Why Today’s Homebuyer Needs a Real Estate Agent More Than Ever

Last summer I got an email from a local real estate attorney who wanted to buy a house. He’d just gotten engaged and wanted to save some money by representing himself.

This attorney wanted to do all the work an agent would do to find and buy his first home, and get paid a commission for his work. I explained to him that the commission is payable to the listing agent who agrees to pay a portion of it to the Realtor representing a buyer.

Usually, if there’s no buyer’s agent, the seller’s agent gets the entire commission. Some agents will accept a reduced commission for representing both parties. The seller saves some money that way. Sometimes the savings get passed along to the buyer.

I get several emails each year from homebuyers, usually first-timers, who want to know how they can get a real estate license so they can save money on the purchase of a home. They find me through my blog, and apparently decide that I am too scary to work with, but not so scary that they can’t ask me a question or two.

I always let them know that they do not need a license to buy a home, and that they do not need a real estate agent. After I explain to them how to get a license — and that they have to work through a broker, who generally gets a percentage of each commission — they start to let go of their dream of being paid to find their own home.

The buyers who want to do this are usually planning on buying a home that costs $300,000 or more — higher than average for a first-time homebuyer in this market — and planning on saving at least $9,000 by doing the work themselves.

– See more at: http://www.inman.com/2013/12/12/why-todays-homebuyer-needs-a-real-estate-agent-more-than-ever/#!

Last summer I got an email from a local real estate attorney who wanted to buy a house. He’d just gotten engaged and wanted to save some money by representing himself.

This attorney wanted to do all the work an agent would do to find and buy his first home, and get paid a commission for his work. I explained to him that the commission is payable to the listing agent who agrees to pay a portion of it to the Realtor representing a buyer.

Usually, if there’s no buyer’s agent, the seller’s agent gets the entire commission. Some agents will accept a reduced commission for representing both parties. The seller saves some money that way. Sometimes the savings get passed along to the buyer.

I get several emails each year from homebuyers, usually first-timers, who want to know how they can get a real estate license so they can save money on the purchase of a home. They find me through my blog, and apparently decide that I am too scary to work with, but not so scary that they can’t ask me a question or two.

I always let them know that they do not need a license to buy a home, and that they do not need a real estate agent. After I explain to them how to get a license — and that they have to work through a broker, who generally gets a percentage of each commission — they start to let go of their dream of being paid to find their own home.

The buyers who want to do this are usually planning on buying a home that costs $300,000 or more — higher than average for a first-time homebuyer in this market — and planning on saving at least $9,000 by doing the work themselves.

– See more at: http://www.inman.com/2013/12/12/why-todays-homebuyer-needs-a-real-estate-agent-more-than-ever/#!

by Theresa Boardman

Last summer I got an email from a local real estate attorney who wanted to buy a house. He’d just gotten engaged and wanted to save some money by representing himself.

This attorney wanted to do all the work an agent would do to find and buy his first home, and get paid a commission for his work. I explained to him that the commission is payable to the listing agent who agrees to pay a portion of it to the Realtor representing a buyer.

Usually, if there’s no buyer’s agent, the seller’s agent gets the entire commission. Some agents will accept a reduced commission for representing both parties. The seller saves some money that way. Sometimes the savings get passed along to the buyer.

I get several emails each year from homebuyers, usually first-timers, who want to know how they can get a real estate license so they can save money on the purchase of a home. They find me through my blog, and apparently decide that I am too scary to work with, but not so scary that they can’t ask me a question or two.

I always let them know that they do not need a license to buy a home, and that they do not need a real estate agent. After I explain to them how to get a license — and that they have to work through a broker, who generally gets a percentage of each commission — they start to let go of their dream of being paid to find their own home.

The buyers who want to do this are usually planning on buying a home that costs $300,000 or more — higher than average for a first-time homebuyer in this market — and planning on saving at least $9,000 by doing the work themselves.

