Home Buying in Brooklyn>Question Details

Todd, Home Buyer in Brooklyn, NY

Co-Broker or go alone?

Asked by Todd, Brooklyn, NY Mon Sep 15, 2008

I found an apartment that I like without the aid of the realor I was using. Is there an incentive to the seller to bring down the price if they do not have to co-broker the property and pay commission to a second realtor? Can that be used in negotiating? or shoud we bring in another real estate agent because it will not make a difference?

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In apartment rentals usually the agent charges the prospective tenant looking for the apartment not the owner. So it doesn't matter if you use a real estate agent or not.

If this is an apartment like a co-op or condo for sale, it can make a diffference sometimes. The thing is most of the time a skilled real estate agent can negotiate hard for you because most of the time sellers over price their property with or without using an agent.

But it's good to have an agent to give you comps, do research for similar properties, negotiate and be able to sink reality into a seller, to get a seller's concession, agree to terms in the contract, set up and attend inspections on your behalf, work with attorneys which can be difficult, come up with solutions to any problems that may arise and set up and attend the closing.

Real estate is not a cut and dry process and you need an experienced and accomplished real estate agent to represent you to make sure your are protected all the way through.
Web Reference: http://www.KandHhomes.com
0 votes Thank Flag Link Thu Oct 2, 2008
You should seek a qualified realtor to do the job.
This is our profession and we get paid to negotiate the best deal for our clients.
Some may disagree and think that they can negotiate a better deal, but that's not always the case. There is a lot more to our business than just selling homes.

