Lancaster County PA Realty Check: Why Doesn't the National Association of Realtors Promote BUYERS' Agency?

Why Doesn't the National Association of Realtors Promote BUYERS' Agency?

National Association of Realtors(R)Did you know that the NAR (National Association of Realtors) is the largest trade association in the US?  With 1.3 million members, the NAR is a major proponent for home ownership and property rights.

NAR's national publicity campaigns have promoted a more professional image of Realtors(R) helping buyers find just the right house, and helping sellers market their homes in the most effective way.

I was not big fan of the previous campaigns that stated "You have a life.  Real estate is our life."  Nonetheless, it did make the point that Realtors are prepared to work hard and ethically for the public.

Everyone knows that a Realtor will show homes to buyers.  Everyone knows that Realtors have sophisticated marketing tools for selling homes.  Here's my question: Why hasn't the concept of Buyer Representation received more public emphasis from the NAR?

Many buyers start their research on the internet to look for a home.  Almost invariably they start out by looking at the homes that are listed in what they calculate should be their price range.  After narrowing the field down to a controllable number, buyers often assume that they will do better by contacting the listing agents for each listing, and having each agent describe the features of their particular listing, and show the home if it sounds good to the buyer.

The buying public is woefully unaware of the fact that they are unrepresented as they go through this process.  They often feel as though an agent is an adversary to be tolerated since the agent is the one with the keys to the homes!

Nothing could be further from the truth!   But NAR, with its public megaphone, has largely ignored the aspect of promoting Buyer Representation.  Everyone know that sellers will have an agent tasked with the responsibility of representing the homesellers' best interests.  But what about buyers?  Do they know the difference between being a customer and a client?

Unfortunately, many buyers don't know what they don't know, and the National Association is in an ideal position to educate the public.  There is little emphasis on the importance of choosing a competent Realtor to represent buyers before the choice of a property is made.

An agent representing the buyer can offer objective advice about each home, including possible reasons NOT to buy a particular house. 

A Realtor representing a buyer can be an experienced negotiator, keeping the buyer's negotiating position confidential.

A Realtor representing a buyer can provide due diligence in suggesting specialized inspections that may be indicated, or provide advice on the advantages or dangers of various financing options.

A buyer can have representation in most cases for FREE.  Why wouldn't every buyer want to take advantage of a service that could give them so much protection and value - and even save them a great deal of money - for NO COST TO THEM?

As an Accredited Buyer Representative in Lancaster County, PA, I am very much aware of the need for more public education on the subject of representation.  If you have any questions about buyer representation, I would be happy to answer your concerns via email, or call (717) 951-5552.

 

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Brian Schulman offers expert personalized real estate representation and services in Lancaster County, PA.  To contact him, visit http://www.FindLancasterHomes.com/

 

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Comment balloon 82 commentsBrian Schulman • April 17 2008 08:06PM

Comments

Brian - I couldn't agree with you more.  I think promoting buyer agency benefits the REALTOR image.
Posted by Cyndee Haydon, 727-710-8035 Clearwater, Beach Short Sales Luxury Condos &Homes (Charles Rutenberg Realty) about 10 years ago

A better question, in my mind, is "Why don't more AGENTS elect Single Agency?".  Here in Florida, where transaction brokerage is default, few agents bother with getting a client to sign anything.  It is easier to just run off into the sunset showing homes willy-nilly and hoping for an outcome.

While this is a recent change to my approach, I think that Buyers Agents have a leg up in the process we are dealing with on REOs and Short Sales.  I have not had any serious buyer turn me down when I offer Single Agency.  It did flush out a couple of lookey-loos when they were faced with making a decision on their direction.

Posted by Cape Coral Florida Golf Course and Waterfront Homes (Gulf Coast Realty Network, Inc.) about 10 years ago
I dont know why they dont promote the buyer rep as much, maybe you will get an answer
Posted by Bart Whitmore, Real Estate Agent (Keller Williams- Louisville) about 10 years ago
And some buyers still think they are the ones that pay us! I agree, with as many members as we have, we need to speak up and educate.
Posted by Danial Dansereau, Fernandina Beach Realtor® (Watson Realty Corp.) about 10 years ago
Cyndee, I agree - the REALTOR image, and agents in general, could have an improved image if the public were more aware of how we can protect their interests.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Jim, I think the operative rule should be that agents should only represent a single party in a single transaction.  I don't think we're doing our previous buyer client any favors if we refuse to represent them later on when they're ready to sell the home they purchased through us.

