How hard would a broker really negotiate for a buyer???

Unfortunately, the buy-side broker has very little personal incentive to bargain hard for you.

Topper! HOW DO YOU KNOW???? that's an awful comment to make considering the fact that you are generalizing. There are some people are out there who are very truly passionate about what they do, and would ultimately do everything possible to represent the buyer.

I just negotiated over $1M off a property for my buyer. Sure, I would have made more if I convinced him to pay asking. However, he was very grateful and impressed and has already referred me to his friend. Negotiating in your clients best interest is not only the right thing to do but will gain their trust and confidence and likely benefit in the long run.

By, the way, I would have made another $20K if he paid asking...

exactly Rachel, for me, my client is my #1 priority, how can I possibly feel good about my self and my work if I do not give it my all?

Only a broker would brag about "saving" a client money by buying now, but forgetting to tell them that by waiting 6 months they would likely have saved another $1 million.

So to generate a commission for themselves now, they screwed their client out of $1 million.

And brokers wonder why they have such a bad reputation.

AR... I see you got deleted by the moderator.. what'd you say? Quickly so I can see b/f he/she deletes it again. :)
FWIW... me thinks the market negotiated a $1MM off, no? Did you ever get a $1MM off in 2006 or 2007?

So the logic goes like this.... malraux asks $100MM for his 2 bdrm in 15CPW (the market is $3MM let's say).. .you walk in and scream we will only take it for $3.5MM... malraux says okay... and you'd be writing I "negotiated" $96.5MM off for my seller and you state, had I made my client pay $100MM, then I would've made $20K * 96.5... computing ...computing...computing... DING! $1.930MM... :)

Does anyone else see the humor in that?

Rachel
"I just negotiated over $1M off a property for my buyer."
That is amazing. So it went something like this. Ask is 4.5mm Client negotiates a price through you and all agree on 3.7mm. Then two days later AgentRachel calls client up and says, hey, I got you another million off, lets print the deal at 2.7mm. Wow, you are good!

"Sure, I would have made more if I convinced him to pay asking"
If you can do that I wouldn't call your client a buyer, words like moron come to mind.

beat you to it... p09 :)

"Working for my client, I GIVE IT MY ALL." hahahahahaha

math major, no typing or english skills

hahaha come on, you guys are just mean :)

Just look at the compensation scheme - brokers are paid to get deals done at the highest possible price. That's how we pay them, that's how they work.

Hi, when I am the buyer's broker, I have a fiduciary responsibility to get the best deal for the buyer at all times. In this market, it makes sense to have a buyer's broker represent you since the market comps are all over the place with the turbulence in the financial markets and job losses. With that said, the brokers do not want to insult each other with lowball offers, but we have to present all offers to the sellers.

luis5: "the brokers do not want to insult each other with lowball offer"

Yo Luis, don't you think you are being a bit judgemental. If one is insulted by a lowball offer, ONLY ONE is insulted. However, by listing with a highball ask price, The WHOLE FREAKIN WORLD is insulted. I just have to much love in my life to allow that to happen. remember....I find that when I judge people, I have less time to love them. Maybe all the brokers should join hand in hand and march down broadway chanting, NO MORE HIGHBALL ASKS, NO MORE HIGHBALL ASKS! Now thats a parade I would go to!

In many cases, real estate transactions can be very emotional. This happens many times in situations involving starter homes or estate sales - so it is possible to "insult" people. However, the market is more of a buyer's market and I have seen lower offers being accepted.

"However, the market is more of a buyer's market and I have seen lower offers being accepted."

Duh! Do you think this guy is for real as a broker or just someone pretending to show how dim-witted they are?

Hey buddy, it's a friggin' crash and the prices are going though the floor.