I decided that helping the attorney would be an excellent learning experience for me. So I agreed to help him buy a house without a real estate agent if he would share his experiences with me so that I could learn how to better help my buyers and sellers

 

He started his search for a home the next weekend. I advised him on how to ask for a price reduction, or have the seller pay closing costs, equal to roughly what the listing broker was expecting to pay out to a cooperating broker bringing a buyer to a sale.

I told him not to use the contracts that lawyers use, but to use the contracts that real estate agents use. I advised him to write the price reduction into the contract, and explained to him that agents do not have to cut their commissions.

If I were representing a seller who got such an offer from an unrepresented buyer, I told him, I would certainly consider cutting my commission — and I suspect I would get a little pressure from my sellers to do so.

The following Monday, he emailed the wording of the first offer he planned to submit.

I made several suggestions on how to make the offer better and more competitive, so that he would have a chance in a multiple-offer situation. We shortened the inspection period and removed some additional contingencies he had put into the offer that were unnecessary.

He wrote offers on five houses where he was competing in multiple-offer situations. None was accepted. Most buyers would have given up even if they had been working with an agent. But this guy was on a mission.

There were no other offers on the home he finally bought. He spent many, many hours looking at houses, doing research and juggling appointments with listing agents.

When he was done, he told me that if he did not love real estate and have a passion for it, he never would have had the patience or taken the time to work without an agent. He could have made more money than he saved, he said, if all the hours he’d spent searching for and negotiating a home purchase had instead been spent working his job as a lawyer, generating billable hours for clients.

One of the biggest challenges he had was scheduling appointments to see the houses, and seeing the home before someone made an offer. He found some of the real estate agents to be helpful. Others clearly did not know what they were doing, and that made it harder for him to buy the house.

The house he ended up with was overpriced and, as a result, did not get any other offers. He was able to buy the house for slightly less than market value.

When I complimented him on his negotiating skills, he told me why the seller accepted his offer. It came down to the buyer being in the right place at the right time. But he also did his homework, and knew the approximate value of the house.

He saw that it was overpriced, and was not afraid to make an offer that was significantly less than asking. It is often very difficult to convince buyers to make a fair offer that is significantly below the asking price.

This lawyer got no advice from me on how much to offer, which houses to make offers on, or which ones to look at. But I did tell him which websites have the most accurate information, and the greatest number of homes that are really for sale.

I gave him a little guidance on strategy, business practices and how to use Minnesota real estate contracts. He tended to write offers without considering the seller at all. I encouraged him to get as much help from his lender as he could.

I think it was easier for buyers to represent themselves when it was a buyer’s market. Multiple-offer situations are very common today, and he lost every time he competed in such a situation. Today’s buyer often has to compete with experienced agents, and may be at a disadvantage.

Just this week I got an email from a buyer who wants to save money by working alone instead of with a real estate agent. He started this endeavor by asking me, a real estate agent, questions. So I know we still have some credibility.

First-time buyers, in particular, seem to feel as though we get paid way more than we should, and some are not so sure we are worth it. I advised him that if he does not want to work with agents he should also consider approaching homeowners who are not working with agents.

Earlier this week I went to a closing for a buyer who had purchased his ninth home and would not even consider doing it without an agent.

He asked for my advice every step of the way, and made it clear upfront that he was looking for an agent who has more experience than he does.

That is what my clients are paying for. And that’s all the attorney who wanted to do the agent’s work himself needed from me, too.

Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.

If you are looking for experienced real estate brokers in the Seattle and Greater Puget Sound area, give us a call, we would love to guide you through your home purchase.

-Steve and Sandra

Steve Hill and Sandra Brenner
Windermere Real Estate/FN
Seattle-Northwest
122502 Greenwood Ave N
Seattle WA 98133
call/text: 206-769-9577
email: stevehill@windermere.com

Check out these useful Home Search Apps:

Windermere for iPad
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Check out these useful links:

BrennerHill.com
Best In Client Satisfaction
Seattle Real Estate Statistics
Windermere Housing Trends Newsletter

Our Preferred Lenders

George Runnels
Washington First Mortgage
WaFirstMortgage.com
call/text: 206-604-4545

Jackie Murphy
Cobalt Mortgage
CobaltMortgage.com
call/text: 425-260-6834

 

Posted on December 17, 2013 at 6:00 pm
Steve Hill | Category: Home Purchase | Tagged , , , , , , , , , ,

Tips for Buying a Home in the Fall

So, you're finally off the fence and ready to buy a home before prices — and mortgage rates — rise any further. Here's what you need to know about jumping into the market at this time of year.

