Ready to house hunt? It's a jungle out there: Prepare for a flurry of paperwork, stampedes of buyers competing for the same property, and other challenges before you get your hands on those house keys.
Homebuying can be complex and stressful—especially for first-time buyers. Having a real estate pro by your side can make all the difference.
You might have heard of buyer's agents, selling agents, listing agents, and so on. You're a buyer, so what is a buyer's agent?
True to their name, buyer's agents are ethically obligated to work in a buyer's best interest. They help real estate buyers navigate the market and save time on the road to their new home.
Recently, the National Association of REALTORS® reached a settlement that went into effect on Aug. 17, 2024. The settlement includes several changes in the agent-buyer relationship that benefit homebuyers.
Here's how a real estate buyer's agent can help you in your home search and how to find the right one for you.
Benefits of using a buyer's agent
"Unlike going through a listing agent who serves the seller's interests, a buyer's agent is committed solely to you," Dickson Realty Agent Kristin Ryan shared on her Instagram account. "They ensure your needs and preferences are top priority, offering unbiased advice and support throughout the buying process."
Here are some of the things a buyer's agent can do:
Find the right property
After determining what the clients are looking for and can afford, the agent will schedule appointments to tour homes that fit the bill. The agent can also explain the pros and cons of various properties and neighborhoods to help buyers decide which home is right for them.
"Your buyer's agent can tap into a network that goes beyond the usual listing, including off-market or 'pocket' listings," Ryan said. "This access can be crucial in finding your dream home in competitive markets."
Ryan also said a buyer's agent can offer specialized knowledge of the local real estate market, including trends and neighborhood dynamics. This insight helps educate buyers and may lead to discovering hidden gems.
Negotiate the offer
The buyer's agent will advise clients on an appropriate price to offer and present it to the seller's agent. The agent's experience negotiating deals can save you money and help you avoid pitfalls like a fixer-upper that's more trouble than it's worth.
"Having a seasoned negotiator on your side can save you thousands," Ryan said. "Buyer's agents negotiate not just on price, but on terms and conditions that best serve your interests."
Recommend other professionals
A buyer's agent should also be able to refer you to reliable mortgage brokers, real estate attorneys, home inspectors, movers, and other real estate professionals. This can also help expedite each step of the process and move you to a successful real estate sale all the faster.
"From arranging viewings to coordinating inspections and navigating closing procedures, your agent handles the logistics," Ryan wrote on Instagram. "This coordination is essential for a smooth journey from house hunting to homeownership."
Help overcome setbacks
If the home inspector's report or appraisal uncovers new issues, a buyer's agent can advise you on how to proceed with the transaction and act as a buffer between you and the sellers or their broker. If negotiations become heated or hostile, having an experienced professional keep calm and offer productive solutions is extremely helpful.
"A buyer's agent looks beyond the surface, advising you on the potential or pitfalls of properties," Ryan wrote in her post. "They help you see the full picture, including future resale value and necessary repairs."
Buyer's agent vs. listing agent: What's the difference?
Buyer's agents are legally bound to help buyers, whereas listing agents—the real estate agent representing the home listing—have a fiduciary duty to the home seller.
Let's say, for instance, you walked up to the listing agent at an open house. You might gush about how you love and want to buy the home. You may then unwittingly add that you will need to move soon—because you're expecting your second child and need to decorate the nursery pronto or because the lease on your rental is up in a couple of months.
A seller's agent could then use this information against you by informing the sellers that your clock is ticking, so they shouldn't budge too much on their asking price—if at all.
Yet, make this same confession to the buyer's agent you're working with. This professional would know to keep this information private from sellers (and their agents) so it can't be used in negotiations.
Nevada recognizes this problem and requires disclosing dual agency when a broker represents both sides of a real estate transaction. In some other states, dual agency is illegal.
However, you may still not be comfortable after signing an agreement saying you know someone is a dual agent. You might want to hire an agent who is not representing the owner and looking out for your best interests.
How to find a buyer's agent
A good buyer's agent can ease the path to homeownership, while a bad one can result in a bumpy ride. Here are some questions to ask to help you find the right one.
"What neighborhoods do you specialize in?"
Real estate requires local expertise, so you should find an agent who's extremely familiar with the areas you're interested in.
"What's your schedule and availability?"
Committed part-time real estate agents can do a fine job, but if the house of your dreams pops up or you encounter last-minute closing snafus, you want an agent who is readily reachable.
"How long have you been a real estate agent?"
You ideally want someone with a couple of years of experience and a proven track record of selling homes.
The agent/buyer contract
Once you agree to work with someone, you must sign a contract before touring a home in person or virtually, outlining the agent's services and compensation (more on that next). However, you do not need a written agreement when interviewing an agent or talking at an open house.
This contract also means that this person will be your sole representative and that you won't work with other buyer's agents.
The contract should generally outline the negotiated terms, detailing the services provided and their cost.
According to the settlement for the NAR, the contract should include these things before you sign it.
- A specific and conspicuous disclosure of the amount or rate of compensation the real estate agent will receive or how this amount will be determined.
- Objective compensation (e.g., $0, X flat fee, X percent, X hourly rate)—and not open-ended (e.g., cannot be "buyer broker compensation shall be whatever the amount the seller is offering to the buyer").
- A term that prohibits the agent from receiving compensation for brokerage services from any source that exceeds the amount or rate agreed to in the agreement with the buyer.
Who covers the buyer's agent commission?
In the past, sellers generally covered both buyer and seller's agent fees. As of Aug. 17, buyers will be responsible for paying their agents a fee. Remember, your agent's compensation is entirely negotiable.
While the seller may agree to compensate your agent, this offer cannot be shared on a multiple listing service (MLS)—local marketplaces used by buyers and listing brokers to share property information.
As a buyer, you can still accept concessions from the seller, such as offers to cover your closing costs. When choosing a real estate agent, ask about their services and compensation to ensure you fully understand the process.
