That is because the seller's agent will collect the entire commission on the sale of the Boca Raton home you are thinking about purchasing.
Also, bear in mind that the seller's agent with whom you may be negotiating works for the seller. He or she does not have your best interests at heart. So while that Boca Raton real estate agent may work with you to lower the price by some small amount (which is expected in today's market), that seller's agent is not going to work very hard on that discount.
A buyer's agent, who costs you nothing (because buyer's agents are paid by the seller) works for you, the buyer. It is your buyer's agent's job, and also a point of pride, to help you, the buyer to obtain the best possible price on your new home in Boca Raton.
Is your buyer's agent smarter than you? No. Is your buyer's agent financially savvy? Maybe and maybe not. Is your buying agent more experienced that you in negotiating the price of homes? Probably. But most important, does your buying agent care about the seller's feelings or the seller's agent's feelings? No, because your buyer's agent has no emotional involvement with the house in Boca Raton you are looking at and has no obligation to the seller.
Your buyer's agent, who is working for you, is focused only on making sure you get the best possible price on this house in Boca Raton.
And, if for some reason the deal does not work, your Boca Raton buyer's agent is able to locate several other homes for you, thus saving you the time and effort of calling a couple of dozen seller's agents.
In addition, your buyer's agent saves you time and energy because that agent sorts through listings to make sure you're looking only at homes you want to see, and your agent brings you to five or six homes at your convenience, instead of your having to meet with scores of seller's agents at different times and days of the week.
If you're still looking for homes in Boca Raton, consider using a buyer's agent. He or she can help to make your home buying experience much better that it might be on your own.
Marc Jablon, The Jablon Team
It has nothing to do with your negotiating skills or financial savvy. It has to do with preestablished terms and conditions. Here's how it works:
When someone wants to sell a property, he/she lists it with an agent (the "listing agent"). At that time, the seller agrees to pay x% commission. Generally, the seller agrees that if a second agent (a "buyer's agent") is involved, that the commission will be split among the two agents.
But the important point to remember is that the seller has agreed to pay x% commission whether or not a second agent is involved. If it's only the listing agent, the listing agent gets the full commission (which often then has to be shared with the agent's broker).
So you come in later without a buyer's agent. Unfortunately (for you), that's not saving the seller a penny. The seller has already agreed to pay x%. So you're negotiating from a position of absolute weakness. You have nothing to offer the seller.
The only exception is IF the seller, in the listing agreement, has specified that if the buyer lacks an agent, then the total commission is reduced. That could be included, but very seldom is.
Your question reflects a common misconception, and seems to be the reason why many buyers make offers through the listing agent.
To get a better deal, negotiate on price, terms, and conditions. There are lots of variables, lots of different things you can offer in return for a lower price. Not to sound like a sales pitch, but a good buyer's agent can help you with that strategy.
Hope that helps.
I'll be brief and to the point. You handle corporate negotiations, so in other words, you represent an entity buying/selling/trading/renegotiating etc... They come to you for representation and I'm sure pay well for your knowledge and expertise. Being that this is what you do, why would you sell yourself short on your own personal representation when purchasing real estate by not having representation?
You may have been involved in RE transactions in the past but this is a completely different market. You need a professional who is aware of all the constant amended laws and regulations and someone who will protect your interests to the max. Is a price reduction now, worth you having to possibly come out of pocket later? Also keep in mind, if you misrepresent yourself, the only person you can hold liable is yourself.
And Marc is correct, you can waive the representation of an agent or refuse dual agency from the listing agent, but in the end he/she most likely will still get the full commission from the seller. It's actually an even sweeter deal for the listing agent if you refuse dual agency because he/she is now getting paid double commission for half the liability.
Please don't misinterpret this response, I'm just being as straight-forward as possible with you.
Best of luck.
There are only two people that can reduce the purchase price. The two principals buyer and the seller.
The agent is only an instrument and is working on behalf of his client. On his own he is incapable to do anything without permission of his principal and without a signed document authorizing it.
Agents that claim otherwise are not playing by the rules.
Remember realtors present all offers t than support the offer to their best abilities. Than shut their mouths and wait for the response.
Does their negotiation skills help in getting their buyer's offer accepted ? Confidence is strengthened by knowledge. A Realtor that is forceful and manipulative usually looses the first round and eats humble pie.
Sometimes being kicked out of the house and told never to return when the buyer's offer gets rejected.
But a soft spoken realtor polite and full of empathy returns to the negotiation table and is successful in putting the contract back on track and getting a counter offer.
So in essence negotiation creates the potential for buyer and seller to agree.
Reducing the price and accepting it becomes the final decision of all parties concerned.
Perhaps you were wondering as all negotiations fail and there is no hope for the deal to be made the realtor may offer to reduce his commission just to break the ice. Does that help? Most of the times.
I see written in quite a few listings that the bank, who is part of the negotiation, will not allow a commission to be paid to an agent buying for themselves. This would be a consideration for you also. It stink to suffer through all the work and then still not get paid for it.
Good Luck! Hope you got answers here that helped.
If you're a licensed agent, representing yourself (the buyer), then you are entitled to your share of the commission. So while you wouldn't be reducing the price of the house, you'd be receiving a commission which would offset a portion of the cost.
Lots of agents do that. Some, however, advise against it, noting that purchasing tends to be emotional, not just factual/logical. Sometimes it helps to have a buffer in the form of your own agent. That's a decision you'd have to make.
Hope that helps.
While we may not have to volume of knowledge/Information of a Law Degree, we do have a lot of things that we need to know, and the amount is growing on a daily basis.
Some people are overwhelmed.
And just like every position, we have had to serve our apprenticeship:
I don't know of anyone who stepped in and was an instant success.
When a Client asks a question; they expect an answer.
Good luck and may God bless
This is especially true when a transaction goes south, as they sometimes do. We have an arsenal of tools at our disposal to right wrongs, mediate disputes, and help you make the right decisions.