Why Use Buyer’s Agent for Your Real Estate Purchase?

I pulled this article off Inman as an FYI for my seller’s and buyer’s. Utah, including St. George, allows dual agency: which means one agent represents both seller and buyer.┬áHomes sell at a greater discount from their listing price when the same agent represents both the buyer and seller as a “dual agent,” according to an analysis of 230,000 home sales in 22 markets around the country by technology-based real estate brokerage Redfin.

In the markets analyzed by Redfin, homes sold at an average of 95.6 percent of the list price when both buyer and seller were represented by a dual agent. That compares with a sale-to-list ratio of 97.2 percent for homes in which the buyer and seller had their own agents.

For a $300,000 house, that 1.6 percent difference would cost a seller $4,800, Redfin CEO Glenn Kelman said in reporting the results on the company’s blog.

One agent represented both the buyer and seller in 24 percent of the transactions analyzed by Redfin. The prevalence of dual agency varied enormously across the 22 markets in nine states analyzed — from a low of 5.2 percent in Travis County, Texas, to a high of 59.2 percent in Baltimore County, Md.

Statistics provided to Inman News by multiple listing services in several major markets suggest that over time, brokers and agents have been double-ending fewer deals in the aftermath of the housing boom — perhaps because of the legal liabilities associated with the practice.

Kelman acknowledged that sellers who agree to be represented by a dual agent may be able to negotiate a lower commission. But he argued that even if sellers are able to negotiate a good price, they will need their agent to continue to represent them beyond initial negotiations.

“If your agent also has a relationship with the buyer, and a stake in your working with that buyer over others, it becomes harder for the agent to function as an impartial guide to the deal best for you,” Kelman said. “It may be harder for you to feel like someone’s really watching out for you and you alone.”

The analysis showed that while banks selling real estate owned (REO) properties were less likely to be represented by dual agents, they were just as likely to get less than their asking prices as consumers when they allowed it to happen, Kelman said.

Redfin, which primarily represents buyers, does not allow dual agency or other forms of double-ending, Kelman said.

Thank you and please remember to call me for all your St. George Utah real estate needs. I encourage comparison. Let me show why working with me makes the difference!

2 thoughts on “Why Use Buyer’s Agent for Your Real Estate Purchase?

  1. James McCarty

    Hello Walter,
    This information is somewhat surprising. It is actually counter-intuitive. One would naturally think that having an agent that is dedicated ONLY to the buyer, and having no connection with the seller, would end up being an advantage for the buyer. It is a “conflict of interests” sort of scenario. However, perhaps I have misunderstood your article.

    I am currently considering properties in St. George, Utah and hope to relocate there soon from southern California. I drove over to St. George earlier this week and spent Tuesday and Wednesday speaking to some agents and looking at properties, primarily mobile home properties in Cherokee Springs, Winter Haven and Twin Lakes. I wanted to get a “feel” for what the properties look like in person and their pricing, etc.

    Having done that, I now feel I may perhaps be happier in a Condo or Townhome situation, and would prefer a 55+ community, though it is not completely essential. I plan to drive over to St. George again this coming week and will likely spend Tuesday through Thursday there.

    I have found that looking for a property also includes looking for the right agent. I want an agent who knows the properties, knows the city, and will be dedicated to my interests in obtaining the best possible buyer’s price. Perhaps you can understand my needs and hopes for my relocation project.

    Thanks for your kind assistance.

    Sincerely,
    James McCarty

    Reply
    1. Walter Crovo Post author

      Thank you for your feedback James. The numbers support having your own agent representing you alone. Occasionally there may ben a savings but do we really know the backstory of facts and issues after the sale??? That dual or limited agency may have caused??? With that being said limited agency is not all bad. There are times when it works in everyone’s favor!

      Reply

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