Buyer's broker

It's a tough thing - and this is NOT a 'let's slam brokers' comment. Having bought and sold a number of units over the years in Manhattan, I would say the best way is probably to talk with your friends and relatives who have purchased units in NYC recently (hopefully in that price range) and get recommendations. If you do decide to just 'wing it,' at the very least once you DO decide on a broker, get three recent references from them and CHECK OUT THE REFRERENCES in depth.

I agree with the previous poster. I used a buyer broker in the past whom I didn't really check out too much and got burned. A buyer's broker is supposed to look out for the best interest of the buyer, but in truth when there compensation is tied to the selling price of the property they are ALL working for the seller. I absolutely could have done a better job negotiating the deal and making sure that my best interests were being taken care of. If it is your first time making a real estate purchase I would definitely have someone to consult with, but I would be careful in who you choose.

Can you tell us how you got *burned*? It'd help to look out for those things?

Is a broker really needed if buying directly from a new development? And would they be willing to negotiate on the price further since you they're not splitting the broker's fee?

I was poster number 2 above. Another thing that I think is CRUCIAL (even before you find a broker) is locating a good lawyer who to a greater or lesser extent specializes in Manhattan residetial real estate closings. The reason for this is, that even once a deal is 'brokered,' the real people who close the deal are the lawyers. They negotiate back and forth on the details, and more often than not, a lawyer inexperienced in handling a residential real estate negotiation can blow a deal (and a good, experienced lawyer can definitely SAVE you from things your broker may not even know about!). It's also important that you do NOT get a suggestion for a lawyer from your broker! Your lawyer must work for you, and you alone, in your best interests, and not have any undue conflict of interest. I have seen a broker and a lawyer working independantly for the same client come to loggerheads more than once, but as long as both are doing their job well, that's nothing for the client to be upset about - you're paying (well) for both of their respective experience and expertise, and you should be happy getting two (possibly different) pov to consider when you're about to lay out a lot of your own hard earned money.

"I have seen a broker and a lawyer working independantly for the same client come to loggerheads more than once"

Over what?

Poster #2 from above, again. I think in the case of a brand new development, a broker is useful in two areas. First, some (not all) brokers know about new developments even before they hit the public. In these cases, you can get first choice of whatever unit you may want (and can afford!), and this is sometimes an amenity worth paying for - if the broker really is that connected. Secondly (but to a lesser extent), a broker can help with all the issues of a comparative market analysis - but that's only if you're simply too busy (or lazy) to do the work yourself. Some people are happy to pay for that.

But the REAL trick, in terms of new developments, is a super-duper top-notch real estate attorney. Why? Because some attorneys specialize in writing all the offering plans on all the new developments going up. And those lawyers are privy to all the new offering plans hitting the market, many times even before the brokers. If you work with one of these attorneys, they know you're going to pay them anyway when you buy a place eventually (because they'll be your lawyer for the deal), and so some of these specialists are only too happy to share the advance news with you. That's how my wife and I bought our place. We really wanted to live in the Village, and wanted a top floor unit with a wrap terrace. One day, our lawyer called me and said - "You know, I'm writing an offering plan right now for a new development in the Village, and there's three units with terraces. Why don't you call the builder/developer, tell him we spoke, and see what's up?" Five minutes later I called the developer, and two hours later I was at his office looking at floorplans. Clearly, one of the three terraced units was superior. I had him hold it for 24 hours, went home, showed all the paperwork to wife, and that was that. We're moving in to that unit in about 90 days. If we had waited for that to come to market, it would have been snapped up before we would have even had a chance.

Brokers and lawyers....

Well, think of it this way. Once your broker (assuming you're the buyer) and the other broker agree to your tendered offer, the lawyers step in. Now, at this point, the brokers would ideally like to close the deal as soon as is prudently possible - they have no reason to want to prolong the boring legalities, if at all possible. But here comes your lawyer, whose first job is (if they're doing their job) to review the house rules, amendments, minutes of at least the past year, and the past two or three year's building financials. Now all of that, in itself, can dig up problematic issues that require resolution. Is there a flip tax? How much? Who pays? Is the building a land lease? How old are the various building systems, and what is there condition? How's the roof? The facade? The windows? The previous owner had a storage space in the basement - is that grandfathered to your unit legally, or not? Assuming the building's financials are sound, and the meeting minutes don't suggest any big financial assessments are coming, the house rules (and amendments) are amenable to your lifestyle, then you move on to negotiating the specifics of your unit. Do the appliances stay? The window dressings? Any furniture? The light fixtures? The bathroom fixtures? There's ALOT of details to negotiate, and many things can create problems.

The lawyer is dong their best to carefully review ANYTHING that could be problematic for you down the road, and the brokers are simply trying to close the deal. And that's how things can get testy.

Does anyone know where to check on a broker's stats? Complaints, etc. Thanks!

Make sure your attorney sends YOU copies of board meetings, at least two years
coop financials, some will say they did "due diligence" without really doing it.

Do NOT use an attorney that your broker wants to hook you up with. Make sure
the apt will appraise at value, do not trust broker saying it will, otherwise you might
have to come up with a lot more cash than you thought.

If apt has been remodeled you better check to see if licensed
electrican and or plumber was used to avoid later expense of
correcting bad jobs.

Do not trust broker, talk with other people renting in building.

Buyer's brokers are becoming more irrelevant by the day. As more and more information becomes increasing easy to obtain (i.e. streeteasy.com), buyers can educate themselves much more easily than in the past, and therefore can do most of what buyer's brokers were once needed for. Indeed, brokers can see listings before they become readily available, but in today's market, how many apartments are scooped up before they are even listed?