Rachel--Are you legally obligated to represent the interests of the buyer or the seller?

bmw... she wrote something on me that got deleted by the moderator... she did it first :)

luis5ac... I don't understand people who get "emotional" about a financial decision. One time I offered $3K/month for a owner listed 1bdrm for $4K right b/f thanksgiving. I said if you don't rent in the next week.. it's gonna be 2 months etc... yada yada yada... dude said he was "insulted." Went off and signed another lease and two months later saw the listing drop $500/month.

I don't understand sellers that think oh I listed for $3MM but got $2.5... I lost $500K... no you friggin dumbass... you were paid $2.5MM, you didn't lose anything. :)

An Agent has a legal response-ability to the SELLER, the only way an agent can be working for a buyer is if there is a "buyers broker" agreementagreement. If there is a buyers broker agreement, the buyer would be paying the agent a commission...

hey w67, you are kind of a goomba, aren't you?

"I just negotiated over $1M off a property for my buyer."

SSNYC: Does this mean Rachel was working as a buyer's broker in this case?

SSNY is telling this post what the leagal relationship is between agent and buyer.

Negotiating "hard" is not how you would characterize a professional negotiator. Professional negotiators are trying to find solutions to optimize transactions for their clients, often by optimizing transactions on both sides. Where price is the sole objective other than obtaining the property, the only truly "hard" negotiating can be done by the principal to the transaction whose ultimate hard tactic is to walk which is only something that a broker can advise but never actually do.

Mandalay, I generally agree with your view point about negotiating. Afterall, the buyer decided to engage in a negotiation for a particular property and the buy broker simply advises what, and how, to bid. I suppose the question is....how often is it that a broker looks their buyer in the face (or through email, phone, etc) and says....This apartment is not worth what they are asking or what you are thinking of bidding and here are my reasons why....let's walk away and wait for another suitable property to come along.

Or, just as brokers were so willing to point out potential price appreciation, how often is it said "This market is still headed lower. If have 20 listings that aren't getting any notice and sellers are considering major price drops on them. If you need the apartment, here is the best way to get it, but waiting further is the right tactic."

I want a broker that gives me the real inside scoop on others seller's mentality by offering their pearls of wisdom from what they are seeing with their other listings. I want to hear more about what the sellers are thinking. I want a truly realistic view with high quality information. I suppose that the broker's fiduciary responsibility to the sellers makes that an impossibility. They'd be defying that trust.

Therefore... I'm truly skeptical.

By the way, it is not my intention to be mean-spirited about this issue. I'm simply trying to identify potential imbedded conflicts of interest that would prevent me from maximizing a purchase.

walterH,

I see your point but prices are not that flexible. There is an "ideal" price for most apartments, which can be mathematically be figured by running comps (as a rough start, one takes the average psf price that that type of real estate in that sublocation is trading for).

As a seller's broker, you are trying to get that ideal price (or a shade over) as quickly as possible for your seller; as a buyer's broker, you are trying to get a shade under that ideal price for your buyer while making sure that they you have delineated the risk of that particular property, and that that buyer is comfortable with whatever the specific risks are.

But the swing of actual trading price from the idealized price, at any one time, is probably on the order of 10% each way. It's not 20%; even if you are a great buyers' broker, you're not going to get an apartment that "idealizes" at $1,000 psf for $800 psf. The market is more efficient than that. There are too many other people involved in the transaction -- usually including a lending bank -- for prices to swing that wildly.

So as a great buyer's broker, you can get your clients into the "right" property, save them a little money, and keep them from overpaying for the "wrong" property -- those are all boastable achievements. But you're not, by doing those things, actually moving the market enough to significantly impact your activities on the sell side.

As far as fiduciary duties, a broker is rarely on the buy and sell side of the same transaction. When you are, you instruct the buyer that you are an agent of the seller. If a buyer is willing to work with you anyway at the point (and sometimes they are, I just did a direct deal in SoHo) it's that they feel reasonably comfortable with the price point that the property is clearing at, and trust their lawyer to counsel them on any major risks.

ali r.
{downtown broker}