For as long as we have been selling real estate, a small subsection of the buyer’s pool (currently around 10%) believes that working without a buyers agent representing you is an advantage. It’s not. Here’s why:
- Have Someone Looking Out for Your Financial Best Interests:
If you deal directly with the listing agent and are unrepresented, it is important to remember the listing agent has a fiduciary responsibility solely to the seller. They only must represent the seller’s best interest, not yours. This is true, regardless of how nice they are. The listing agent can never put your financial interested (getting the best price) above the sellers (getting the most money). This is not something that should be overlooked.
- See beyond the Sale Price:
Having access to the data that StreetEasy provides does not make one an expert on the complicated and often opaque NYC market. Knowing that the apartment that just closed on the 5th floor was a distressed seller who was in the middle of getting a divorce or if you are a first-time buyer, having a veteran broker educate you on the buying process, from mortgages to bidding wars, is priceless. This is information that a listing agent is not likely to divulge.
- Working with a Buyers Agent is More Efficient:
Have you seen the inventory of homes lately? There are 46 two-bedrooms on the market in Tribeca and 122 on the Upper East Side, just between $2M and $3M. Do you have time to visit them all? A great buyer’s agent who specializes in specific neighborhoods will be able to look at those listings and tell you which 8 to 10 are the best apartments, and get you in to see them before they sell.
- Think You Are Getting a Good Deal? Think Again:
This business is about relationships and knowing that one developer just discounted a similar apartment last month by 8% because we know another buyer who did a deal in the building is the difference between you believing that getting 5% off is the best they can do or getting another $100,000 discount. StreetEasy is a great tool, and the fact that it aggregates most of the NYC listings is beyond helpful. By all means, use it, but when it comes time to get serious about buying, the smart money is using an experienced buyer’s agent.
- You Only Get a Better Deal as a Direct Buyer Under These Circumstances:
The compensation for listing agents is determined well in advance and is agreed to contractually. And so, while the listing agent would love to be able to collect the entire fee and go to Tulum for February, the reality is that it is up to the seller to decide to accept your offer. Here, we come back once again to the concept that the listing agent has a fiduciary duty to the seller to get them the highest price. Dangle double the commission in front of them, and many agents will tell you whatever you need to hear to get to the finish line. That kind of temptation is difficult for some agents to do the right thing.
The only time having no buyer’s agent will benefit you is when you end up in a bidding war, and you are competing against other offers that do have buyer’s brokers. In this situation, if the offers are close, we have seen listing agents reduce their fee to make “their deal” happen. Rare at best and probably morally wrong, but I am still firmly in the camp that believes having a buyer’s agent that can advise you on how much to bid and how to win the bidding war is much more valuable than getting a 1% bump.
- Guide you to Your Dream Home Instead of Blindly Searching.
A buyer’s agent’s role is to help you find what you want by being ten steps ahead of you. What we have found is that most buyers start their search asking for X, Y, and Z and end up buying Q, R, and S. Searching for a home is a process. Having an expert on your side who knows what is out there to guide you and help point you in the right direction is more than just helpful — it can be the difference between getting that gem of an apartment or missing out on one by this much.
- For the Truly Special Properties, You Have to Look Off Market:
For those buyers who are looking for something less common, like a 25′ townhouse on Jane Street, having a seasoned buyer’s agent on your side is also a must. Many times, the great trophy homes trade off-market or, at least, we find out about them before they get listed on the open market. Having someone on your side to go beyond what you see listed on StreetEasy is smart practice.
- Have Someone On Your Side to Dig a Little Deeper:
Also, while the duty of the listing agent, to be honest, goes without saying, they may not be disclosing all of the facts that will help you negotiate the best deal. For example, that corner two-bedroom facing Crosby Street? The same unit is coming on the market three floors higher with a renovated kitchen next month. Having a buyers agent with “juice” is always a good idea.
- Loyal and Patient:
A right buyer’s broker is looking to build a relationship. It doesn’t matter if you buy next month or in two years; a good broker will want to make you happy and work hard for you without any pressure.
- Win Your Bidding War:
Speaking of bidding wars, how many have you been through? We have been involved in at least 50 and will give you the benefit of everything we have learned throughout those deals. Sometimes, it seems like more of an issue of a particular type of buyer who has purchased before, believing that they know the market and can negotiate for themselves a better deal. Rarely is this a fact.
- Will I Be Able to Resell it Easily 8 Years From Now?
It’s good to have a resale broker by your side to tell you what kind of properties are easier to resell than the others, which will play a role in what you decide to buy.
- Thinking About Purchasing in a New Development?
What About Buying in a New Development? Do I Need a Buyer’s Agent Then? The onsite sales team works for the sponsor, and their job is to get the sponsor the highest price. Their fiduciary duty is not to the buyer. Sure, they are knowledgeable and want to make the deal happen
Want to get started and work with a pro? Email us at columbiavitoloteam.com, and let’s get shopping.