Details, details! Does your agent tell you everything you need to know or does he/she withhold information that might be essential in the decision making process?
In the following clip, the agent is informing potential buyers that the house in question is “permeated by unspeakable evil.” The clip is absolutely hilarious. Apart from being a brilliant piece of comedy, the segment also brings to mind the potential pitfalls of working with a listing agent when you are buying a house. Watch, laugh, and then I will elaborate.
Perhaps more relevant to most buyers who are purchasing homes that are free from squatters from the great beyond, is whether they know who their agent represents. With the flood of information available to buyers on the internet, many feel empowered to work out deals on their own directly with the listing agent. The information stream, wonderful though it is sometimes creates a false sense of security. In New York State, buyers often work successfully with listing agents who will sometimes offer reduced commissions because they are closing “both sides” of the same transaction. This is called “dual agency” and when it works, it can save both the seller and the buyers some coin, but there are serious drawbacks as far as the buyer is concerned. For the first-time buyer in particular, I consider working directly with listing agents to be particularly chancy. Unfortunately, the Gen Y first time buyer is the type of buyer who is most likely to think that they can “do it themselves” and that agents are there to merely open a few doors and fill out some forms – and collect a large check. Nothing could be further from the truth. Purchasing a property is far more complex than most people think it is and what you don’t know can hurt you.
The big bugaboo here is that the listing agent represents the seller. I can not emphasize this point enough…so I will say again THE LISTING AGENT REPRESENTS THE SELLER!!! This fact may come back to haunt the buyer later – (no pun intended) because the buyer is essentially unrepresented. There are several points to be made here.
1. The segment depicts an agent trying to sell a particular home to a buyer. She is pushing that home whether or not it suits the specific needs of the buyers. It doesn’t matter that the husband appears to have an issue with the dead clown manifesting himself in the yard or the mass of malevolent energy in the basement – her job is to sell the house in question. This situation is typical for a listing agent who has a fiduciary obligation to the seller. They have no obligation to try and find the best fit for the buyer – indeed such an obligation would be at odds with their legal obligation to the seller.
Although the listing agent owes the buyer fair and honest dealing and is obligated to disclose known flaws with respect to the property, and answer all questions honestly – one should note that the agent didn’t volunteer information on the “evil” permeating the home. Only when pressed with questions and the “manifestation” of the clown did she gradually reveal that the home had issues of a supernatural nature.
2. Since the listing agent represents the seller, they are obliged to get the best deal possible for the seller. That means that the buyer must watch what they say very carefully because any inadvertent comments such as “this is exactly what I’ve been looking for” can and will be used to skew the deal to the seller’s advantage. This is not deception on the part of the agent; it has everything to do with their LEGAL obligation to the seller. This means the buyer has to remain mum with respect to just about EVERYTHING and they can not turn to the agent for advice. This includes financial status, how far they are willing to go in the bidding process – you name it. Any slip-up can cost the buyer serious money.
3. When it comes to negotiating the deal, they buyer needs to realize that they are on their own and that they are negotiating with a pro! Think about this. Agents do this EVERY DAY. We know how to negotiate a deal. We usually know just how far we can push without creating a rift with the other side, we know what can make or break deals. When we are up against fellow agents it’s between two professional negotiators who have enough distance from the deal to remain objective. When a buyer is negotiating with a professional agent – they are more emotionally and financially involved in the outcome – so the stakes are higher for them than the for the agent. Not to mention the fact that few buyers negotiate transactions of this nature on a daily basis. The odds are stacked against buyer coming out with the best possible deal.
Buyers need to think twice about negotiating directly with a listing agent for a home. Sure, it might save a couple of thousand dollars, but is that few thousand dollars worth being unrepresented in the largest financial transaction they will probably be involved in? The old phrase “penny wise and pound foolish” comes to mind. A buyer’s agent does far more than drive people around and unlock doors. Working with a qualified buyer’s agent can help the buyer secure the right home for their needs at the best possible price and terms. They help guide buyer’s through the process from finding the right home to finding the right lender, house inspector, contractors, appraisers, movers, and any other ancillary service you would care to name. When it comes to purchasing property, the devil is in the details.
Please feel free to contact me anytime to request additional information or to set up an appointment so we can explore your listing or purchasing needs. I am easy to reach by phone, text or email. Or, if you just want to continue your search online, the links below will help you get started.