Research Triangle Real Estate

Many real estate agents will try to entice buyers to use them as a buyer's
agent with the claim that they will receive true agent representation and it
will be for free. This is  based on the way commissions are typically paid
out on real estate sales. Commissions to both the listing agent and the agent
working with the buyer are typically shown on the sellers side of the closing
statement, and are paid out the sales price of the property. Does this mean that
the buyer pays nothing toward the expense of the buyer or sellers agent? This is
a debate that rages inside the real estate industry - who pays the commission?
Buyers bring the money, the commission shows on the sellers side, sellers and
listing agents offer a commission to agents representing the buyer and sometimes
offer bonuses to buyers agents, some buyers agents offer rebates - it all seems
very confusing, and is, not only to most consumers, but unfortunately to most
real estate agents as well. One thing that I feel  fairly certain about
though is that rarely do you get anything of value for free, and I don't know of
any real estate agents who do not want to get paid. I also know that true buyer
representation from many agents who make this claim is a myth, as many will slip
into a dual or designated agency role when that suits their main goal of
securing a commission. (For more on types of agency, the NC Real Estate
Commission has a brochure explaining buyer, seller, dual and designated agency).

A trend worth noting here is sellers offering as little as $1 in commission
to the buyer's agent. Current MLS rules say that listings must offer some sort
of compensation to other agents. This is the basis of the MLS - an offer to
cooperate and share compensation. In this area, buyer agent commissions have
typically been 2.4% in the Wake County market area, and 3% in the Durham and
Orange market area. Many agents do not even discuss with buyers what they are or
should be paid, but accept the compensation offered. Are they going to be
willing to accept $1? Are they going to steer buyers away from listings offering
less and toward those offering more? If they do, are they truly representing the
interests of the buyer, who is likely looking for the best property for the best
price? A good agent will have an upfront discussion with buyers they represent
and have an agreement with the buyer as to how and how much they will be paid.
Goddin Real Estate has several
innovative programs for representing buyers which can result in substantial
rebates of part of the buyer agent commission to the buyer. We could claim this
means that we are better than free, we actually pay buyers to represent them. We
could, but we don't, because we know that sellers are far more concerned with
their net proceeds than the sales price of the property, and the less they pay
in commission, the less the buyer has to bring to the closing.

# posted by John Goddin @ 9:11 AM