Hiring a Buyer-Agent

The commission lawsuits and action by the DOJ will cause buyers to wonder if they need to pay for representation, and what do they get if they do.

It will also be a function of how much it costs. If the service was free, everyone would do it.

It’s been like that in the past, but it also caused buyers to be a little too casual about who they selected, and they tended to just grab someone – which doesn’t always bode well.

  • If the fee was 1% at closing, you’d probably do it – if you liked them.
  • If the fee was 1.5% to 2.0% and the terms were clean and non-exclusive plus the agent made a really good case why he’s worth it, then yeah, maybe.
  • If the fee was 2.5% to 3%, there would need to be some guarantees or real promise that you would get exactly what you wanted, and be very impressed with the service too.

Buyers will be able to include in their purchase offer that the seller pays all or part of the buyer-agent commission. But there won’t be any promises about what a seller might pay – if anything. So buyers should be prepared to pay the entire amount to their agent, as agreed up front.

What should buyers expect? What are the skills that good buyer-agents possess and implement on behalf of their buyers? Here is my quick list:

Overall analysis of general market conditions

Video /audio tours of prospective homes for sale

Pinpoint Home-Value Analyses

Measure up the sellers and listing agents

Winning-price predictions

Offer Strategies

Bidding-War Management

Contingent offers that win

Tough and detailed inspections with free quotes on repairs/improvements

Expert deal management

Foreclosure hunting

Bridge-loan financing

Off-market homes for sale

Sniff out any shenanigans

See the new listings in person every week.

There are also the 132 things agents do for buyers linked here, but the real problem is demonstrating the skills. How will buyers know what they need? How will agents show them what they have to offer?

When you go to the car dealer, they let you take the car for a drive around the block. How can you do that with a buyer-agent?

It would be fruitful for agents to have a blog where they demonstrate how they work, and provide evidence of their results. But that may be asking too much of agents.

We do free consultations for sellers. Let’s do them for buyers too.

Buyer-agents should offer their list of services AND be willing to meet any prospective clients-to-be at a home for sale so agents can show them what they do. A tour of a house to point out the positives and negatives will give the potential buyers a great sense of the agent’s expertise.

Agents – let’s make the free consultation at a home for sale part of the effort to assist buyers. Besides, you want to get a sense of whether you want to work with these buyers too.

Before you get married, you should have at least one date!

What do you look for when you meet your potential realtor at a home for sale to see what they have to offer? If they add to the experience something you didn’t know, then you’re on the right track – ask questions! If they say, “Here’s the kitchen”, it is an automatic disqualification – just run to your car!

Jim’s Buyers

Some might be thinking, “Yeah Jim, you’re such a big talker, what do you got?”

I had three buyer sales in the same time period. Here’s how they turned out:

My first job is to gather information to help determine my chances of making a deal. It starts with the listing agent – what can I expect from them? What is their level of expertise? In this case, it was her first listing in three years and the subject property was her grandparents’ house – and her mom was the trustee.

Oh boy.

Because I have experience in the neighborhood, I knew there were more than one neighbor nearby with deep pockets. The south end of Los Robles is the best block in Terramar after the oceanfront properties because it’s not heavily traveled, and if you can see past the neighbor behind, you have a straight shot to the ocean over the state beach which is only 200 feet away. Sales in this stretch are rare, but I’ve had three of them and I knew it was going to be hot. The last sale on this block was in 2019, which was light years ago.

In addition, my listing on El Arbol, priced at $2,499,000, was marked ‘in escrow’ in the MLS when this new listing hit the market. Even though it is only one block east, El Arbol is considered an inferior location because it’s down the hill so there isn’t any ocean-view potential and the railroad tracks are closer. The remodeling efforts on the street are far less than on Los Robles.

So when the new listing went live, their $2,150,000 list price looked very attractive.

The listing agent conducted an open house on the first weekend, which allowed my buyers to build some rapport with her too – which usually helps the cause, especially with the agents who want to feel good. We all knew this was a huge deal money-wise, but more importantly, it was going to be very personal too.

My common advice – wait as long as possible to make an offer. We waited until Monday to make a full-price offer, because the agent told me there was the usual clamoring from other agents, buyers, and neighbors early on, and we figured that nothing was going to happen over the weekend.

My listing was going to close a week later for $2,440,000, so I wanted to get this one into escrow!