***************************

Being a straight forward professional...I would advise you to work with a Realtor.
Web Reference: http://www.roodycasseus.com
0 votes Thank Flag Link Fri Sep 19, 2008
based on my experiences as a Real Estate attorney, once you find the apt you want and your offer is accepted, I don't know what the broker would bring to the table.

~~~~~~~~~~~~~~~~~~~~~~~

HAHAHAHAHAHAHAHA. Sorry.
Once the offer is accepted the work begins.
0 votes Thank Flag Link Fri Sep 19, 2008
Some times the listing agent will lower his commission in absence of a selling agent, sometimes not. I personally put a clause in my listing agreement stating that I will lower my commission by 1 percent if selling agent is not involved (and I offer 2 percent to selling agent). This is part of my listing presentation. I promise the seller that most likely I will sell the property myself and he will have to pay a reduced commission. BUT: you, as a buyer, will never find out if commission was lowered or not due to the absense of the selling broker. :) No one would tell you this :).

Now about your question whether to bring your own buyer's agent or not. Yes, you can get certain type of assistance from the buyer's agent that would never be provided by the listing agent. BUT: if you already saw the property with the listing agent and even made an offer to a listing agent - there is no way this listing agent will split commission with a buyer's agent brought by you at this point. Most firms follow this rule. Only agent that was a "procuring cause" of the transaction is entitled to commission. An agent brought by the buyer after the property was shown to the buyer by the listing agent - is not a procuring cause. No listing agent in their sane mind will split commission with another agent who showed up after the deal was half-way through.

At the time of the first "substantial contact" with the listing agent, he/she must have given you the paper to sign stating that you agree to be represented by them.

If you still want to have a buyer's agent, you will have to pay him out of your pocket. I don't think it's necessary.
Web Reference: http://housebrooklyn.com
0 votes Thank Flag Link Fri Sep 19, 2008
Todd,

Sarah makes some good points but one thing that must be kept in mind, finding a home and getting an accepted offer are just the beginning. The Realtors are often the glue that keeps the deal together. Sounds like Sarah had a competent listing agent helping her, not working for her. While Daniel says there is no need for a buyer's agent after the offer is accepted, I beg to differ. I have had attorney's and mortgage companies drop the ball. A competent buyers agent will ensure that all the steps are proceeding in a timely fashion and act as liasion between parties. There is also an intangible value to the "hand holding" services, particularly for a first time home buyer, that their buyer agent provides. Remember, the seller's agent only owes the customer honesty, accounting, reasonable skill and disclosure.

When I began my career in 1979, there was no such thing as a buyer's agent. Everyone worked for the seller and commissions were split between cooperating brokers at an agreed upon percentage. The State felt this left the buyer without representation, naked and alone, if you will; so they created Buyer Agency. Whether or not there is value to Buyer Agency is ultimately up to the public to decide.
0 votes Thank Flag Link Fri Sep 19, 2008
If you have already located a property then the buyers broker is not terribly helpful. If you already have a contract you are past the point that you could add a broker into the deal anyway.

You should know that some brokers will lower their commission if they are not forced to split it. This may induce the seller to accept an offer that is less than ask since the broker is taking a smaller chunk.

When I bought my apartment I did not have a broker and the sellers broker acted on both our behalves. Though a broker is trying to get the most money for their sellers they are also trying to get the sale made as quickly as possible. This is true if there are two brokers in the equation or just one (There is a great expination for this in the book Freakanomics if you are interested). After the contract was signed the broker helped me compile my co-op board package and was helpful with the application process. When I sold that apartment when offers would come in without an accompanying buyers broker, my selling broker would lower his fee so that I could get closer to the take away that I was looking for in the sale. In the end the buyer did have a broker, but as my broker was familiar with the building he was much more helpful to the buyer than the buyer's own broker was. Once again I saw that a buyers broker is really only helpful in finding a place and not in the closing on the apartment (particularly for co-ops since there is an application process)

Hope you found a great apartment!
0 votes Thank Flag Link Fri Sep 19, 2008
FIrst off, I am not a realtor so I have no interest in whether you do get a Buyers agent or not. However, based on my experiences as a Real Estate attorney, once you find the apt you want and your offer is accepted, I don't know what the broker would bring to the table. In other words, I'm not aware of what "interests" of yours they are representing. Once you make an offer thats accepted, you choose an attorney who revises the Contract to legally and financially protect you. Thereafter, if this is anything buy a co-op, you hire a title agency which ensures that you receive good title free from any defects. When you apply for a mortgage, your mortgage broker (who, by the way, you should shop around for) should be able to explain all the details of your mortgage/payments/etc. When you get to the closing, your attorney will be there to once again answer any questions you have (she/he should also answer those questions throughout the entire process.) Then you get your keys. I don't know where the buyers agent fits in here. Again this would change completely if you didn't know which place you wanted, were looking around an area, or an offer wasn't accepted yet. At that point you should likely get a realtor to help you out. But, if you ask me, the largest role which is played in such a situation is finding a place, and then finding out everything there is to know about the place. If you've done both, then I'm not sure which interests of yours arent protected even if you're going solo. Having said that, if it doesn't cost you anything, then it wont really matter either way.
0 votes Thank Flag Link Mon Sep 15, 2008
It will not make a difference. The seller has contracted to pay a commission to the listing agent with or without another agent involved.

Do yourself a favor, get a REaltor to represent your interests.
Web Reference: http://GailGladstone.com
0 votes Thank Flag Link Mon Sep 15, 2008
Todd,

Bringing in your buyer's agent will ensure that your interests are being protected. Remember, the listing agent works for the seller. The seller listed the apartment with a real estate company for a specified commission. The listing company then offers a part of that compensation to other companies. Whether or not the listing agent will negotiate the commission in the absence of a buyer agent is at the discretion of the listing company. I, for one, would not.
0 votes Thank Flag Link Mon Sep 15, 2008
The total commission the seller pays is not affected if there are 2 realtors involved, that fee is 1/2 of the listing brokers commission in most cases. by all means you will want someoen to look out for you and guide you through each step. good luck Todd.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Mon Sep 15, 2008
The ERS contract is written to include the co-broker commission and is payable to the listing agent, even if you do or don't have a Buyers Agent. All you lose is representation with no monatary gain. Get you Self a Buyers Agent.
Web Reference: http://Paulmvpteam.com
0 votes Thank Flag Link Mon Sep 15, 2008
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