What is Buyer Agency?

This is a question I posed in ads around the region this week. I'm continually surprised that while Buyer's Agency has become virtually commonplace in other real estate markets, I still seem to be the only one offer Buyers this method of contractual protection in the West Kootenays.

So what is Buyer Agency? Well, basically, it's a better way to have a REALTOR work for you. Let me explain:

In an ideal world, every party in a transaction would be fairly represented. When it comes to real estate, however, this may not be the case. The seller and buyer, depending upon the type of agreement with the REALTOR®, may not be represented equally.

Example : You call an agent about a home advertised in a newspaper, a home magazine, or on the Web. The agent is friendly and informative. He or she tells you what you believe to be everything about the house. However, the agent represents the Seller, not you.

As this REALTOR® represents the Seller, he or she cannot reveal certain things to you, as the buyer:

• The reason for selling (unless the seller specifically authorizes it)
• Any concessions, in price or otherwise, that the seller may be willing to give up.
• Any conversations between the agent and the seller
• Any information that could be detrimental to the seller, or give you, the buyer, an advantage. This would include a CMA (Comparable Market Analysis) that could put the seller at a disadvantage.

But there is an alternative called Buyer Agency the Buyer gets the best representation possible.

When you specifically hire someone to act as your Buyer's Agent they commit to you and provide undivided, confidential representation. It is, in fact, their legal obligation to you. A Buyer’s Agent must work in a professional, ethical manner, ensuring the purchaser is treated with care, confidentiality, full disclosure, and accurate accounting. A buyer's agent will also show the buyer all available homes, whether their on the MLS system or not, and point out the property's features, provide financing information, and submit the offer to purchase. If a Buyer's Agency agreement is struck between you and the Agent, it is YOU, rather than the Seller, who has the representation from the Agent with whom you are working.

Working under the agreements of Buyer Agency, you get the following benefits:

Loyalty The real estate agent must act in the best interest of the buyer.

Professionalism The agent must act in accordance with the lawful instructions of the principle (buyer).

Disclosure of all material factors such as:

• Seller's financial condition
• Properties true market value
• Strengths and weaknesses of the property
• Commissions split with other brokers
• Legal effects of important contract provisions
• Information about property value trends that may influence your decision about a certain area
• CMA information. A buyer’s agent can develop a Comparable Market Analysis, revealing at what price similar properties in the area have listed for and sold for.
• Existence of other offers
• Relationship between agent and other parties

Dilligence Reasonable care and skill in:

• Determining and advising the buyer of a reasonable purchase price
• Discovering any facts that would affect the purchase of the home, and advising the buyer
• Ensuring all details and facts of the sale are correct
• Ensuring all money handled between parties is accounted for

Most importantly, you can ask a Buyer's Agent for advice and assistance in setting your offer price and structuring other terms of your offer. What's more, you'll have peace of mind knowing an advocate is working on your behalf to help you buy at the best possible terms.

The important thing is to understand your options, so that you don't unintentionally accept less representation than you want. When you are looking to make the biggest investment of your life, it is not hard to understand why it is important to be represented exclusively.

So before you call another REALTOR about one of their listings, call me to have a chat about Buyer Agency.