The listing agent kicked around our full-price offer for two days and kept telling me that there were other offers, and threats of more pouring in. But I gently convinced her that we would be the best candidates, and guided her to make the right decision. As what usually happens, the agent got so caught up in hammering us on minor details that they forget the big picture.

They countered our offer only for three weeks of free rent and removed the requested termite clearance. Boldly, we counter for a shorter rentback period but I had already had verbal agreement from the listing agent that it would be acceptable.

Back in the day, I used to be more pushy, but it’s such a seller’s market and agents get offended so easily that the softer make-a-friend approach has been more effective – which I learned from Donna! She then took over and did a great job in gathering evidence and convinced them to give us a credit for $14,500 in lieu of repairs even though the agent said she had a back-up offer from a neighbor.

We could have panicked and thrown more money at them early on, but it wouldn’t have done any good because they weren’t ready to deal yet. The timing is crucial, and you have to know when to make the deal – and my constant good-natured rapport building made a difference along the way.

We closed on time for full price.

Since then, my listing on El Arbol did close successfully for $2,440,000, I listed the vacant lot on Carlsbad Blvd. for $1,999,000 and it went pending in 11 days, and then this new listing of a smaller and much more inferior property (I’ve seen it before) on El Arbol popped up yesterday, priced at $2,249,999.

I think my buyers did pretty good!


The next sale was the ultimate example of taking advantage of the camaraderie between agents.

The only thing harder to sell than a realtor’s own home is the long-time residence of an appraiser – because they really know what’s it’s worth, dang it!  In this case, the homeowner had been an appraiser for 40 years. Could anyone convince him that his price isn’t right?

They listed this 80s-built single level for $1,097,000, and while the kitchen and baths had been redone, it was a while back and they probably need it again. It is on a half-acre lot with fruit trees, it had vinyl windows and a smattering of other minor improvements. But the roof was shot, and we knew it would be a project to get it up to my buyers’ satisfaction.

We offered $1,000,000.

We really wanted to offer less than that, but we agreed that anything with a 9-handle would surely offend the appraiser-owner. Let’s offer an even $1 million and hope to stick to it as close as possible.

I had sold a previous listing with this agent a couple of years ago, and she remembered us fondly. We discussed her family, her recent sales, her thoughts on this house, etc. Basically, I let her air it out for 15-20 minutes and what woman doesn’t like that?

We both agreed that the house needed work, and any other buyers would make her life miserable. We made our offer on December 11th, and I promised to close by the end of the month (house was vacant).

She told the sellers to sign my offer, and they did.

Then Donna went to work and got another $30,000 out of them for repairs and credits.  We closed for $1,000,000 on the last day of the year, though it is still marked pending here.

Listing agents want to have smooth sailing during the escrow period, and that’s taken into account when they anoint the winner accept an offer. Because we had such a good experience previously, the listing agent want to do business with us again – and she gave us a good deal too.


My buyers of this newer house in University City had been looking for years. They didn’t have any kids when I first met them, and now they have two!

Though it was listed with a Compass agent, I knew not to expect ANY love just because I’m a Compass agent too (I think they should be some Compass love, but that’s another story). Of course, he was happy to tell me about all the clamoring there too, and that he had four offers.

I ask listing agents, “What will it take to buy this house today?” and it’s amazing what you will hear. Usually it’s a bunch of stuttering vague stuff, but in this case, he told me a very specific fact that made me think that I had a leg up on the competition – and it had nothing to do with Compass.

It was listed for $2,050,000, and we offered $2,000,000 financed….and they took it without countering.

Then Donna got an additional $19,000 in repairs and credits. It is closing today.

P.S. The value was tough to comp because the UC houses are typically so much older and goofy inside. This house was completely torn down and rebuilt in 2005, and compared to what 3,426sf will cost you in Carmel Valley, we thought it was a heck of a deal for a newer home at our sold price of $2,000,000, or $584/sf – even compared to the UC homes:


I’m the first one to tell you how hard it is being a buyer’s agent today – and I cover it regularly here. But I’m still going to fight like heck for my buyers, and get them the best deal possible.

Plus, I come from the school that is is better to NOT buy, then to overpay.  I think that thought has drifted away and now it’s fine if buyers want to pay too much because it’s only money.

But we’re going to get you the best deal we can!

