Do I need an agent?

Question

Hi all,

I've met with a real estate agent here in Tucson, but she hasn't suggested any properties - really dragging her feet.  I've driven all over looking at properties by myself and found several I want to make offers on.

Do I need an agent to do this?

If I approach the listing agent myself, can I actually have him/her write up the offer for me?  I've heard they can make double commission and may be more enthusiastic about presenting your offer.  Is this true? Legal? Ethical?

If so, how do I do it?  Are there dangers  to me?

Thank you all in advance.

p.s.  Anybody want to wholesale or turnkey a property to me in and around Tucson, now is the time!

Steven Zagaris · Answer

It sounds like your agent is just lazy. If the market there is anything like it is here, (low inventory) then a lot of buyers agents are unmotivated since it is so difficult to get anything but a cash buyer accepted. At least that is how many agents around here are behaving.

Paul Timmins · Answer

Ryan

You always want to work with the listing agent. They are dealing directly with the seller and can give you the best info.

You want as many agents as possible working with you. You explain you are interested in their Listings only, you only deal with the listing agent as you have too much respect for the commission process you want them to get full commission. If the listing agent asks to have you work with someone in their office that is different you can work with that person.

If an agent asks for your criteria and you don't make it clear about the listing aspect, they will program in a minute a loop that will search MLS each day and send you an email announcing the deals that fall into your criteria. I don't think setting up the loop one time justifies the commission split.

Paul

Jesse Rivera · Answer

Edward Burns, Back in the day, I would agree with you, we all worked for the seller ( I had my license in the 90s, back when we still used the listing books). But today it is clearly stated that if I am the buyers agent, I work for the buyer, and not the seller. I work for the best interests of the buyer, and only owe the seller honesty and fair dealing.

Ryan DeLange, when the deal goes smoothly, working with the listing agent alone is fine, once you get a little experience. The problem is, there are no easy deals anymore. Every escrow is a challenge to close.

Also, it takes an agent many, many deals before he is able to navigate the contracts and all of the addenda, the timelines and deadlines, the subtle nuance of contract language, and unfortunately the poorly written contracts themselves. As an experienced agent, I can write a contract that favors my client - that is my job.

My advice is to work with an agent for a while, until you get a few deals under your belt.

Nicole Goss · Answer

Ryan DeLange as an investor and a Realtor I’d recommend finding a new agent (one that understands what investors are looking for and is attentive to you).  As Lynn M. suggested look for agent via your local investment group, ask other investors for referrals (who do they use?).  You can also look for Realtors with certain designations, specifically CIAS (Certified Investor Agent Specialist), which means they have completed additional training to understand what investors are looking for.

As @Lynn M. also said in some states a listing agent will refer you to another agent in his/her office (designated agency). In the case of Maryland, their law does not allow dual agency so they must do this.  I don’t know about Arizona, though, so you’d have to check.

Where I am – Virginia - is a buyer agency state and a Realtor can represent the buyer’s interests and will negotiate on the buyer’s behalf during the transaction if they have entered into a buyer agency agreement.  These agreements can even be one-day agreements so the agent can show a perspective buyer homes.  As of July 1st 2012 we are required by Virginia law to have these agreements if we do anything more than ministerial acts for a perspective buyer.  A buyer can also elect to sign a non-agency agreement, which would allow the agent to perform only ministerial acts for the perspective buyer (basically things that do not require a RE license).  And while technically the seller pays the Realtor’s fees in reality that fee is built into the price of the home so the buyer is really paying as part of the home purchase.

As Jesse Rivera said if you find a great agent they can make a great addition to your team.  Yes, you can do it yourself but if you’re dealing with a listing agent that means the Seller has professional representation and unless/until you are comfortable with the nuances of offers and contracts I’d humbly suggest you do too.
Best of luck to you!

Ryan DeLange · Answer

Thanks for all the wonderful responses; I've learned tons.  I've decided, based on the totality of your replies that, for now, I need an agent.  I've called around, based on recommendations, and found a guy who has a little experience with working with investors, but seems keen.

Thanks again, and wish me luck!

Gil Lieblich · Answer

As others have said each state has its own rules...
That being the case there is three types of agents, listing agent (sellers), buyers agent, and a dual disclosure agent. 
When you meet with an agent they should give you a paper to sign that explains to you what kind of agent they are and how they can represent you. If an agent is a dual agent he/she can represent both parties but there are rules to what they can disclose to the parties and may not act in eithers interest but rather as an intermediary. Of course they are fine with this because they receive full commission. 
The reality RE agents get a lot of their business from referrals and making it seem like they are doing a good job is what motivates them as much as money. At the end of the day its more important to get a deal done than try to keep price higher to get a little more commission. The reality is a few thousands off the price does not really make a difference to them as they get essentially a quarter of the total commission so buyers sellers and dual agents just want to close the deal while making it seem like they are looking out for your best interest. 
But as others say many are not versed in investing so they are not so helpful. And if you dont use an agent just make sure you have a good real estate attorney as thats where they can get you...

JOAN DICKIE · Answer

In Minnesota and Wisconsin, where I am licensed, as long as my broker is different than the seller's broker, I totally represent the buyer.  You can go directly to the seller's agent, but I don't recommend it until you have bought many properties.  An experienced realtor who has a lot of experience in the area and has worked with investors will help you learn the ins and outs of what to look for and what nuances to put in the contract.

Edward Burns · Answer

I am sure the law varies state by state.   But on a house I am closing on in the morning, I had to sign a disclosure with the agent stating that I understood (even though he was not affiliated with listing agent) that he represented and was being paid by the seller.

That does not mean that agent is out to screw the buyer or is not helpful in explaining and cutting through the red-tape and hassles associated with buying RE.  Just indicates he has no obligation to you to make sure you get the best price.

Lynn McGeein · Answer

Edward Burns, Back when I was an agent years ago, it wasn't so clear.  These days, I've found they must declare at first meeting whose interest they actually represent, and the agents I work with will sign that they represent me for the specific properties they've shown me only, no exclusive buyer agent agreements necessary.

Edward Burns · Answer

This is a common misperception, a real estate agent always represents the seller, whether or not he/she is the selling or buying agent.  They all get paid by the seller and usually with a percentage of the sales price.  The only exception is a buyer can and though rarely does hire a agent specifically to represent them, paid by funds to find, negotiate and assist in the buying of property.