Selection is limited

Many frustrated sellers who weren't able to unload their properties during the busy peak spring/summer buying season may take their homes off the market, particularly as the holidays approach and the action comes to a screeching halt. This means you can expect the selection to be even more limited than it currently

There's room to negotiate

Was there a home you saw and loved a few months ago? Is it still on the market? If it hasn't sold after one of the hottest real estate summers since the economic downturn, you likely have room to negotiate. While some buyers will pull their homes off the market, others who have been holding out for the best possible price may now be ready to come down. While some homeowners are determined to get a set price, others may simply want out at this juncture.

Check maintenance areas

Fall is the ideal time to check things such as gutter drainage and the general upkeep of the yard. How does everything look? Does anything need repair? Visit the home on a rainy day and see for yourself. Then go inside and check out the furnace, looking for drafts, leakage issues and other possible structural/maintenance problems. If they're apparent, determine how much money it's going to take to get everything up to snuff and factor that into your offer, adjusting your price accordingly.

Looking for a broker to help you find your new home this Fall? Give us a call, text or email, we would love to help you find the perfect home!

-Steve and Sandra

Steve Hill and Sandra Brenner
Windermere Real Estate/FN
122502 Greenwood Ave N
Seattle WA 98133
call/text: 206-769-9577
email: stevehill@windermere.com

Check out these useful links:

BrennerHill.com
Best In Client Satisfaction
Windermere Housing Trends Newsletter

Our Preferred Lenders

George Runnels
Washington First Mortgage
WaFirstMortgage.com
call/text: 206-604-4545

Jackie Murphy
Cobalt Mortgage
CobaltMortgage.com
call/text: 425-260-6834

 

Posted on November 5, 2013 at 3:01 pm
Steve Hill | Category: Home Purchase | Tagged , , , , , , ,

Now Is The Time To BUY!

Considering A Home Purchase?
Let our experience save you time and money!

Steve Hill and Sandra Brenner
Windermere Real Estate Seattle Northwest
206-769-9577

Posted on June 4, 2013 at 8:01 pm
Steve Hill | Category: Home Purchase | Tagged , , , , ,

When To Buy a House? RIGHT NOW!

traffic lightsAfter witnessing the housing bubble ‘pop’ just a few years ago, many would be buyers may be hesitant to pull the trigger. Today, we want to explain that the greatest risk a buyer can take right now is actually waiting to buy a home.

We realize that every purchaser wants to be able to get the best deal. They want a great price and the lowest mortgage interest rate possible because those to items together will determine the monthly cost their family will pay. Let’s look at each one:

Are home prices rising?

Just last week, the Case Shiller Pricing Index was released. The index revealed that U.S. home prices increased by 10.2% over the last twelve months. Last month, theHome Price Expectation Survey was released predicting that home values would increase by at least an additional 3.5% for each of the next five years.

If you were waiting for the absolute bottom of the home price declines, you already missed it.

Are interest rates rising?

According to Freddie Mac’s Weekly Primary Mortgage Market Survey, the 30 year mortgage rate shot up to 3.81% last week – the highest level in over a year. This is an increase of a half of a percentage point in the last six months. And the Mortgage Bankers AssociationFannie Mae and the National Association of Realtors all predict that rates will continue rise over the next eighteen months.

Conclusion

If the right thing for you and your family is to purchase a home this year, buying sooner rather than later could lead to substantial savings.

Considering Buying?
Give us a call and let our experience save you time and money.

Steve Hill and Sandra Brenner
Windermere Real Estate Seattle Northwest
206-769-9577

Posted on June 3, 2013 at 1:45 pm
Steve Hill | Category: Home Purchase | Tagged , , , , , , ,

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