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You were correct in recognizing that the broker tends to maximize his/her own interest. You can put in any contingency in the offer you make; doesn't mean the offer will be accepted. Every real estate deal is different, depending on the market conditions for that specific house in relation to just how indispensable the agent's role is. There is no "fair price" for the broker's effort just like there is no "fair price" for the house itself. Consider three extreme cases:
1. The market is going gangbusters (like it was before 2007), the seller and broker can ask whatever they want, the buyers are beating each others' brains out to get a house before the price goes up again. Obviously, the only way to get your offer accepted is to offer more than the asking price, and offer to kiss the rear ends of both the seller and the broker, and name your future children after them if they would accept your offer.
2. The market is clogged with unsold homes, for which you are sure there isn't likely to be a competing offer for months to come. In that case, not only can you low-ball them both . . . and if you haven't met the seller's broker yet and did not find the house via the broker's listing, you can even talk to the seller into waiting for the listing period (during which the seller is obligated to the broker) to expire and do the deal directly with the seller without the broker altogether. You'd better make sure the house is not going to be snatched by someone else willing to pay just $50 more per month more than you do.
3. The house is on the verge of being foreclosed or already foreclosed. The Seller has long stopped making payments on the house months if not years ago, therefore can't care less. The bank's left hand doesn't know where its right hand is doing. The broker is the only one pushing any marketing effort along in hopes of having a transaction. In that case, the seller's broker is doing a lot more heavy lifting in making sure that things are actually happening instead of completely flat-lining. IMHO, your not having a buyer's broker therefore letting the seller's broker eating the entire 5-6% might just be the most effective incentive for the broker to keep working hard to achieve a result that is desirable for you. The decision for you to make there is not scraping a couple points off the broker but to make sure that the offer price makes sense to your own finances.
There is no "fair price" in any thing. The broker's worth is entirely dependent on how crucial his role is in having a deal at all.
posted by 76.118.39...
, Wed, 30 Mar 2011 07:36:53
, Mon, 28 Mar 2011 13:51:03
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