Is buyer's agent necessary?

I bought 3 years ago and also found my own apt. I used Keith Burkhardt as my rep. His firm shares his 3% commission with buyer. For this, his team ran comp search, suggested bid and negotiated with seller's agent. He and his team also put together my board package, which is labor intensive. At closing table he handed over a substantial check to me. Why would you go it alone when you could use a service such as his and end up with a nice check> To go it alone means that you are giving seller's agent entire 6%. Check out all the previous posts on this question and on the Burkhard Group. Best of luck

Yes, you should spread the love! The main issue is whether or not you want the seller's agent to represent you and the seller at the same time and if you think he/she can negotiate on your behalf when they are also representing the owner. That's an answer only you can give. I represent a lot of newer buyers and believe I add value... if you're an experienced buyer you may not need one, but even then it's likely that the buyer's agent could find out some information that will make your offer stand out.

Best

Unfortunately, the way the broker commission is structured, you get no benefit of going it alone (even though you found the apartment yourself and did all the leg work on your own). The seller typically pays a 6% broker commission to be split between the seller's broker and the buyer's broker. If the buyer doesn't have a broker, you would think you'd be able to use that to reduce the purchase price accordingly (i.e., have the seller only pay the seller's broker a 3% commission and reduce the purchase price to you by 3%). Unfortunately, it doesn't work that way, and the seller's broker will keep all 6%, and you won't see the benefit. I recently used Dan Gotlieb from Digs Realty because he offers a huge commission rebate, which reduced my purchase price by 2%. Aside from the money back at closing, Dan was amazing to work with. He was totally responsive, knowledgable and incredibly helpful throughout the whole process. Before I made my offer, he gave me a purchase price analysis, comparing the unit to others in the neighborhood, getting me comfortable with my ultimate purchase price. I think his background as a former real estate attorney also really helped in the negotiation process (I know he was able to get a better price for me than I would have if I was negotiating on my own). He put me in touch with great referrals along the way as well, making the entire process seamless. I highly recommend him and the rebate broker model.

What's with all this self promotion in the form of false testimonials? The real answer depends on if it's a hot property or not......if there are multiple offers the listing agent will do everything in their power to go with the buyer that's direct and not co-broked as they will get double the commission in most cases. That's the reality of the situation.

not the case at all JMHunt. Aside from the fact it's illegal to not present an offer, any broker with an interest in building a career won't destroy the relationships with other agents. You might be right for one off listings out in the less expensive areas of Brooklyn & Queens, but these days most listing agents do a lot of business on the buyer side.
Do you really think that members of the real estate industry are going to make the real estate industry less effective?

The real competition are the disruptive companies like Compass and Suitey, not real estate agents.

JMHunt, I know brokers who prefer to work with a buyer who has an experienced agent versus one working on his own. The deal is more likely to close when the buyer has a rep handling the negotiations and the board package.

snezanc: It's illegal not to present an offer but is it illegal for a listing agent to wait two days before they return an email or phone call requesting a showing only to say there's an accepted offer on the unit listed just two days prior?

REMom: Yes, some seller's brokers, including myself, would prefer another agent handle the buyer in a co-op purchase.....I'd rather sit back and have them do all the work and split my commission. My example is on a hot property, most likely a condo in a desirable building where buyers are lined up.....going directly to the listing agent has it's advantages. That is the reality.

if its a bidding war , the reason more to have buyers agent. If the agent knows what he si doing , he can help his buyers become the buyers of choice. It is very important to know how to present the offer and how to correctly present the information in the financial statement. Besides that , a lot of agents know each other , so you might benefit from a personal relationships that your agent has. The sellers agents who are doing everything to get a double commission are very shortsighted and they are definitely not the successful ones.

Thanks for this thread. I’ve been wondering the same thing … and I see many others have as well, but this is the only one that’s really gotten responses, so I’ll add on here.

I’ve been looking for an apartment for a few months without using a broker. It’s been a mixed experience, but I’ve also tried working with one too, and that was relatively negative.

That broker kept sending me stuff I wasn't interested in, and kept trying to push me into an apartment - any apartment. I understand - the faster she gets me to buy, the more quickly she makes her money. I got tired of making arguments of why I didn’t want to buy this one and that one to her, and she got tired of me arguing back.

She also got mad at me for attending open houses on my own, because then the seller's broker would argue that she didn't deserve the commission. But I was hardly going to route all my appointments through her, add on an extra layer of bureaucracy, time and delay, to help her keep her commission.

I don't blame her, really -- it's the incentive structure.

In interviewing another broker, she boasted that with her connections, she could get advance word on showings. But this seemed to be a bit of a red herring as seeing a place early doesn’t mean the buyer isn’t going to hold out for the highest offer.

On the other hand, I'm finding I do need a broker for some things, like helping me make sure a bid is reasonable by helping to assemble comparables, and knowing how to follow up and move through the process, so I can know what the timeline is like and how to pass the board.

I'd be willing to pay for this, but 3% seems quite exorbitant. I’m going to look into the brokers with rebates as listed earlier in the thread.

