Posted by Michael Hughes February 9, 2010
Reasons for an Investor to have a Buyer’s Agent:
- That the Buyers Agent is to look out for your best interest (They are legally bound to do so).
- There is no money savings by using the listing agent as they become (in Colorado) a Transaction Broker only working for the deal not for the buyer or the investor on your behalf.
- You agree to allow your consultant to be paid a pre-determined finder’s fee from the seller from whom you decide to buy.
- That the consultant will help you find the best deal. Performance based compensation. If they don’t find you what you want…they don’t get paid.
- You agree to work exclusively with that consultant. (This helps ensure that there is no pressure on you to buy because that consultant knows that he / she will eventually be rewarded for their effort to help you).
- You agree to only buy from sellers that will pay your sales person a finder’s fee.
Buyer’s Agents offer Many Services:
Reliable advice and information is perhaps the key factor in making a “good decision”. As your buyer agent, they will provide you info such as, but not necessarily limited to the following:
- The original purchase price of the house. The Starting price, how long on the market,etc
- Evaluating improvements that the sellers may have made to the house and how those figure in to the price
- Comparative market analysis for similar houses in the neighborhood. Active, Expired and recently Sold.
- The average closing concessions paid by sellers of other similar houses in the neighborhood.
- The average drop from list price to sold price and in what time frame.
- How many days the property has been on the market for sale.
- A velocity pricing of supply and demand for this type of property in this price bandwidth.
- Best time of year to buy the property (if any)
- Computerized what if scenarios on spreadsheets to allow you to make sound financial decisions.
- Introduction to reliable mortgage lenders, home inspectors, settlement attorneys etc.
- Let the buyer’s agent worry about finding the perfect house – and they will help you take care of all the small details.
How Exactly Does a Real Estate Investors Buyer’s Agent Get Compensated?
Buyers agents are compensated by the seller of the property. The listing agent will have made a commission arrangement with the seller for a set amount and the listing agent will offer a co-op fee for the buyer’s agent. This is paid by the seller. People who do not wish to pay co-op fees are sometimes FSBO’s (notorious for pricing too high), unscrupulous builders and people that are underwater with their mortgage. Always work with a reputable investor buyer’s agent. It pays in the long run.
To read the entire article Investors: Why you should use a Buyer’s Agent By Rob Barney.
If you have questions regarding this article or Boulder Real Estate please call me 303-359-6627 or e-mail Michael Hughes at Fuller Sotheby’s International Realty in Boulder, CO