Your comment opens up another discussion for another day. 

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
I strongly support the use of a Buyers Representation agreement, especially when taking clients to new home communities. I also have the ABR designation, and it helps me a bunch with educating my clients.
Posted by Lorraine or Loretta Kratz, Certified Negotiation Consultants (Crescent Moon Realty, Inc. & Land N Sea Auctions.) about 10 years ago
Bart, I hope you're right.  I'd be happy to get a response.  I don't want to get anyone in NAR upset - I'd just like to see more public representation and education of Buyer Agency. 
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Good question, Brian.

I think CREA (the Canadian version of NAR) promotes buyer agency a bit more than NAR does, however it still isn't enough.
When you consider that a buyer can have their own representation at no cost to them (since we are paid via the mls agreement on the property by the seller), it's one of the absolute best and most under-rated services available to the public today!

Jo 

Posted by Jo-Anne Smith about 10 years ago
Danial, it's true - many buyers come to us with misperceptions about how real estate agency works!
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Hi Jo,

You make an excellent point!  A buyer can have representation for FREE.  Why wouldn't every buyer want to take advantage of a service that could give them so much protection, value - and even save them a great deal of money - for NO COST TO THEM?

It's a matter of the topic not having had enough public advocacy

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Brian, this is a great point. I agree, I would like to see buyer agency promoted more by the NAR. In the mean time, we have to do our part to educate the consumers.
Posted by Mike Mitchell, REALTOR (R) (Real Living Kee Realty) about 10 years ago
Brian, I suspect NAR is reluctant to promote Buyer Agency because Agency Laws differ from State to State. 
Posted by Dan Gobis (Re/Max Newport Realty Corp.) about 10 years ago
Lorraine and Loretta, to be fair, the ABR (Accredited Buyer Representative) designation is officially sponsored by the NAR.  But it doesn't get enough public exposure to be widely understood.  More could be done by our national and state organizations.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
You are right - if this were sponsors or encouraged more then it would become more commonplace. Thanks for posting.
Posted by Bob & Carolin Benjamin, East Phoenix Arizona Homes (Benjamin Realty LLC) about 10 years ago
Mike, I agree - I think we all do our best to educate our spheres of influence.  But the NAR and state organizations have a great deal more leverage than we do - and I for one would like to see them use it to a greater extent for buyer agency education.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Dan, I don't think that general promotion of Buyer Agency principles would violate any differences between state rules and regulations.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Bob and Carolin, thanks for your support!  If the national organization got enough feedback from its members, perhaps buyer agency would be higher on their priority list.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
It has the same basic challenges as a National MLS has. IMO
Posted by Dan Gobis (Re/Max Newport Realty Corp.) about 10 years ago

Brian, I agree with 98% of your post. I just completed the NAR online survey about the two "ads" that NAR is running. I cringe when I hear NAR stating that property values have doubled in the last 10 years, something that is far from the truth in most areas of Ohio. The emphasis seems to be geared toward misinforming sellers what their property is worth.

The 2% I disagree with? The buyer pays the brokerage fee... even though it comes from the seller's net sheet.  Buyer doesn't bring a wheelbarrow of money to closing? No completed transaction. However we could debate that forever, and get more and more mixed up.

 

Posted by Jim Dvorovy, REALTOR - Canton Ohio Real Estate (Cutler Real Estate) about 10 years ago
I also agree why don't you call NAR and ask them if they might consider using your idea in future ads.
Posted by Terry & Bonnie Westbrook, Westbrook Realty - Grand Rapids Forest Hills MI Re (Westbrook Realty Broker-Owner) about 10 years ago

Jim, I've been through this discussion with different people many times.  I agree that you can make a case either way for which side actually pays the agents (on both sides).  My opinion is that homes are already priced with a fee built into the price. 

