What is the responsibility of the real estate agent?

[Chris Loh]

Hi BP Forum Members, 

I'm a first time home buyer.  I found a loan officer I really like and he recommended a realtor.  I haven't really had time to speak with the realtor but I was wondering what his responsibility is? To be more exact, can I tell the realtor I'm looking for a property that cashflows $500 if I house hack it and send him to work?  Or do I just send him properties I want to look at?  What should I expect from my realtor and where should i draw the line on what I can ask?

Thanks for the advice in advance!

[Marcus Auerbach]

Quote from @Chris Loh:

Hi BP Forum Members, 

I'm a first time home buyer.  I found a loan officer I really like and he recommended a realtor.  I haven't really had time to speak with the realtor but I was wondering what his responsibility is? To be more exact, can I tell the realtor I'm looking for a property that cashflows $500 if I house hack it and send him to work?  Or do I just send him properties I want to look at?  What should I expect from my realtor and where should i draw the line on what I can ask?

Thanks for the advice in advance!

Great question, actually! Even agents would give you different answers. Here is my take and an overview of our process step by step:

1.) Buyers consultation (often zoom): introduction, what you are looking for, talk about the process step-by-step, the market, fianancing, how to compete and any questions

2.) Setting up MLS access: based on your criteria, we set up a wide net. About 50% of our clients end up buying something different than they thought originally.

3.) Baseline showings: this is only educational, we look at properties that are kind of what we are looking for, so you get a baseline of what 400k will get you.

4.) Revisit goals and expectations, adjust MLS filters. Critique interesting listings together (often zoom)

5.) Actual showings: now you are ready. You focus on how it feels, we worry about the issues, defects and concerns. A good agent should be able to find and identify all major issues (making a home inspection the second line of defense)

6.) If you like it and the property checks out, we can strategize your first offer. Gather information, calculate fair market value, discuss offer terms, recommend a strategy and negotiate on your behalf. Your first offer is usually a "practice offer" - especially in a multiple offer situation. You may not get the house and that's okay.

7.) Rinse and repeat until - accepted offer! Now your agent (or the teams transaction coordinator in our case) reviews all deadlines, starts comunicating with all parties: lender, title, agents, inspectors, appraiser etc

8.) Working through contingencies: typically you have hime inpection, appraisal and financing. Identify issues, negotiate solutions for each on your behalf, especially repairs and appraisal issues. This should take about 30 days.

9.) Clear to close: review closing statements and explain whats next.

10.) Closing: you will sign a stack of paper, agent is only there to explain things if necessary

11.) Post closing: need a contractor? Where to buy materials? Not sure what the best option is to fix a few things. A good agent should have plenty of remodel experience.

We do generally not pick properties for our clients, simply because 90% of the time we don't pick what the clint wants. But we do help review all available listings, what to look for and identify interesting listings and then discuss pro's and con's - it is a collaborative process.

One of our main objectives is to provide perspective. A good agent closes at least 24 deals per year or more. This results in a ton of experience and that is the main value an agent brings.

All agents on my team have construction experience, some of them have house hacked. Milwaukee has a ton of duplxes and most properties are between 60 and 100 years old - knowing what it costs and how long it takes to fix typical issues is another major contribution an good agent should bring. First time home buyers are notorious for underestimating how much things cost "my buddy is handy, I can do this on the weekends etc"