This my second post on our experience in Finding A Buyer’s Agent. In Part 1, we tried our best to figure out what we wanted from an agent. Again, we are first-timers and are not real estate gurus. This is a long post, but it definitely shows a real story of how we found our agent – and how she helped us find our house!
Given the hundreds if not thousands of real estate agents in our area, it was going to be a daunting task to find the “perfect” agent. We had to filter them down somehow. After reading up at a couple of books and websites about how to select a buyer’s agent, here’s what we were told:
- Ask trusted friends for recommendations. Ask about the reputation of both the agent and the brokerage house he/she works for.
- Ask potential agents for testimonials and references. A long list of references is good, but it’s unlikely you’ll hear from the unsatisfied folks.
- Check the local real estate board if your agent has any complaints against them. This is pretty unlikely in my experience, they aren’t exactly regulated that closely.
Our First Experience
First, we asked our friends and family for experiences. One of our family members actually used to be an agent, but she retired a while ago. Another family friend volunteered to be our agent, so we decided to try him out. It didn’t work out as he seemed to only want to show us certain houses in certain areas, and wasn’t very responsive to our specific requests. I guess we weren’t the ideal “let’s see 3 houses you recommend and we’ll just buy one of them” couple. Not wanting to mix friendship and business anymore, we decided to find our own agents from then on.
After browsing some newspaper ads, I decided to visit HomeGain.com and used their free “Find a Realtor” feature to compare some agents. You provide your information like neighborhood, price range, etc. and then a bunch of agents try to create a custom “proposal” for you. However, it’s all done online through their interface, and none of your contact info is shared without your permission. I liked the idea of not keeping my name and phone number private. You also get client testimonials and their experience level. Here is a sample (click for full size):
Most of the proposals sounded the same… “I know all about your neighborhood, let me help you etc. etc.” We picked our favorite five, and asked them the same interview questions online:
- How long have they been doing this full-time? We didn’t want any part-timers, or newer agents. Sorry new agents!
- What neighborhoods do they specialize? I wanted an answer that was independent of where we were looking. I suggested that we might be looking in a different neighborhood than I had chosen on the form. If they replied “all of them!” then that got negative points.
- How many houses did they buy or sell within the last year? Can we get some references? (Not just HomeGain clients.) Obviously we wanted someone who was active, but we didn’t want the busiest person either.
- Were you willing to negotiate a commission rebate? I told them that we had MLS access, would be low-maintenance, etc. Besides the money savings, I also just wanted to see their attitude.
The answers we got were pretty standard. Nobody really stood out. But all of them were violently against a commission rebate. One said they had never heard of such a thing (ha!), and another even said it was illegal (true in some states, but not mine!). Another said I was stealing food off their table or something. If you’re going to lie to me, I’m not going to give you my business. Because guess what? HomeGain charges real estate agents to be part of this bidding service. So essentially they are already discounting their commission for extra business.
Considering A Discount Real Estate Broker
I was kind of annoyed at this point, so I considered using an indirect service like Redfin or BuySideRealty, but I decided that I really did want a personal agent. So I decided to go through HungryAgents again since with them you get a “real” agent. I had tried them a few months before on a whim, but never actually followed through with choosing an agent.
The process is similar to HomeGain. The service is free for the buyer, and the agent pays HungryAgents if they close a deal. You put in your basic info, and the agents come back with their years of experience and their rebate percentage. We sent out interview questions again, and decided to try our favorite responder out. We planned to simply see a few homes we were already interested in, and see if we hit it off.
Signing A Exclusive Buyer’s Agent Contract
The first weekend went well and we liked her, so we decided to sign a 30-day exclusive contract with her. This meant we couldn’t switch agents for 30 days, but it also meant that our 50% rebate (1.5% of sales price) was in writing. People had warned us not to sign a contract with a buyer’s agent because then they have less incentive to work hard for you. Well, if that was the case then we’d drop her after 30 days. But we didn’t have to. She was actually very experienced and is now her own Principal broker, which means she doesn’t have to split her commission with Century21 or RE/MAX or whomever. I feel like this is why she can afford to give a rebate – out of the usual 3% most of the time the office gets 1-2% and the actual agent only gets 1%. Or I guess when times are slower she offers her services “on sale”. But we never felt like second-class clients, and she was always very responsive.
Summary and Offer Acceptance
Screening by price may not seem like the best idea, but in this case it helped us narrow down the field drastically. If we ended up getting horrible service, then we could always go back to full-price agents. But things have worked out great. We actually toured less than 10 homes in person with our agent over the last 4-5 months, and made bids on a total of four homes, the last of which was accepted.
We found the final house on MLS, called her to contact the listing agent, got the lockbox number, saw the house hours later, and called in the offer the very same day (first day on market). She never even saw the house until after we were in escrow! But she fulfilled all our expectations, as I don’t know if we would have been able to get in there that fast with RedFin or BuySide since you have schedule visits ahead of time online. I think this has turned out to be a good arrangment for all parties involved.
By Jonathan Ping | Real Estate | 1/24/08, 6:03am