The price doesn't come down because the buyer doesn't happen to be using an agent who represents him or her.  The price doesn't even come down if the seller isn't using an agent at all - because the main reason sellers go For Sale By Owner is to save the commission for themselves - not to pass on the savings to a buyer.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Terry, that's not a bad idea.  Along with whatever comments I receive on this post.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Brian, you bring up some very excellent points.  I never stopped to think that they don't offer consumers enough information regarding buyer representation.  Perhaps it's not just NAR, but the local state associations might need to do more, as well.
Posted by Jeannie Kontis about 10 years ago
Jeannie, indeed - the state associations could do much more as well in educating the public about the advantages of being properly represented in one of the most important purchases of most people's lives.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Brian...this can't be mentioned too much! Buyers still don't get it. And I agree NAR doesn't stress the benefit of using a Realtor to a Buyer. They seem to stress the Listing side.

I would love to see a series of ads stressing Using a Realtor to Buy and using one to Sell. Representation!

(Congrats on the feature!)

Posted by Joan Mirantz, Realtor, GRI, CBR, SRES - Concord New Hampshire (Homequest Real Estate) about 10 years ago
Brian, I agree with you.  Buyer Representation is overlooked in some places, but here in our market, it seems like there are very few dual agent closings, or a buyer withour rep.  Thats just how we do things here.
Posted by Joshua & Kathy Schmidt (ERA Henley Real Estate) about 10 years ago
Joan, you're right - many buyers don't really understand agency - but that's the case because our associations and representatives haven't been emphasizing this important aspect to the public.  I agree that a series of ads explaining representation, and the difference between being a customer and a client - would be very valuable.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Joshua and Kathy, I'm glad that most buyers have representation in your market.  Many do in my Lancaster County, PA market as well.  Still, there are misunderstandings about the increased level of accountability, confidentiality, and obedience that a represented buyer receives.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
That's a really good point Brian. It would be in the public's best interest to be aware of this situation.
Posted by Wayne B. Pruner, Tigard Oregon Homes for Sale, Realtor, GRI (Oregon First) about 10 years ago

Not all companies have the same programs, charge the same, or behave the same. Clearly, there is an advantage to the buyer to utilize the services of a Buyer Agent. However, in or MLS for example, we have a specific place to notate "VR or DR", which stands for Variable Rate or Dual Rate. That means the listing broker has an "if, then" scenario. (Mr. Seller, if the buyer comes through our company we will charge x$ (a reduced rate or waive one side commission) . If the Buyer comes through a cooperating agent, we will charge X$.

We are supposed to use this notation so that Buyer Agents will have a heads up that their offers will need to beat the listing agent's offers by X% or X$ in order to have the best net for the seller. From reading the above hyperlinked FTC report, I personally would not ever tell a buyer that their representation is free. Nor, would I tell them that the listing company will keep both sides of the transaction. I am aware that some companies do not "double dip" if handling both sides of a transaction. That said, I support single agency and believe buyers' benefit when having a personal REALTOR/Advocate.

Perhaps the "Buyer Education" should come from the Specialists rather than an organization. I have met Buyers who are educated and still prefer to deal direct with the listing agent because they believe the listing agent knows the property best. Some buyers believe that they are competent enough to research and negotiate offers on their own.

Posted by M. Suzi Woods (Gravenstuk), Suzi Woods, Prior Independent REBroker in MS (NOW Sharing the life and spice of the GC one day at a time) about 10 years ago

Wayne, thanks for commenting.

Suzi,  I have no problem with educated buyers who prefer to work directly with the listing agent.  My point is that many more buyers have misconceptions about being represented, and would benefit from increased awareness.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
I love buyer broker agreemens and buyer representation.  But with some buyers, there is a wall, they cannot grasp the idea.  More public education would be a HUGE benefit to our industry.  Great Post!
Posted by Leslie Stewart, Realtor, ABR, CRS, Oregon Licensed Broker (Oregon Licensed Broker with Berkshire Hathaway HomeServices Real Estate Professionals) about 10 years ago

Brian -- There seems to be so much hostility toward designations among some AR members that it doesn't surprise me more agents are not pursuing the ABR.

