3 Reasons You Need a Buyer's Agent

Even prior to the National Association of REALTORs settlement, I frequently ran into people who thought that not using a buyer’s agent was to their advantage. This is not true, and in this article, I’ll give you three reasons why.

“It’s too expensive”

The goal of a great buyer’s agent is to provide exceptional service that you do not have to pay for. How? It’s simple - bake the commission into the offer and have the sellers pay for it. Even post-NAR settlement this has been the case. 

A great buyer’s agent structures deals in a way that you don’t have to pay anything for it. Personally, my hit rate on this is in the high 90%, and when we can’t achieve this, we have rolled whatever the buyer’s responsibility is into their mortgage or found another creative way to accommodate. 

Therefore, the cost to you is usually free, and if it’s not free, it is much less than you would think. A great buyer’s agent gets you into the home of your dreams at the best possible price and terms. That is invaluable in and of itself. 

“My offer will be more compelling if I don’t use an agent”

You know who the offer is more compelling for? The listing agent. Not the actual seller, who mind you, is the one who is actually making the decision about which offer to accept.

I understand why a buyer would think that not using an agent would make their offer stand out more. They think that this means the seller won’t have to pay commission to a buyer’s agent. 

What they don’t realize is that in any listing contract, the listing agent is setting a commission and a split. The split is the portion that will go to the listing agent plus the amount set aside for a buyer's agent who brings the buyer. 

If there’s no buyer’s agent in an offer, then guess who brought the buyer? 

The listing agent.

Therefore, they are going to be able to “double end” the commission. 

So, not only are you not saving the seller any money and not making your offer any more competitive, you are:

• Putting more money in the listing agent’s pocket

• Putting yourself at an extreme disadvantage by trying to represent yourself against a professional listing agent

Needless to say, putting yourself at a disadvantage when trying to land what is likely the most important financial decision of your life is not a good idea. 

“I don’t need one” 

Let’s run a quick thought experiment. Think about your job. Now, imagine just anyone thinking that they could do your job just as good as you, with no training and no experience. Beyond this being insulting, it severely discredits your skills, talents, and experience. 

Let’s use some examples for our thought experiment, starting with something very specialized like plumbing. 

No one thinks they could fix a plumbing issue without any training or experience. If someone was forced to fix a plumbing problem with no training and no experience, the consequences would be disastrous. There’d be water, or worse, sewage everywhere and cause thousands of dollars worth of damage. 

Now let’s take something less obvious. Let’s consider an admin or secretarial job. Maybe you work in a medical office and are responsible for booking appointments and keeping records. If you were to do this job with no training and no experience, it’s possible you could mess up appointment setting - to the detriment of the health of your patients and the reputation of your office. 

Or maybe you mess up record keeping and expose the personal information of a client, resulting in a hefty lawsuit against your practice. 

Even though the job may not require as much training and experience as a plumber, the mistakes are just as obvious and costly when you think about it. 

Now back to real estate agents - unlike the two previous examples, the costs of getting it wrong by buying your home without a real estate agent are not as visible, but are no less costly. 

You can’t readily see the consequences of not using an agent. You can’t see the home that you didn’t get an offer accepted on. You can’t see what an alternative, winning offer would have looked like. You don’t know if it was just because of the price you offered, or how you structured the terms. Maybe you wrote the offer completely incorrectly. 

If you did get your offer accepted, you don’t see all the potential money you’re leaving on the table. Maybe you way overpaid because you don’t know the market inside and out. Maybe you failed to negotiate certain critical terms that could have saved you thousands of dollars. 

The opportunity cost and consequences are not visible like they are in other fields, but that does not make them less serious or less costly. 

I wouldn’t recommend being your own real estate agent any more than I’d recommend being your own plumber. 

Conclusion

Hopefully this article made it abundantly clear that you have nothing to lose and everything to gain by using a competent buyer’s agent when you look to purchase your next home. 

The right buyer’s agent gets you into your dream home for the best price and terms possible, and does so usually at no cost to you. The money they save and the value they add is well worth any price you’d ultimately pay if it is not free to you. 

Real estate transactions are among the most important financial decisions you’ll ever make in your life. The average person will make them 3-4 times total. A great buyer’s agent works with buyers every single day. 

That level of experience, and the “cost” to the customer, make it a no brainer.