What should 3% get me?

[Arthur Banks]

I'm sitting here going through listings that my agent sent me. More accurately, going thru through the listings that are auto-generated. That led me to thinking... what exactly does my agent do to get 3% of my money? I know he only get's 1/2 of that but even saying that, what does the broker do? That's another topic... My current acquisition, I "found" on the listing that was generated to me. Other than get me in to see the property, I can't quite say what his duties were. I'm not saying he did nothing, but I don't know exactly what he did to help me find the deal. He hasn't brought me any deals. The things that he's done is gets me in to properties and set up the MLS criteria that I asked for on the listings. Should I be getting more services for my money? I'm not some big shot, doing multiple deals a week or anything, but I just want to get an idea of what I should be getting. I just feel some sort of way about giving up money for what doesn't seem like a lot.

[Ed L.]

as a buyers agent in my Mls we typically only make 2.4%.   Listing broker gets 3.6

Just a bit of what I do as a buyers agent.  

Constantly monitor the market based on your criteria.  I check the hot sheets on average 3 times a day for new listings, expired, pending, closed, price reductions, fall through, etc.  I know the market inside and out. 

Drive all over creation showing houses.  Get covered in flees going in foreclosures, chased by dogs, etc.  

As a buyers agent in not trying to sell you anything in particular.  I'm trying to find what you want.  So there's no pressure sales like dealing with a listing agent.  

I sacrifice my afternoons, weekends, holidays, etc to be available for my clients needs.  Try scheduling 10 different showings with 10 different listing agents.  It's a pita trying to coordinate with multiple people.  

Assist in evaluating the subject property, research comps and help determine a realistic offer price and arv.  

Draft said offer and do my best to protect my client and limit their exposure.  Hustle documents back and forth making sure everything is handled in a professional and timely manner. 

Hold your deposit in my brokerage account vs giving it to some random entity.  

Provide references for home inspectors, contractors, financiers, title attorneys, etc.  I'm dealing with this every day so I know who to work with and who to avoid.  

I coordinate and meet with all of the above to make sure things are moving along as planned.  

If everything works out I get paid at the end of the deal.  If not I did all of the above for free and that's just part of it.  

use a $100,000 house.   That's a $2,400 commission.  40% goes to the brokerage to cover overhead, staff, office lease, advertising, supplies, licensing fees, e&o, etc.  

So thats$1,440 to the agent for probably 3 months minimum work.  To you the buyer it doesn't cost a thing.  It's the best deal in real estate.  Obviously not all agents are willing to put in the same effort but I like to think the better ones earn their keep.