Posted by Eric Kodner, CRS, Madeline Island Realty, LaPointe, WI 54850 - (Madeline Island Realty) about 10 years ago
Great information and accompanying analysis. Thanks for taking the time to write such an informative post.
Posted by Lisa Lambert, Esq. 1031 Exchange Expert (The Law Offices of Elisabeth A. Lambert) about 10 years ago

Great Point Brian!

It amazes me how many unrepresented 1st TIME HOMEBUYERS I come across, that are absolutely convinced that they don't want/need a Realtor.  NAR needs to really take a look at this, even at a local level with our State and County Associations.

Posted by fdasfdsafa gegrerbv about 10 years ago

Wonderful post Brian.  The answers to many of our questions are well known to many of us who have been dedicated buyers agents for many years.  I'll post something later to give some history for some of the new agents.  We do have a lot of REALTORS who became licensed and members during the "boom" years of 2003-2006. 

The gravy train has left the station now and folks can benefit by learning our business beyond the "meet, write, close" of the boom years.

I rarely write about buyer's agency on ActiveRain because it's complicated and I get so tired of hearing the ever trite "I treat everyone fairly". 

In reality, the NAR has gone a LOT farther to promote Buyer's Agency than they ever wanted to.

 

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate) about 10 years ago
Leslie, there is a wall with some buyers.  I can't help but think that the wall, for many, is borne of insecurity, and reluctance to make a commitment.  Further education and awareness of the benefits of enlisting the skills and experience of an ABR could only be helpful in reducing the resistance, to what would clearly be in most buyers' best interests.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Eric, I haven't come across any hostility toward designations - in fact, just the opposite - I get and give respect for those practitioners who have gone over and above the minimum standards, to strive for the extra effort and knowledge it takes to achieve these professional designations.

Have you encountered designation hostility from other AR members or from the public?  The only running hostility I have observed is the ongoing argument about whether single agency for a single transaction is best, or exclusive buyer agency where listings are never accepted.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Bryan, first time home buyers often seem the most resistant to being represented.  It's not that they don't think that they need the help.  It's usually insecurity about having to make a commitment to any agent. 

You're right - further public education by all three levels of Realtor associations would be very helpful for both buyers and the  Realtors who are ready, willing and able to represent their best interests.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Lenn, "I treat everyone fairly" is the typical response of practitioners who don't specialize in buyer representation.  As you say, it sounds good but it doesn't properly appreciate the difference between being represented and not being represented.

In fairness, the NAR has indeed come farther than in previous decades, particularly by incorporating the ABR curriculum into their certified designations. 

I'll look forward to your analysis of the history of buyer representation.  I was one of the earliest ABRs, barely missing the coveted "first 500".

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Brian.  I get in so much hot water on ActiveRain with "hard core real estate talk".  However, nothing stirs more passion and anger in this real estate broker than the treatment of those of us who believe that the entire system is quite fixed and is not likely to change in the near future.  No doubt, when I do post something, it will be disputed by many dual dudes and dudettes.  With any luck and I have an abundance of this luck, it won't be featured and few will even notice.

 

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate) about 10 years ago

Brian - Not to hijack here, but I just posted on the subject of designations last night. I did so because I read another post by a young lady last week on AR who was simply asking which designations she should pursue.  She got bombarded by responses that designations are "worthless" and far too easy to acquire.

Getting back to the subject of your own post, I like the ABR because it has a production requirement.  ABR applicants must prove a sales track record as a buyer representative.  Like the CRS, requiring proof of closed sales adds a dimension to the achievement of a designation that coursework alone does not offer.

Posted by Eric Kodner, CRS, Madeline Island Realty, LaPointe, WI 54850 - (Madeline Island Realty) about 10 years ago

 

It is important to NAR that the idea of "Buyer Agents" be a little "fuzzy".  If it wasn't then buyer's would recognize the potential trap of working with an agent whose company lists homes. The trap being,  "Oh, now I'm a "DUAL AGENT".  Another concept kept fuzzy for buyers because if they really 'got' it they would go with a single agency company.  There are few of those around.  For seller's there is not even a national organization of companies that pactice single agency.  For buyer there is the small but growning National Association of Exclusive Buyer Agents (www.naeba.com).  NAEBA members follow a code of ethics that is more strict than the NAR COE.