Assigning A Contract

I mentioned this dilemma a few months ago and the C.A.R issued clarification in October. While the contract generally tends to be seller-friendly and of course it protects realtors at all costs, this is an advantage for buyers:

Sometimes during the course of the transaction, a buyer may need to assign all or a portion of their interest in the contract. This could mean swapping out one buyer for another (a total assignment) or it could mean adding an additional buyer to the existing one (a partial assignment) or it could mean deleting a buyer or replacing buyer(s) with at least one original buyer remaining (other assignment). In each case, buyers under the Residential Purchase Agreement (C.A.R. Form RPA) have a limited right to assign their interest in the contract as long as they follow the appropriate procedures.

Right to Assign under Paragraph 23 of the RPA

Paragraph 23 of the RPA lays out the procedure for an assignment to take place. If the buyer is assigning all of their interest to either 1) their own trust or 2) any wholly-owned entity of buyer’s that is in existence at the time, then the buyer has the right to make the assignment and does not need seller’s consent.

In any other circumstance, buyer may not assign the contract without first getting the separate written consent of the seller to the specified assignee. The seller’s consent, notably, cannot be unreasonably withheld.

When making an assignment request, the buyer must:
• Disclose the name of the assignee
• Disclose the amount of any monetary consideration between buyer and assignee
• Provide assignee with all documents relating to the transaction
• Ensure that assignee will provide a letter from assignee’s lender that assignee is prequalified or preapproved as specified in the RPA

If the buyer does not deliver the assignment request and satisfy the above requirements within 17 Days after Acceptance (or whatever time is specified in RPA Paragraph 3K) then the seller’s withholding of consent to the assignment shall be deemed reasonable.

On the AOAA form, the buyer has to declare the amount of the payment involved:


Hiring A Buyer-Agent

Hopefully the hubbub about realtors’ pay will cause consumers to investigate agents more thoroughly, which I’ve been encouraging for a while. Here’s one of my blog posts from 2009 – check the comment section too:

Most buyers struggle to find a quality realtor to assist them in buying a house, and it’s the realtors’ fault.  The national, state, and local associations are so adamant about protecting the new agents and giving everyone an equal chance, that they provide no help whatsoever to the general public.

Their message?  When trying to find good help, you’re on your own.

So how do you get what you need?

Everyone tells you to ask around, get referrals from friends, go to open houses, go with a big company, go with a small company, new agent, old agent, kickbacks, etc., that it probably doesn’t matter where you get a realtor, what matters is how to evaluate them.

Here are my things to look for when evaluating a realtor’s ability to help you buy a house:

1. ASK ABOUT THEIR RECENT TRACK RECORD OF SALES – Let’s cut to the chase, shall we?

Has the agent been able to successfully guide others to the finish line this year?  The best answer is 1-2 closings per month, if you want an agent who delivers personal service.  Any agent who sells four or more per month is slamming people into houses, and those at zero, well let’s face it, they don’t have anything of value to add to the equation.  Get a testimonial from a past client, and/or at look at the sales they’ve done and judge them to see if they were good deals.  (I’ve assisted 10 buyers with closing their sale this year).

These current market conditions are unlike any seen before.  If your agent has been closing some buyer transactions this year, they must have something of value to share.  Here’s what to look for:

2. ASK THEM, “WHAT/WHERE ARE TODAY’S HOT BUYS?  How they answer that will tell you just about everything you need to know.  If they give you a smart-aleck answer, they probably aren’t the right agent for you, only because they aren’t in the game.  If they can name one, at least they are looking at properties, and those are agents who can provide value – ideally your buyer’s agent is previewing property every day, in person.

3. THEY SHOULD ASK YOU QUALIFYING QUESTIONS – If they jump in the car without asking questions, their time must not be too value to them, and this isn’t a business where wasting a lot of your time makes for good quality realtors.

4.  THEY SHOULD KNOW ABOUT FINANCING – I guess it’s alright if they just hook you up with their lender to get pre-qualified, but if they can ask/answer the qualifying questions themselves, it might help when it comes time to structure an offer.

5. HAVE THEM SHOW YOU SOME HOUSES – Go in their car, and if they don’t need a map to get around, you’ve found an experienced veteran.  It’s not guaranteed that they can help, nor is it required, but it’s a good indicator.  If they are pointing out specific sales/listings along the way (theirs or others), then they know the comps too, which is another great indicator.

6. EVALUATING THE PROPERTY’S CONDITION – They don’t have to be a general contractor, but they should be able to educate you about the property’s condition.  If all they do is point out that “This is the living room”, they’re not going to have much to offer in terms of added value, unless you don’t know what a living room is.

