Value of a Buyer's Agent

This month let’s talk about the value of a good buyer’s agent representing you. 

First, we call buyer representation ‘buyers agency’, and that is where you hire an agent to work for you and your best interest in a transaction. It means that they need to work diligently, honestly, and keep your information confidential (except that which you allow them to share). I will say that a good, honest, hard-working agent will do these things anyways, but agency protects everyone. 

It is important to remember that without agency, if the agent (or their office/team) is also working for the seller of a property, the only one they have agency with is the seller and things you say may not be protected - which could hurt your negotiating power. Buyer’s agents work hard to find their clients just the right property, whether on the market or coming on the market, so having an agent on a team or in an office with other agents can be to your advantage. 

Buyer’s agents put all their time out upfront gathering information, showing properties, negotiating offers, negotiating inspection contingencies, looking over title work to make sure you’re protected, staying in touch with lenders to make sure everything is on track, making sure contract details are handled, such as septic, pumping or survey, etc. They only get paid if your transaction makes it to the closing table. So next to you, they are probably the most vested person in making sure you get it closed. 

If you choose an agent with a Transaction Coordinator, not only do you have the agent but also another (generally licensed) professional helping get your transaction to closing.

South Dakota has had buyer’s agency for a long time so it was way ahead of other states when the National Association of Realtors ruling came down a couple years ago addressing the subject. In the buyer's agency agreement, you agree to how your agent will be compensated for their work. Generally in our area, the sellers still will offer buyer’s agent compensation, so you can authorize the agent to ask for that in an offer. It is addressed in every purchase offer now, which makes it very clear that it is a negotiable item. If a seller will not compensate a buyer’s agent, then you will need to compensate your agent for their work, per your buyer's agency agreement. 

Remember, your agent has invested time and money in getting licensed, continuing education, national/local NAR dues and MLS fees, insurance, and puts all their time and money out up front, all while generally being on call for you (within reason) 7 days a week. They also have to split their commission with a brokerage or pay for rent, utilities, transaction coordinators, etc. themselves.  

A good buyer’s agent makes all the difference in the world.