 NAR is not going to push single agency and antagonize the big franchise companies.

 

Posted by Paul Howard, Paul Howard Realty, 856-488-8444 (Paul Howard, Broker, Paul Howard Realty 856-488-8444) about 10 years ago
This is so very true Brian, buyers agency should be stressed as much if not equal to the sellers listing agreement.
Posted by Michael Wayne Jackson, Realtor - Senior Real Estate Specialist (Coldwell Banker) about 10 years ago
Brian - Absolutely!!!  I tell all potential buyers who come to me looking to get a mortgage to go out and get a Buyer's Agent right away.  They need someone representing and working for them, having their interests as their top priority.
Posted by Jason Sardi, Your Agent for Life (Auto & Home & Life Insurance throughout North Carolina) about 10 years ago

I think it comes down to the power structure in the NAR being tied up by those that look to double side transactions.  The "old-timers" all talk about ways to increase the transactions where we double side the sale to earn more money.  And it isn't just the NAR. 

And, since the power agents seem to be listers, they would love to not have to deal with as many buyer's agents... certainly don't want to promote the idea.   

Posted by Lane Bailey, Realtor & Car Guy (Century 21 Results Realty) about 10 years ago
Problem is...NAR is out for NAR not the Realtors they represent. If they had Realtors best interests in mind...they would not have sold us out with realtor.com
Posted by Jeffrey DiMuria 321.223.6253 Waves Realty, Florida Space Coast Homes (Waves Realty) about 10 years ago

 I think that one way to get more buyers seeking agents is to give them another incentive to do so.  I know, they really don't need anymore incentives in realtors eyes.  They are already getting a free service paid by the seller, and they have someone that is looking out for their best interests.  This is just how people are though.  

Posted by Anthony about 10 years ago
Brian:  I am shocked that NAR doesn't put more emphasis on the Buyers Agent.  Let's face it without Buyers you have half a deal.  There is the art of negotiation, representation and diligence that can only be handled by the buyers agent.  I shun all transactions where the listing agent represents both parties, you have to be kidding. And I really get furious when a listing agent represents both parties and does the loan, I am sorry that's just too much power for one transaction.  For transparency we need a buyers agent, sellers agent, and loan originator, preferably a Certified Mortgage Specialist.  While the all in one house transaction makes a nice tidy deal, it reeks of self interest.  Patti - Capital Line Funding Group, CA  
Posted by Patti Geib (Capital Line Funding Group) about 10 years ago
Brian - I couldn't agree with you more... You would think that they would want to help us tap into the buyer's who are out there and help the public understand our value on the buyer's side.
Posted by Debbie Summers (Charles Rutenberg Realty ) about 10 years ago
totally agree
Posted by Alan Robinson (PTE REAL ESTATE GROUP) about 10 years ago
They don't have a clue. They go out there on their own and think they know it all. When they want to write these ridiculous offers the reason they do is they're trying to save the commission. They don't get it that they need a licensed professional to help them thru the process.
Posted by Robert L. Brown, Grand Rapids Real Estate Bellabay Realty, West Mic (www.mrbrownsellsgr.com) about 10 years ago

Eric, those supposed professionals who feel that professional designations are worthless have either not bothered to improve their knowledge, or slept through the classes.  I personally would not, as a consumer, work with an agent who had such an attitude.  It's unfortunate that the young lady you mentioned should be getting such misguided advice.

I agree with your opinion that the ABR is even more valuable because a certain amount of experience has to be proven by the applicant before the designation can be received.

 

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Paul, you may have an interesting point there.  I don't know what the politics of advocating buyer agency would be for NAR.  I belong to a small independent brokerage.  Therefore the chances of my being in a position of disclosed dual agency for the particular needs of my buyer clients are quite small.

In any case, with the larger companies, designated agency can be used to create a "firewall" between two  agents with the same company, regarding confidential information of either buyer or seller.

As Lenn Harley has mentioned more than once, sometimes the  comments on our blogs are more interesting than the blogs themselves...

