Can I avoid or reduce Buyer’s Agent Commission?

[renterclint]

Hello all,
I am starting to look at buying a home in North SD, and I was hoping to get some advice on real estate commission. Is there a way to avoid paying a buyer’s agent 3% commission. I understand that the seller typically pays, but the buyer is really paying this through higher purchase price. I am not expecting a lot from my buyer’s agent, I already obsessively watch the market listings and have a good feel for home values in the areas I want to buy. I would rather not have a buyer’s agent at all, but I understand I’m required to have one for the home inspection? Thanks for any insight folks have on this.

[42nate1]

My wife and I have purchased multiple properties directly from owners without any agent on either side. Once a purchase agreement is signed & turned over to escrow, escrow does all the work. We live in San Diego, which is our target market.

It sounds simple, but it is not. The difficult part is identifying the property/owner & making initial contact to engage. If you can contact the owner, you may be able to make a deal. This strategy is further complicated by the low inventory. The owner knows that if the property is priced right, it will get multiple offers on day 1 of showing, and likely above asking price. Not a lot of incentive on the part of the owner to go through the effort to negotiate.

You need to identify a property that was priced incorrectly & has been lagging on the market. This may be a stubborn owner that does not want to lower the price.

The simplest way is to eliminate the buyer’s agent & negotiate directly with the seller’s agent.

Most of these strategies will fail. This is a numbers game so you need to mentally accept that you likely won’t get your targeted property.

It is mentally easier with rentals. We are looking at location, price & cash flow. We might put some effort into 30-50 properties before one becomes viable. That might translate into one property every 1-2 years.

If this is your primary residence, and you have found a property that meets all of your criteria & the price is reasonable, over the long-term, an amount slightly above your target price really won’t matter. It is a quality of life issue.

I would not consider these strategies for first-time buyers.

[FlyerInHi]

You’re not required to have a buyer’s agent. You can contact the listing agent directly.

I wouldn’t worry about the commission. Just negotiate the price with the listing agent.

However, If the you want rebate on the commission, the listing agent can refer you to someone who will act as your buyer’s agent and give you a rebate without conflict of interest. Just ask for a rebate.

Nate is right, you don’t need any agents at all. The escrow/title company handles the paperwork anyway.

[Author]

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