Will Real Estate Return to the Days of “Buyer Beware?”
Twenty-five or thirty years ago, all real estate agents worked for the seller.
The listing agent was in direct contact with the seller and performed much the same duties that listing agents perform today. However, the agents who brought buyers to view the house also worked for the seller.
They were sub-agents, and the only duty they had toward the buyer was that of honesty. They could not knowingly misrepresent the property.
As sub-agents, their duty was to the seller. As far as the buyers were concerned, real estate agents were door-openers who assisted buyers in filling out all the blanks on an offer form. Then they had some obligation to make sure things were done on time.
There were agents who went against the rules and did for all intents and purposes worked “for” the buyers, giving advice and support throughout the transactions. Some even revealed confidential information that sellers didn’t want shared with buyers. They weren’t supposed to do any of that.
In fact, if they knew confidential information about the buyers that would help a seller’s bargaining position, they were supposed to share it. Buyers needed to be careful what they said to any agent.
The rule in those “Good old days” was “Buyer beware.”
Then along came buyer representation.
Buyers now had someone who worked only for them. Buyer agents now had a duty to advise and protect their buyer clients at every step along the way.
But now – there are those who want a return to “Buyer Beware.”
Folks at iBuyer companies say there’s no need for buyers to even meet in person with an agent – it can all be done with technology.
Companies like Redfin, Zolo, Purple Bricks and the like say they provide all the advice buyers need via the Internet. They can learn how to make an offer, how to order an inspection, how to contact the listing agent to arrange for access to the home, how to work with a lender, and how to work with an attorney or title company to close the transaction.
Never mind that these buyers have no one working for them who will answer questions or help them negotiate with the sellers. They have no one to help them write an appealing offer or to guide them in asking for concessions, requesting additional inspections, etc.
Once they are under contract, they are completely dependent upon the listing agent to see that the paperwork is in order and all conditions have been met.
All experienced agents know that there are periods of drama in a transaction. Title reports reveal issues that can delay closings, inspections reveal repair issues to be negotiated, and pre-closing walk-throughs reveal unexpected problems that should be handled prior to closing.
Experienced agents know how to navigate these rough waters. It’s doubtful that on-line instructions can do the same for unrepresented buyers.
But that’s not the only problem for unrepresented buyers…
With no agent on hand to assist in the home shopping process, buyers are at a huge disadvantage.
A dedicated buyer’s agent will listen to the buyer’s wants and requirements, then search using both the agent remarks in MLS and their own first-hand knowledge of the homes and the neighborhoods. They know if a home is over priced and will advise their buyers accordingly.
They can help a buyer choose a neighborhood that will put them close to work, school, health services, and/or recreational venues that matter in their lives. They can alert them to changes coming in the area that could increase or decrease the value of a house they’re considering.
They can help a buyer see past bad photographs, a messy house, or cosmetic imperfections to find a true bargain. They can also help that buyer spot potential trouble-spots in a house that’s been perfectly staged and presented.
Once the buyers are under contract, their agent will stay on top of the transaction, guiding and protecting them.
And they will still be there after the closing – ready to offer advice and friendship.
You can’t say any of that about a website.