Why Do Home Buyers Need To Hire A Realtor?
Buying real estate in Greater Vancouver can be a very rewarding experience. Property owners generally experience pride of ownership and in many cases a financial gain over the long term. Buying real estate is also relatively complex and for this reason many buyers seek the help and professional support of a licensed real estate representative, whose resources, contacts and skills are critical in guiding you smoothly through the process of buying your home.
When you start out on your “hunting” trip, an experienced Realtor® can find your target quickly. Since Realtors® are backed-up with the MLS® database, the first obvious advantage of utilizing a realtor is that a Realtor® can efficiently identify and locate those desirable “active listings” for you to consider, according to your particular demand.
Preliminary investigation and timely information gathering, as to lot-size, square footage of floor area, age of building and asking price, etc, are on the way. A realtor can give you advice as to the pros and cons of specific properties and locations from the point of view of school catchment, level of convenience and future appreciation potential, etc.
Different locations and properties vary greatly in those respects. Afterwards, showings will be arranged at the buyer’s convenience. The rule of thumb is that buyers look at about twelve properties before they are ready to make an offer. Now having a professional Realtor®’s advice can make a difference.
In fact, purchasers usually get Realtor®’s service for free, since the buyers’ realtor usually gets a sales-commission form the sellers. When the sellers list their property for sale, they pay the remuneration in the listing agreement for both the listing Realtor® and the other Realtor® representing the buyers. In other words, the listing agent shares the commission with the buyer’s agent, in order to respect and appreciate the counterpart bringing in the buyer.
Therefore, it must be pretty wise for the buyers to take advantage of this fact by taking a Realtor’s professional advice and having someone protect your interests at the same time.
Now you are facing the toughest stage which is the negotiation of price and important terms in the Contract of Purchase and Sale. Experience has found that having the buyers and sellers negotiate face-to-face often leads to lose-lose. The naturally high emotions can overwhelm the facts that both parties are on the same boat and create unnecessary obstacles to finding a win-win agreement. The process works much smoother when an experienced realtor is involved by providing practical tactics and passing information back and forth during the negotiations.
You may choose to have the seller’s realtor represent you as well, in addition to representing the seller. This is called “dual agency”. You might expect that using one Realtor® instead of two would result in a lower sales commission being paid, enabling you to negotiate a lower purchase price. However, in the case of dual agency, one Realtor® has to do the work of two. For this reason, in the listing agreement a seller usually provides the total commissions, for two, to go to his or her Realtor® when the buyer does not have a separate Realtor®, instead of the commissions being shared between a buyer’s and a seller’s Realtors®. This means the seller is unlikely to be able to reduce the price just because the buyer has not engaged a separate Realtor®.
Meanwhile, in “dual agency” a Realtor® has to provide a duty of confidentiality, loyalty and full disclosure and must be impartial to both the seller and the buyer at the same time. But because of the quality of “Buy and Sell”, the seller and the buyer naturally have conflict of interests. If a Realtor® represents both parties, he or she has to reluctantly stay away from giving advice as to possible price and terms in the contract. Knowing this fact and being afraid of losing professional advice, even many experienced sellers would choose not to grant “dual agency” to the listing agent. Therefore for a buyer, it would be also wise to take full advantage of the fact – Realtors® being paid by sellers, utilize Realtor®’s service and have someone protect your interests on the table.
In addition to the above mentioned tasks, a Realtor® also helps you orchestrate all the other details of a real estate transaction as to arranging inspections, delivering documents to your lawyer or notary, and last but not least, handing over the keys at your new home on procession day.