Question Details

Carol Andres…,  in Pittsburgh, PA

Have you encountered buyers of new construction who feel that a buyer's agent isn't necessary?

Asked by Carol Andres Baer, Realtor®, Pittsburgh, PA Mon Feb 4, 2008

Please tell me what you say to them.

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Hello Mikem, I have encountered buyers of new construction who feel that a buyer's agent isn't necessary. Most buyers these days are pretty knowledgable. In new construction we are still obligated to complete the agency relationship disclosure. We are still obligated to convey any disclosures and most of us take our business serious and would not deceive any buyer. Integraty in this business is everything. But in any case the buyer's agent does only fill out a referral form and aside from moral support and advice don't have any dealings with the seller or the sellers contract. We are all Real Estate Agents or Brokers as well. Don't get me wrong your Business to a new home community is welcomed and appreciated but not necessary.
0 votes Thank Flag Link Tue Feb 5, 2008
Ah sorry, misread your question.

A fact sheet would be good in that situation, along with an explanation of how hiring a buyer's agent works. A lot of people just don't know how things work, and are under many misconceptions.

So, I'd say explain to them how things work, and ask them why they wouldn't want an agent representing them. You'll still lose some buyers, many of which like your relatives will realize they could/should've went with an agent, after they close.
0 votes Thank Flag Link Tue Feb 5, 2008
Thank you Mikem. I should elaborate on my question . . .

I agree that in the past the access to MLS was a big issue for buyers.

I have been a buyer's agent on many new construction purchases. However, over the years, I have talked with many homeowners who claim they had no idea that the site rep was representing the builder ONLY, and they also claim they had no idea that bringing in their own agent was even an option. On the occasions where I attempted to explain the need for their own agent, I was met with complete disbelief that any agents were involved and that the site rep was nothing more than a customer service rep.

One example, specifically . . . my relatives built a house out of state a few years ago and I asked if I could refer a buyer's agent to represent them. They responded that there was no need because this was a situation where there were no agents involved. I persisted that they needed representation, but their response was that "things are different here in this state, and they don't use agents for this new construction, and there isn't any negotiating ability and we wouldn't feel comfortable rocking the boat since we've already visited the construction site."

These same relatives admitted to me (after their closing) that they were shocked and embarrassed to learn that the listing agent collected a double commission and that they were sorry they didn't allow me to refer a buyer's agent.

I'm putting together a fact sheet to give to buyers because this isn't the first time this has happened to someone I know. I'd like to hear everyone's input and/or stories of how they've handled similar situations.
0 votes Thank Flag Link Tue Feb 5, 2008
Ask them why they feel buyer's agents are not necessary. Most likely it will be somethign along the lines of "because we can search properties on our own" It's up to you to explain to them that there are more to buying a house than looking at properties on some web site, and also explain to them what services you offer and how those services will benefit them.

A quick explanation of how buyer's agent commissions work wouldn't hurt. (ie. listing agent usually offering a compensation to buyer's agent)

In the past, one of the main reasons to hire a buyer's agent was the fact agent had access to mls and buyer's did not. One of the main (as far as buyers are concerned) reasons to hire an agent in the past was for that agent to search properties to find what buyer wanted. Today that role is nearly obsolete. If people want to search properties and find one they like, they don't need an agent to do that (in fact, many prefer to do it on their own so they don't have to deal with preasure to buy from an agent)

So, focus on, and explain to buyers what else having a buyer's agent would get them, like your negotiating skills, your experience and advise etc etc.

Too many agents are working with the past model of "just sign here and we'll look at the properties that match tour criteria" Many buyer's are well aware of sites offering property searches, they don't need you for that. If you make it seem like the main reason to hire you is your ability to help them search properties, then it's obvious buyers will feel that they don't need you.
0 votes Thank Flag Link Mon Feb 4, 2008
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