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Understand the Real Estate Game

Understand the Real Estate Game - Home Buyers

Purchasing or selling real estate can be an emotional experience with major implications on your life. You can best protect yourself by making sure that the experts you are depending on (real estate brokers, attorneys, accountants, home inspectors, etc.) are obligated to work in your best interest and that they will commit to this in writing.

Protect yourself by interviewing agents. Make sure they all provide you with agency disclosure. Agency disclosure defines what role the broker will play, should you decide to work together. This disclosure is now required by law in nearly every state, and it should be discussed prior to your revealing any confidential information to a broker.

As a buyer, you have the option of working with seller agents or buyer agents. Be an informed consumer and know the differences in services offered.

Real Estate Games Brokers Play With Buyers - Beware!

Game One - There are agents who avoid making agency disclosure until just before the buyer is ready to make an offer. The buyer then realizes that the agent who so cheerfully assisted him is a seller's agent. This agent must by law negotiate in the seller's favor and disclose information about the buyer to the seller that would enhance the seller's negotiating position.

Game Two - There is another more subtle game. In this case, a broker will reassure you that a buyer doesn't need his own agent because all agents are obligated to treat the buyer and seller "fairly." This type of broker gives the impression that he is a middleman who is protecting both parties. During the search process, this type of agent will act as though he is sharing inside information with the buyer, and he may actually disclose information he shouldn't. This behavior is undisclosed dual agency and it is illegal in every state.

Game Three - You may encounter an agent who points out that buyer representation will "cost extra." If buyers think about this argument, it doesn't hold up. In terms of time, expertise and negotiating power, a buyer will almost certainly save money by using an experienced and professional buyer's agent, a fact that is supported by recent studies.

Game Four - Another common game is for agents to give you the impression that a buyer cannot talk directly to a seller. There is absolutely no reason why a buyer or seller cannot talk or negotiate directly. Obviously, they cannot eliminate the brokerage fees by doing this, but they certainly are entitled to communicate with each other if it is mutually agreeable.

Game Five - Although it's not common, there are agents who will tell a buyer they will not submit the buyer's offer. This is illegal. All offers and counter-offers must be presented.

Game Six - There are agents attempting to represent buyers when they are not qualified do so. If you hire an agent to represent you, determine if he has the expertise and knowledge about the area and category of property you want to buy. He should be willing to provide you with references and demonstrate why he is qualified to represent buyers.

Read Games Brokers Play with Sellers

 
 
 

Latest from the Blog

  • Closed Home Sales Down in April After Record Inventory Lows and Rising Prices

    Median Sales Prices Have Seen Year-Over-Year Increases for 19 Straight Months

    WALTHAM, Mass. – May 23, 2017 – The Massachusetts Association of Realtors® (MAR) reported today that low inventory and rising prices caught up to the spring market, with single-family home sales decreasing over eight percent from this time last year. Both single-family and condominium prices saw a hike. Condominium sales decreased almost 10 percent from April 2016.

    April Closed Sales:

    Single-Family April 2017 April 2016 %Change
    Sales 3,735 4,082 -8.5%
    Median Price $362,500 $349,900 +3.6%
    • Closed sales have been down for four out of the last 12 months
    • Median prices have been up or flat for 16 out of the last 17 months
    Condominium April 2017 April 2016 %Change
    Sales 1,455 1,607 -9.5%
    Median Price $345,000 $329,950 +4.6%
    • Closed sales have been down for four out of the last 12 months
    • Median prices have been up or flat for 16 out of the last 17 months

    “With the current trend of plunging inventory and rising prices, the odds were strong that sales increases of the winter market would be unsustainable through the spring,” said 2017 MAR President Paul Yorkis, president of Patriot Real Estate in Medway. “The demand is there; we just need more homes on the market to satisfy that demand.”

    Inventory and Days on Market:

    Single-Family April 2017 April 2016 %Change
    Inventory 13,234 19,392 -31.8%
    Months of Supply 2.7 4.0 -32.5%
    Days on Market 81 107 -24.3%
    New Listings 7,706 8,513 -9.5%
    • 62nd time in the last 63 months of year-over-year inventory decreases
    Condominium April 2017 April 2016 %Change
    Inventory 1,455 1,607 -9.5%
    Months of Supply 2.0 2.8 -28.6%
    Days on Market 60 78 -23.1%
    New Listings 2,640 2,971 -11.1%
    • Inventory down for 16 out of the last 17 months

    “Unfortunately, our existing level of inventory makes it hard for us to meet our current and future housing needs,” said Yorkis. “If we don’t do anything soon, it will have a negative impact on the entire Massachusetts economy.”

    If you are thinking of buying a home anywhere in the state of Massachusetts, it is in your best interest to work with a member of the Massachusetts Association of Buyer Agents. These men and women are dedicated to working exclusively on your behalf to ensure that you have the best possible home-buying experience. Find a MABA agent here.