represent your interests in the transaction, by all means, buy a home.
A real estate agent does more than open the lockbox and the door to the home and point out the obvious, such as this is the kitchen or that's a nice walk in closet in the master bedroom. A real estate agent offers a buyer negotiating expertise, knowledge of the area and experience in helping buyers avoid potential pitfalls when buying a home.
From the South Carolina agency disclosure brochure, all real estate licensees must...
Present all offers in a timely manner
Account for money or other property received on your behalf
Provide an explanation of the scope of services to be provided
Be fair and honest and provide accurate information
Disclose "adverse material facts" about the property or the transaction which are within the licensee's knowledge.
It further states, "Unless or until you enter into a written agreement with the company for agency representation, you are considered a "Customer" of the Company, and the Company will not act as your agent. As a Customer, you should not expect the Company or its licensees to promote your best interests, or to keep your bargaining information confidential." (emphasis added)
A buyer who chooses to become a client by entering into a written agency agreement can expect the real estate Company to provide the following client level services:
"Client level services also include advice, counsel and assistance in negotiations". (emphasis added)
As to the caller yesterday, he inquired about a $700,000 home, didn't understand buyer agency and may choose to be a self-represented buyer. I recommended he interview at least several agents (like most sellers do when choosing a listing agent) and find an experienced, professional real estate agent that he felt comfortable with to represent him.
The best part of buyer agency is that it doesn't cost you any money to be represented. The seller pays the commission to the listing agent who splits it with the agent representing the buyer. The usual disclaimer, the seller pays the commission from the proceeds of the sale provided by the buyer and mortgage.
It's your choice whether or not you want to be represented. But at least, now you know.