Home Sellers Use Caution: Don't List Your Home With A Buyer's Brokerage
In the last few years there has been a change to a buyer's marketplace in Michigan real estate and a lot of the agents who focused on listing homes have gotten involved in working for purchasers as well. This move has brought a number of obvious conflicts of interest that you need to be careful of when you decide on a real estate company to list your home.
If a real estate agent/brokerage lists your home and it sells through another office, each company will typically receive about three percent of the sales price depending on the local marketplace customs. However, if the listing office brings in the purchaser and completes the transaction they typically double their compensation. If they bring in that buyer and direct that purchaser to an allied mortgage firm, their profits may triple because of the profits they generate on the mortgage.
The role of a listing agent should be to get your real estate sold for the highest price and best terms. But if that same company is working as a "buyer's broker" you are likely to get caught in the center of their desire to "double dip" or "triple dip" the sale.
That is a enormous reason for real estate professionals to compromise your interests in the transaction. Just think of the pressure they could put on you to accept an offer from a home purchaser or a request for repairs for a purchaser when it could double or triple their income for just a few minutes of sales pressure on you.
In many markets these agents/real estate companies even promote their ability to save buyers money at your expense.
Here is an idea: Do an world wide web search for the term: savings guarantee real estate home buying
You will see dozens of brokerages who take listings, yet guarantee to purchasers that they will negotiate $5,000, $10,000, even as much as $25,000 off the asking price. How would it cause you feel if you signed a listing contract then found out later the agent/listing broker guaranteed some consumer that they would trim money off your meticulously researched price?
The key to this concern is straight forward. Before you decide on a company/agent to even interview, do an Internet search for their name and "savings guarantee" and/or "buyer services". See who they are really going to be working for. If they seem focused on working for purchasers, find another brokerage. Selling a home and moving is tough enough, you don't need to have difficulties with your real estate firm.
Also, see if their web sites endorse a specific mortgage company. If they have a mortgage affiliate it means that they have an additional motivation that is not in line with getting you the maximum price and best terms for your home.
If they pass those two tests and you end up meeting with them, ask them how often their company represents both the purchaser and the home owner in the same deal. If they perceive your concern they will often respond with something like "it is better for you if we bring in the buyer because then we have more control over that buyer".
Just realize that implies that tomorrow they will be telling a buyer that "it is better for you if you buy one of our listings because we have more control over the seller". And that seller might be you.
If you are able to avoid these brokerages and licensees that claim to be buyer agents you should be able to find a dedicated real estate firm and agent. And that will improve your chances to have a smooth transaction when you put your home on the market
