Sunday, May 4, 2008

Buyers Behaving Badly

Many of us have discussed how the current business model for real estate agents is poorly suited to a buyers needs (for suggestions on how to change it). However it can be a double edged, and doesn't always work out for the RE agent either.

I was rather saddened to hear of a situation from a mom I know, who has been showing a particular client many homes. She typically did this on weekends, even though she would rather spend time with her daughter. She had even written an offer on a short sale and was still waiting to hear from the bank. However at our last play date, she mentioned that they had been using several agents, and ended up having an offer accepted with a different agent.

While I can understand taking an agent for a test drive or two (one or two showings), but stringing along several agents, without any compensation for their time is very naughty (can you tell I have two young kids =).


sacramentia said...

It is in the buyers best interest to use several agents.

I never understood why agents don't get an exclusive to represent for a 30-90 day period before spending time and money. It is a standard RE form in the toolkit.

That sucks for your friend - it is no fun to lose.

smf said...

"I never understood why agents don't get an exclusive to represent for a 30-90 day period before spending time and money."

That is what our agents did.

But then again, they have 'experience'.

Way too many amateurs out there that are not and will not get used to this normal market.

Buying Time said...

Well, she learned her lesson for the next time. I really try to keep my RE opinions to myself when hanging out with her (and almost everyone else for that matter)....cause I already had the feeling they were jerking her around.

Not sure I agree with using multiple agents. It only seems right if they know you not in a monogamous relationship with them =)

I feel incredibly uncomfortable for bailing on the mortgage broker I had initially used (through a a really shady guy I later found out).

Most will argue its a marketing expense, regardless I tend to feel a strong sense of obligation when dealing with actual people (but not corporations).

AgentBubble said...

Personally, I use a Buyer Representation Agreement only when I don't trust the buyers I'm working with, which is very rarely the case. I think I'm a good judge of character and I'm picky on the buyers I will represent, and have no issues telling people I think their needs would be better served with a different agent. I just did it 2 weeks ago with some people that I knew would either a) waste my time or b) end up calling the number on the sign instead of me first. And these people were referred to me by past clients!

I've been burned one time in 10 years using this approach, and it was because I was green and didn't know better. I showed a couple about 60 homes, and they ended up buying new without me.

Just tell your friend it happens to the best of us, and she can take away a valuable lesson that will probably not be repeated.

Paul said...

A "test drive" of a RE agent to find out if you are on the same page, is fine. If not, move on. Anything else is just plain rude.

I have no similar loyalty to loan brokers. They are selling a fungible commodity. It is no different than shopping Circuit City vs Best Buy. For an informed borrower, the financial terms should be identical from broker to broker. Assuming that all prices are equal,what really matters is the broker's professionalism and integrity. I have done business with one broker and came into contact with another, each of whom would absorb the costs of their own mistakes, before they would pass them on to borrowers.

smf said...

I vouch for agentbubble's integrity again.

He was 'almost' our agent, and ultimately his idea was implemented and allowed us to (almost) get the house we wanted.

Closing day is coming up quick!

As to buyers behaving badly.

They have for years, one reason we are in the mess we are.

Ron Jensrud said...

Although "Test Driving" an agent is fine. It is NOT in the Buyers best interest to work with Multiple Agents.

If a Buyer is working with several agents they won't have an advocate in their corner at all times.

Because depending on who's listing is being shown to the buyer - this will determine if the agent is working for the Buyer Agent or is a Dual Agent.

Whenever the agents shows the buyer one of their own personal listings or a company's listing - That agent must change their loyalty hat to Dual Agent and therefore MAY NOT advocate for the buyer.

Although a little better, BUT NOT the best is when the agent shows the buyer a home that is listed by another company and in this situation the agent MAY advocate for the buyer.

However, the best option for the buyer is to work with an Exclusive Buyers Agent, a real estate professional from a real estate company that only works for home buyers - Never sellers.

In this scenario the buyer would have representation and protection on ANY home they want to purchase REGARDLESS of which company has the home listed.