7. HAVE A VENDOR’S LIST – Successful agents know professionals to call to fix stuff – the more thorough the list, the more problems they have encountered.

8.  DO THEY CHARGE FOR THEIR SERVICE? – Ask about “transaction fees”, “processing fees”, or “compliance fees”.  These are junk fees used to pad their bottom line, and are not required.

9.  DO THEY INSIST ON HAVING YOU SIGN A BUYER-BROKER AGREEMENT? – Pass on those, unless you got married after having one conversation too.

10. “FORECLOSURE SPECIALIST” – Be very leery – we are all foreclosure specialists now.  Any agent who tries to make it sound like they have some special “foreclosure ability” is blowing smoke, unless they are listing REOs and not putting them on the open market.  If they don’t mind breaching their fiduciary duty to their bank-seller, they’ll sell you down the river in a heartbeat.

11.  SHORT SALES – I personally see 2-3 short sales every day that have already found their buyer before MLS input, and it is VERY frustrating.  These agents don’t care about their own reputation amongst their peers, and that alone should make you wonder.

12.  OFF-THE-GRID – Ask about what agents can do to find properties that aren’t on the regular websites.  Any positive response would be a good indicator, and any examples of closing one would be even better.

If they can get through those questions and you still like them, you found a good agent!

NEW AGENTS – A new agent’s zeal and availability can really help buyers who don’t have the time or willingness to search for properties themselves.  Want somebody to do the legwork for you?  Put a new, hungry agent on it, but there may be some struggle clinching the deal if there are competing offers.

OUT-OF-COUNTY AGENTS – You’ll be doing all the work yourself, so your own proficiency in being a realtor needs to be up to par.

RELATIVES – Many deals crash and burn, and hearts are broken over houses.  Want a relative to help you?  Make sure that you’ll accept never wanting to talk to them if they cost you the right house, at the right price.

“GREAT TIME TO BUY” – If you hear that catchy phrase, just walk away.

The inventory of quality homes at good prices is EXTREMELY LOW, causing the buying experience to be full of frustration and disappointment.  You can look for weeks or months without seeing anything attractive, so I don’t know why any agent would call that a great time.

REALTOR TEAMS – No problem, but don’t interview the big dog and then get passed off to the assistant without asking the same questions.  You want to be clear about who is helping you, and what you can count on.  In my case, I may have Richard or another KR realtor help me on occasion, but I’m still the main person in charge, and am responsible for your success.

Turkey Talking Points

What a great day! Delivering pies and talking real estate – what a privilege!

Talking points you might hear over Thanksgiving dinner.

 – It’s too unaffordable. Prices have to adjust.

There will be the occasional seller who gets caught in a pinch and has to sell that day – and might take a 10% to 20% discount. All you have to do is be there on that day. It is why you have a realtor!

But will it be a superior home on a premium lot? Highly unlikely – those owners know what they got.

Buyers need to decide: Are you a lowballer, or are you trying to buy a high-quality property? It’s either/or.

Bottome line: Prices may adjust downward on the inferior properties. Take your chances.

– There seems to be more homes for sale – is it the big slowdown?

As time goes on and the market gets tighter, it will be natural for sellers to price too high and cause inventory to grow. It’s easier than ever to overprice and miss the market! What to do?

Spruce up the home and price attractively, which is about where the comps are….and not 5% to 10% higher.

Tip: Lately the local prices have been going up about 0.5% per month. But once a home is on the open market, the buyer expectations drop about 1% per week on price.

Once as home has been on the market for 2-3 weeks, there might be some negotiations on price!

 – Are commissions negotiable now?

Yes, absolutely and agents who are desperate and have no skills will be happy to represent you for 1% or less. It’s a ripoff. Find an agent who will produce beyond expectations. The best thing to come out of these lawsuits is that consumers will investigate agents more thoroughly!

Get Good Help!

If it gets hot, just call me. I’m happy to talk to people on the phone!

Why Compass

Yesterday, 2,400 Compass agents came to the Rady Shell to hear CEO Robert Reffkin discuss the accomplishments of his clients, the agents. Here are this year’s facts to plug into our presentations:

Compass #1 in sales volume nationwide last two years.

Compass agents sell 2.5x the average agent.

Retention – 98% of Compass agents stayed last year, and 300 who left have come back.

$1.5 billion invested into the agent/client platform.

500+ people in the engineering department improving tech daily.

$1.0 billion in Compass Concierge money spent to maximize the sales price for sellers.