I also noticed someone earlier in the thread mention Suitey and Compass. I looked at Suitey, and that might be what I need. Indeed, the site boasts “financially aligned agents.”

However, I could not find any reviews on Suitey. They do have a Yelp page with a lot of positive reviews, but an overwhelming number of those reviews are written by people with no friends, which suggest shills to me. I could not find anything on Compass.

Baier, Compass no longer offers any kind of rebate or discount. They follow the standard brokerage model, albeit one with VC funding.

I think rather than looking for a rebate model, I recommend you spend a little more time vetting and interviewing buyer agents. You said it yourself, 3% (or 2.5 or 2 since there are lots of different splits) is quite a bit of money and shouldn't you be choosy with the agent.

How about this, reach out to some of your friends and colleagues that have recently bought a home and ask if they have a buyer's agent recommendation. I think you'll find one or two candidates that will respect your choices and give you the space to come to a decision on your own and can help you craft the offer that will really stand out. The key component of this is collaboration and communication. I will know all the tricks that will put our offer over the top and you will tell me when is the time and express your limits.

I would only interview buyers agents who offer a rebate. Great service and a five figure check are not mutually exclusive. Cannot imagine why anybody would turn down the latter.

Keith Burkhardt and his team did an excellent job for me.

Baier, you wrote: "I'd be willing to pay for this, but 3% seems quite exorbitant. I’m going to look into the brokers with rebates as listed earlier in the thread."

You are not paying 3% or any commission to anyone unless you get sucked into signing a Buyer's Broker Agreement which states such. The seller pays the commission.

a buyer's broker is a free service. Why would you not use a buyer's broker? Just be loyal.

And can someone stop Keith Burkhardt from advertising him firm ALL over StreetEasy? It's tacky.

it may be tacky Jared....but 2% rebates can add up to some serious coin.....

Keith has been a valuable contributor to this board for years. He is promoting a service that is vastly different from the industry norm, and there have been numerous testimonials to the quality of his service. Go after the agent who announces a new listing or an open house, not someone who is trying to revolutionize how real estate services are provided and the value they provide in NYC.

jared -- people recommend Keith because he adds value that the typical broker doesn't. What do you do for your clients that sets you apart?

I worked with Keith Burkhardt for six years. He is 100% legit. Buyers get great service, and a big check on closing day. It's that simple. The testimonials you see here are real.

I've taken a break from real estate because my day job and my family took precedence. If I eventually return, I hope to resume my collaboration with Keith.

By the way, The Burkhardt Group recently joined REBNY after years of deliberation. Membership is undoubtedly a plus for Keith's clients. As long as REBNY maintains its stranglehold on prime Manhattan, agents operating outside its walls will remain at a disadvantage.

Jared, loyalty, really? I'm loyal to my brokers, but it's because I know them over many years. I wouldn't hesitate to drop an asshole.

Have known. Damn.

I am humbled by the kind words! As I always say, it's not one size fits all however we are happy to have been able to offer a service that many buyers have been looking for. We are just one of many well qualified brokers/agents out there...We do feel strongly that competition must be allowed unencumbered to benefit the consumer and ultimately our industry. Just as alternative ways to buy stocks, travel, insurance etc have changed and provided efficient, cost effective results for the consumer. I have been interviewed twice by attorneys at the NYS AG's office and I can assure you they feel the same way.

Keith Burkhardt
The Burkhardt Group

I have always had my own broker, but perhaps one of the experts can clarify: it was my understanding that regardless of who may have brought the brokers to the table, the seller or the buyer, technically both brokers technically work for the seller and have certain obligations under law to the seller. As oppossed to the buyer hiring a lawyer and paying his fee directly.

https://www.dos.ny.gov/forms/licensing/1735-a.pdf

Keith Burkhardt
TBG

https://www.dos.ny.gov/forms/licensing/1736-a.pdf

Fore buyers/sellers

Keith Burkhardt
TBG

Sorry, thought I was playing golf..."for".

LOL, Keith, Florida will do that to you.

NYC511, the law of agency is really complicated, and I'm not an attorney, so I'm not going to attempt to explain all its convolutions; but as brokers we are taught that agency follows intention, not money. Thus even though a buyer's agent is generally paid by the sell-side, he/she represents the buyer because the buyer says so (you can see that the words used on the disclosure form that Keith linked to are "engaged by a buyer.")

As an added point, even though you may be an agent of one side, in addition to your duties to that side you have duties to the other side -- for example, if you're a buyer's agent you still have a duty to disclose material facts to the seller that might impact the seller's decisions. So a salesperson or broker is always juggling duties to their side (such as loyalty and confidentiality) with duties to the other side (such as an obligation of honesty -- the need to disclose material facts that might impact the deal.)

ali r.
{downtown broker}

I am a licensed Real Estate Salesperson, my colleagues might very well find my comment not too pleasing. In Real Estate EVERYTHING is up for negotiation! I mean everything. Why not try to negotiate a discount with the Listing Agent?

I disagree with all comments that claim that the experience of a buyer's agent when it comes to negotiation or board packages is worth 1 or even 2% of the purchase price of any apartment in Manhattan. Sorry, but these skill sets can easily be learned online or by watching videos.