Buyer’s Agents: Do They Give Homebuyers a Competitive Edge?

The real estate market has experienced an interesting year and a half. Very low inventory due to sellers holding off and extremely high competition exhausted buyers and led them to question the whole process. Some have even wondered if working with an agent is actually helpful, that perhaps skipping the buyer’s agent and working directly with the seller’s agent is a more efficient way to get the house they want.  Maybe the seller’s agent will prefer them over other buyers and take their offer.

Will working directly with a seller’s agent help a buyer?

The short answer is NO.  Skipping out on proper representation during the largest financial transaction of one’s life is not advised.  The long answer begins with one main point.  The buyer’s agent is there to protect the buyer’s interests and goals and without that protection, they’re vulnerable.

As buyer’s agents protect a buyer’s interests, seller’s agents are there to protect the seller’s interests with the main goal being to get the seller the most money for their home.  Buyers that go directly to the seller’s agent risk paying more than if they use a buyer’s agent to help negotiate the price and terms.  Not only could the buyer pay more, but the terms of the deal could be negotiated to the seller’s benefit.

At the end of the day, the strongest offer will be taken

It has been a seller’s market for over a year and any homes have been sold in multiple offer or bidding war situations.  Though the common conception is that the highest offer will always win, it’s not always the case.

If the seller’s agent is experienced and truly has the seller’s interests in mind, sometimes a lower offer will be accepted if it is the strongest one.  A buyer with an expert buyer’s agent will likely provide the strongest offer to a seller because they’ll be prepared.  The buyer’s agent will make sure that the buyer has a strong pre-approval letter, is working with a qualified lender and real estate attorney, and the seller’s agent will feel assured that their offer is iron clad.

You’re not just working with an agent, you’re working with their team.

It can come to pass during negotiations that a buyer needs a lender to go to bat for them.  The connections a buyer’s agent has will ensure the buyer is working with the right lender for their financial situation.  Sometimes, a call from the lender to vouch for a buyer will make a seller’s agent consider their offer further.  As well, when the terms of the deal are being reviewed, a real estate attorney will safeguard the buyer’s interests and make sure the contingencies align with a suitable timeline.

Hiring a buyer’s agent will save a buyer money.

Let’s say it another way.  Not hiring an agent will likely cost a buyer money.  If a seller’s agent feels that the buyer’s agent is reliable and pleasant to work with, it can go a long way in a multiple offer situation.  Experienced buyer’s agents know how to effectively communicate with seller’s agents which can make their offer more attractive than other strong offers.  For example, if another buyer has a slightly higher offer, but their mortgage broker is notorious for doling out weak pre-approvals, and their agent has a terrible response rate, the seller’s agent will probably recommend that the seller disregard that offer.  Now the buyer with the better agent will save money because they won’t have to go further and outbid that other offer.

Buyers aren’t saving money by diving into this process alone, it’ll only cost them.  A good buyer’s agent will make sure that they’re getting the right house for the least amount of money.