$1 trillion in sales volume in less than ten years.

High tech and high touch!

The support that Compass agents receive from the brokerage enables us to be more effective with helping our clients, and run our businesses with high efficiency!

Robert is one heck of a leader. This year, he has visited 40 metro areas to meet with agents in most of the 200+ Compass offices. Then on the weekends, he takes his wife and three little kids to open houses around the NYC area in support of Compass agents – including on Mother’s Day!

But in the end, it is up to the individual agents to perfect their own presentations. The best thing any leader can do to support highly competitive people is to create a contest!

There will be local, regional, and national prizes for the agents who deliver the most buyer-broker agreements and sales in 2024 – with the top ten agents being flown to NYC for dinner at Robert’s home!

Buyer Listing

The first week after the realtor-lawsuit verdict went as expected – chaos, doom, and no sexy alternatives. It will take years to appeal, but it won’t matter how it turns out. Buyers are going to be paying their agents.

If sellers aren’t obligated to pay any commission to the buyer-agents, will they appreciate the benefit of incentivizing buyer-agents with a bounty, or reward? Probably not, unless their listing agent makes it very clear, and insists on it.

It is more likely that listing agents won’t push it, and because sellers naturally will want to pay less commission and not more, they will list for 2.5% or 3% and hope for the best. Both will shrug it off, and joke about how it’s about time commissions came down!

It will be a grave mistake.

Why? Because the buyer-broker agreement is a disaster:

  1. Buyers won’t like it.
  2. Agents won’t like it.
  3. The market won’t like it.

Today’s buyers are picky, and you can’t blame them. They’ve had to endure +40% on prices, +200% on interest rates, and -50% on inventory…..talk about challenging!

The buyer-broker agreement will be a disaster because both agents and buyers will sign a short-term arrangement and hope the seller might kick in some of the commission. But then everyone will go back to doing it the same way we always have – refreshing your feed every hour and praying!

The real opportunity will be for buyers to hire an aggressive buyer-agent who does more than just watch the MLS. When a seller hires a listing agent, they get a thorough marketing campaign to source every potential buyer in the market. Buyer-agents can do the same, in reverse!

The buyer-agents who offer a rifle-shot soliciting of specific homes that fit the needs perfectly of their buyers will eventually find one. If an aggressive buyer-agent brings the complete package to the seller’s table without having to mess with a full listing, they will likely get an audience. It could even take the place of listing agents!

Because auctions aren’t close yet, this could be what changes the world of residential resales!

It will mean more off-market sales, which means more fuzzy comps because not much if anything is known about the home’s condition. But if it catches fire and the MLS or a rogue search portal insists on buyer-agents reporting everything about their sales including photos, we could still have a database full of accurate market data. But if we don’t, we don’t – good luck everybody!

Hope for Buyers

Market conditions in the off-season will be tepid but temporary – buyers will be lying in the weeds, and sellers should wait until the 2024 Spring Selling Season.

I don’t know how this sale above happened, and it doesn’t matter. All that we know is that the seller took an offer that was 29% below the list price. It’s highly unlikely that you or I will get that kind of deal, but you can’t win if you don’t play.

The buyer’s agent is from Laguna Beach and got her real estate license in 2020 so it’s unlikely she had some super-duper sales tricks to convince the seller to dump 29% on price. Either they just happened to be in the right place at the right time, or the seller needed to sell that day.

The chance of you getting a premium home at a discount is low – probably less than 5%. But you can’t win if you don’t play! Make offers, the off-season is upon us!

Buyer Testimonial

Are you wondering what it is like being a buyer these days – and how we can asisist you?

This is a good example. Our buyer above made offers on seven different homes over the last year before winning the right home, at the right price. We survived a five-offer bidding war when the sellers accepted our offer of $1,340,000, then we worked them down by $50,000 after our inspection.

At $1,290,000 for 1,801sf, I think it will be one of the better buys in Carlsbad this year:


This street is the next block over, and though these are a little bigger, we loved the prices:

We can help you too!

Sweeping Ocean View

The minute I saw this address I knew that it would have a big ocean view because I sold one in here before. It turns out, I sold this very home in 2001 for $257,000 when it was all-original (I rep’d the seller then). It has since sold for $461,000 in 2005, $429,000 in 2014, $613,000 in 2018, and $979,000 on Thursday.

My buyer is out-of-state and made the offer based on this video – and then came for the home inspection:

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