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Lisa, thanks for stopping by!

Mike,  I tried to promote "buyer listing agreements" before the ABR designation existed, or the idea of buyer representation was widely accepted.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Jason, not only do I agree with you, but I wish more lenders would recommend that their borrowers find and work with a good buyers' agent. 

By the same token, when I start working with a new buyer client, the first thing I want them to do is to get preapproved by a good lender -  before we start looking at properties!

Just this week I insisted that one new prospect get preapproved before I set showings for the properties she wanted to see.  She ended up getting approved for only two thirds of the price she thought she was qualified for.  We were able to avoid the disappointment, embarrassment and trouble we would have had to go through if she had made an offer on a property that was out of her price range.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Jason, not only do I agree with you, but I wish more lenders would recommend that their borrowers find and work with a good buyers' agent. 

By the same token, when I start working with a new buyer client, the first thing I want them to do is to get preapproved by a good lender -  before we start looking at properties!

Just this week I insisted that one new prospect get preapproved before I set showings for the properties she wanted to see.  She ended up getting approved for only two thirds of the price she thought she was qualified for.  We were able to avoid the disappointment, embarrassment and trouble we would have had to go through if she had made an offer on a property that was out of her price range. 

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Lane, you're right, the "power agents" are mostly listers.  Listing agents certainly have an incentive to sell their own listings and double their commissions.  There's nothing wrong with that, as long as the buyers understand who's representing whom.  However, NAR's responsibilities go to the public as well as the companies and agents that NAR represents. 

If buyers want to deal with a listing agent, so be it.  But they should do so only with an understanding of whom the listing agent is representing (hint:  it's not THEM).

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Team DiMuria, I don't think too many Realtors would disagree with you on that point.  It's unfortunate that NAR has essentially lost control of Realtor.com.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Anthony, what kind of incentives would you like to see Realtors offer buyers to encourage them to use buyers' agents in general, or a particular buyer agent?

I hope you see my response and give me your suggestions!

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Patti, I'm not a big fan of  "all services under one roof".  I think that many agents are pressured to encourage their buyers to use the in-house lender and title company, regardless of the relative merits of alternative providers.

And I certainly don't like, and have personally refused to participate in, schemes where the agent is providing their own mortgage services.  Not only is it a conflict of interest, it's quite likely that such an agent isn't providing the optimum mortgage service, experience and terms. 

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Debbie, you would think that NAR would be publically promoting representation for buyers as well as sellers, wouldn't you?  In spite of some of the reasons given in comments to this post, I still think it ought to be the case.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Michael, thanks for your comment.

Robert, exactly my point.  They don't know what they don't know.  And they could benefit from a campaign that at least encouraged buyers to consult a Buyer Agent and learn more about the subject!  

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
I don't know. I think NAR is focusing too much on the now is a great time to buy than anything else. But since they are advertising it, shouldn't it be now is the time to buy! Don't forget to be represented, have a buyer's agent. hehe.
Posted by Christy Powers, Pooler, Savannah Real Estate Agent (Keller Williams Coastal Area Partners) about 10 years ago
Brian, excellent discussion you have going on here. I agree NAR doesn't promote Buyer Agency very much. In MI we have a new designation called Designated Agency, it is when if the Broker has a house listed, but an agent has the buyer then both can keep their fiduciary responsibility to their client. All the offices had to vote to practice it. In Ann Arbor and all of Washtenaw County they do, but some areas in MI never understood it and don't practice it.
Posted by Missy Caulk, Savvy Realtor - Ann Arbor Real Estate (Missy Caulk TEAM) about 10 years ago

The answer to your basic question is simple. This is a commission driven business. NAR was founded by brokerages that understood the philosophy of "Buyer Beware". It has always been about controling the listings, knowing that buyers must come to the listing company if they are not better educated about the options that are now available to them, such as Buyer Agency. This old style of business as usual is designed to push as much business as possible to the listing company. That is what NAR was founded on.

NAR is all about numbers, large numbers of dues paying members. Without the support of large companies that focus on listings and getting the most out of the commission based business model, their numbers would drop, and their pot of gold would begin to shrink.