Also, if a buyer works sans broker, that buyer will certainly be more attractive come offer time to the seller's broker because they won't have to split any fees. And, brokers, save your breath if you want to tell us its unethical to favor one buyer over another simply because the first buyer is not represented. You know you do it.

Bottom line: in most cases, if you do your homework a buyer doesn't need a broker, and is likely better off without one.

I didn't use a broker, and I'm happy with the outcome. Your mileage may vary.

so the question is...is there more leeway in negotiating price if there is no buyer's broker?

50% leeway

comission gets split 2 ways, rather than 4

I would not use a buyer broker, just a good real estate attorney.
He does all the paperwork anyway.

If you're new to the market or a first-time buyer it might be a good idea to use a buyer's broker - one you feel comfortable with and who's well-connected - to get a 'feel' for the market and other intangibles. If they're good they'll steer you in the right direction, ie bldgs that have boards that would meet your criteria (i.e. pets, parants as guarantors, easy reputation, etc.), stuff that you may not be able to find out using streeteasy. Also can be helpful when going through the board approval/appliation process.

My agent was very helpful because I was dealing with a seller's agent who was unethical and could have totally taken me for a ride.

I feel I have enough knowledge about buying RE in NYC that next time I may go it on my own, depending on how hot the market is at that time.

I wouldn't recommend a buyer broker even for a 1st time buyer or new to the market.
They still can steer you in the wrong direction. Best to do research on internet
sites, visit open houses, find a good Manhattan real estate attorney and have him
submit your offer.

A little over a week ago the NY Times had a story called, 'Agents of Angst', which went into detail on how real estate agents are a step below used car salesman in terms of reputation.

I agree that having one less broker in the mix will make your life easier assuming you are willing to do some of the "administrative" work a buyer's broker will do for you like make appointments, follow-up on additional requests, research availabilities and comps, etc. It certainly will introduce more price flexibility (to the tune of 1-3%) into the negotiations. Importantly not having a buyer's broker will allow you to control all of your "non-public" information, like the highest price you are willing to pay, the amount of mortgage you can afford, your level of interest in a property, etc. Meanwhile, you will still have access to seller's "non-public" information through the listing broker, who will nearly always tell you who your competition is, why the seller is selling, how motivated they are and the history of previous offers.

Don't tie yourself down with a broker, they make it harder to get a good deal and easier to get ripped-off.

We did our own scouting and found something wonderful. The only use for a buyer's broker is for leads to apartments not yet listed. That could be critical, of course, for rare finds. But if you're the type of person who can check twice daily on the internet--both major sites and agencies specialized in the neighborhood/s of your choice--you should be able to track what's coming on the market.

If you like a building, talk to the doorman and give him some cash.....
You will know before a broker, when an apt is going to be sold.
Doormen & Attorney your best bet!

We got screwed twice by brokers last year. First on listing property, sold first day
(broker recommended selling price was too low) and thats after we had her increase price above what she thought it would sell for. Then bought a property and it didn't appraise
at contract price (broker said it would, no problem), so we had to make up large cash difference or lose 10% down payment.
Best if you do your own research and not believe what they tell you.

To above poster, if the property doesn't appraise at contract price, do you really lose the down payment??

it depends on whether you have a 'no mortgage contingency' clause in your contract...

If you don't have a appraisal/mortgage contingency in your contract. While this kind of contingency was quite standard even 5 years ago, they went the way of the Dodo during the recent unpleasantness (and I am sure any buyer's broker will advise you not to include one so as to have a stronger offer).

With the current market softness, I think it is becoming easier to get this contingency into contracts.

Does anyone believe that using a buyers broker lessens your chances in a competitive bidding procees ie selling broker is incetivized to show only bids from un-brokered guys?

Absolutely!

Thats why its important to find your OWN attorney that will look out for your interests.

Using a recommended buyers broker attorney is NOT a good idea at all, they will
be looking out for each other, not for you.

Once the seller has your 10% cash downpayment, good luck getting it back... :)

Worst thing you can do...
1) Use Buyer Broker
2) Use Buyer Broker recommended real estate attorney
3) Use Buyer Broker recommended mortgage Broker
4) Use Buyer Broker recommended Appraiser
see where this ends up?

I can imagine that you can get good info on a building from a doorman but how many people actually confide in them - 'the doorman will know a unit's for sale before a broker' from above. Any feedback?

All comments regarding buyer's brokers make a great deal of sense. So assuming I go it alone and approach doormen what's the best way to handle this: slip them a small sum (20? 50?) and promise them more if they call you first. If so how much? All advice on the best way to handle this would be appreciated.

It is illegal for a broker to recommend "a specific" mortgage broker in NY. They must furnish you a list of mortgage brokers or don't recommend at all.

#34, can you cite the exact law? I ask because I know of a situation where a listing agent tried something shady along those lines.

well.. it is illegal for any broker or sponsor/developer to force or try to make you use their mortgage broker... these days, you hardly see any broker or sponsor/developr have mortgage brokers having a desk of their own in their firm... but it exists. all you have to do is write down the time+date+detailed word-for-word conversation regarding the situation. and, ask that simple question, "can I use an outside mortgage broker of my choice?"... and if your broker responds something like this, "it is better or in your best interest to use mine only because he/she's good..." then, it's usually a trashy broker that needs to be taken down!

if you do record them on the phone, it is usually the court's decision if it could be used as evidence.

check this out regarding finding the best mortgage

http://bankrate.com/brm/news/mortgages/20061221_7_mortgage_moves_for_2007_a1.asp

new poster here. sounds like antitrust violation (tying arrangement) at a minimum. most states, as well as the feds, have laws prohibiting these kinds of tying arrangements.