NAR has never really been supportive of any business model (such as unbundleing of services, discount brokerages, buyer agency) outside of the "listings are everything" type operations.

If NAR is to support ALL kinds of business models, the membership must speak up, just like you have done, loud and clear.

If NAR doesn't do that, then more of us need to write posts on our blog doing our very best to educate our local buyers of the advantages of the way we personally do business and our philosophies.

 

PS: I hope most of the words are spelled correctly, because once again some of the AR features have failed on the weekend, which has become normal lately. I just got this error mesage when I did the spell check:

'Could not execute AJAX call, server didn't return valid a XML"

Posted by ActiveRain City and State Listing Group about 10 years ago

Brian,
I completely agree and wonder who NAR thinks they are representing?  One of your responses says that NAR "sold us out to Realton.com", and I completely agree.  NAR has forgotten who they represent, and who pays them every year----and it is not a little payment, either.
Thanks for the great information
Gini Moran, Realtor/Partner
Keller Williams Realty
www.ginimoran.com
ginimoran.realtor@yahoo.com

 

Posted by Anonymous about 10 years ago
Christy, that would be an excellent way to combine NAR's present campaign with the idea of buyer agency.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Missy, this has been an excellent discussion.  In Pennsylvania we have designated agency as well.  It's an option for brokerages.  If elected it involves a firewall for protecting confidential information in both directions.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

Don, thanks for your thoughtful comments.  Many of us who represent buyers belong to brokerages that take listings.  We pay dues just like listing agents do - in fact as single agency practitioners, we may represent buyers or sellers at different times.  We pay our dues just like the listing agents do. 

Our own need for representation by our national trade association is just as valid as for any other Realtor!

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Gini, you're absolutely right.  See my answer to Don's similar comment just prior to this.  Our fees as buyer agents support NAR just like those of listing agents do, and many listing agents also represent buyers at different times as well.  NAR needs to be more in tune with the buyer agents in its membership.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Brian - When working with buyers, I find worker as a Buyer's Agent most rewarding because I can be more helpful and open,  I too agree NAR should do a better job promoting this designation.
Posted by Jennifer Fivelsdal, Mid Hudson Valley real estate connection ( JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571) about 10 years ago
Jennifer, if I'm working with buyers, I prefer buyer agency as well.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Lots of comments, Brian - great post!  I hadn't read this and posted something similar last week.  I also noticed that several other of my list of bloggers did too!  Could it be because of the rising spring activity and the wacky things we're seeing yet again when it comes to flaky buyers?  
Posted by Jeff R. Geoghan, REALTOR, Marketing Manager (Coldwell Banker Residential Brokerage) about 10 years ago
Thanks, Jeff.  Actually it was a comment by Lenn Harley on one of your posts that inspired me to expand on the topic!
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
A true representative for the buyer is a must, but many don't realize it. Irrespective of one's preparation & research, there are too many details to a real estate transaction that can leave a buyer vulnerable.
Posted by Stephen Graham (Inactive) about 10 years ago
Quite true, Jeff.  That's exactly what buyers need to be told, and NAR is in a better position than individual agents to spread the message.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Brian; great points about buyer's agency. My first five transactions in a row were as a buyer's agent-- and I still really enjoy repping buyers. It would be great if there was a national push in this direction, too-- but for now I guess we can push the benefits of buyer's agency in our local communities.
Posted by 0000 0000 about 10 years ago
Keishia, my first five transactions were working with buyers, too - but those were the days before buyer representation was available.
Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago
Brian - all things come in time - Buyer agency is something whose time has come. For now it is up to us to let the public know if that is what we want to be we ave an agent in our area who does very well working with buyers, promoting herself as a buyers agent.  
Posted by Kathy Clulow, Trusted For Experience - Respected For Results (RE/MAX All-Stars Realty Inc. Brokerage) about 10 years ago

Kathy, I agree that that's what we as buyers agents need to do.  Generating more general public awareness is a goal that our national and state associations could help us with.

Posted by Brian Schulman, Lancaster County PA RealEstate Expert 717-951-5552 (Coldwell Banker Residential Brokerage, Lancaster PA) about 10 years ago

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