Real estate question

[Beaver]

I'm moving out of the Kootenays to Vernon. I've been working with a RE agent he's shown us about 30 houses, it took us a while to figure out were we wanted to be, how much we needed to spend and what we wanted in a house. I recently found a private sale that looks promising.

What is the etiquette for buying a house after you've been using a RE agent but found it privately? Do I just blow him off and do the deal directly with the owner (with lawyers or notaries...) or do I get him to broker the deal?

[Harry]

Do I just blow him off and do the deal ?

^^ this ^^

[jamesp]

It feels like a dick move but I don't see any other way other than blow the RE guy off. Seller pays the commission & private sale means this seller doesn't want to pay.

You can get the standard BC contract off the 'net.

[MakersTeleMark]

What is the language in your agency agreement state?

Commission disputes can get ugly.

[Danno]

I'm moving out of the Kootenays to Vernon. I've been working with a RE agent he's shown us about 30 houses, it took us a while to figure out were we wanted to be, how much we needed to spend and what we wanted in a house. I recently found a private sale that looks promising.

What is the etiquette for buying a house after you've been using a RE agent but found it privately? Do I just blow him off and do the deal directly with the owner (with lawyers or notaries...) or do I get him to broker the deal?

Disclaimer: I know nothing about Canadian RE, so this is based on my experience in the US. But honestly, there's not necessarily an easy answer. Many FSBOs are willing to pay a commission to represented buyers, because they know that opens up their buyer options dramatically. Is this seller willing? If so, he's already factored in that commission in to the price. If not, you'd probably have to pay out of your pocket. Edit: and as MTM states, your agreement with the RE agent may speak to this, but may not.

The answer may depend on the complexity of the RE transaction where you live. Some RE agents are worthless, but there are often land mines (pun intended) that a good RE agent can foresee and protect you from. Are you prepared to do the whole transaction yourself, are you comfortable with the process?

[Danno]

It feels like a dick move but I don't see any other way other than blow the RE guy off. Seller pays the commission & private sale means this seller doesn't want to pay.

many private sellers are willing to pay a buyer's agent commission.

[Bromontana]

Tell the FSBO you have an agent. See what they say.

Keep in mind how much you're spending and that agents are an indirect form of insurance. They help you avoid red flags the public may not spot. They have reputable home inspectors that can save your a$$ on things the average JONG wouldn't spot. Often times you can get a few grand in repairs done at no cost to you and cover a portion of the cost of the agent.

In my opinion, use an agent and say "hey look, found this place. You ok to chop the commission a bit and still participate in this deal to protect my interests?" Feel it out and go from there.

The value of agents is highly variable based on the quality of the agent. Same for inspectors. Also your expertise in RE will influence how much or little you gain from going with a broker. Think about these variables and also your risk tolerance on the purchase.

/blabbing

[Mazderati]

Varies from locale to locale. If the potential buyer and agent enter into a contract or the agent introduces the potential buyer to the property, the agent may be owed a commission. If not, and the agent is liked, some type of compensation for the agent's time would be a nice gesture. $5 Starbucks gift card?

[riser4]

And other times the only thing the agents are protecting are their own profits. I mostly classify Real Estate as a legal scam.

[whyturn]

I did mine myself after discovering agent was being illegal in middle of closing. Was not too bad. Contract was like hundreds of pages. Condo though. I gave up and signed. Title company helped. It's a sales job. No sale no tiki

[jamesp]

It's pretty unusual in Canada for there to be any sort of written agreement between a buyer & agent prior to a signed contract. The buyer/ agent relationship is a page in the standard contract, commission is disclosed etc, but I don' think there is any formal relationship prior to the contract being signed.

The lawyer / notary is the one who checks the title is clear & checks the contract etc, which is the more important bit.

Agents can be useful to get you in to see properties faster but that only matters in certain market conditions.

[Kinnikinnick]

Yeah - Let him get paid $0 after he's spent days running around showing you houses so you could figure out what/where you want to buy and now that you find the one thing being a private sale that you know fits the bill because you've seen 30 other places to compare it to. What's he or anyone else to you but a whore to be used and abused and jettisoned at the earliest convenience? Find a little tighter piece of ass, dump the wife/gf. Find some more popular friends, abandon the old. Fuck everyone and look out only for yourself, what do you owe any of them?

[bagtagley]

^^That guy is definitely not a real estate agent.

[oftpiste]

Ask your agent to approach the private sellers before you do to see if they're willing to work with and pay him. Give him that shot. if that doesn't work pay him something. there's a lot more to helping people find a house than just unlocking the door for them. I suspect he gave you lots of advice about all kinds of things, and that's worth something.

[Huck_Schmuck]

I have played a real estate agent on TV. And it happens to be what I do in North Van.

A good friend of mine went through this recently - he was looking out of my area - his agent spent lots of time and effort on him and in the end he found a private seller through his brothers' cousin... blah... blah. He called me and asked what to do.

At the end of the day our (realtors) business model exists on not getting paid until the job gets done. We have our timed sucked up by Buyers and Sellers, some reasonably and some, not so much. Shit goes sideways for all kids of weird reasons, we have to expect it to happen every now and again and if your agent can't handle that they are in the wrong business. How you deal with it is reflection on your goodself.

If it's not too late see if you can cut your agent in on the deal. Representation is there for good reason.

My advice to my buddy was find out what he drinks and get him a bottle / case of it depending on what he thought was appropriate. I was sure to point out to him, don't just turn up with a sixer. He would have stood to make around $6,000 on the deal after all.

In the end, I helped my buddy through the paperwork (all the legal stuff and strata documents). He got me a $100 bottle of wine so I'm sure the other agent was reasonably well looked after.

I've had other clients whom I've worked with, Sellers and Buyers, you can spend lots of time with them and then the situation changes. No hard feelings. In fact they can often become a great source of referrals as they end up feeling guilty. So your agents reaction to you telling them the news should actually dictate how well you compensate them.

If your agent was really good he would have already shown you a list of FSBOs. Did you sign anything previously with them? In BC we do have some Buyer contracts that could see you on the hook but most agents don't use them.

PM me if you want to chat about it.

[Danno]

I've had other clients whom I've worked with, Sellers and Buyers, you can spend lots of time with them and then the situation changes. No hard feelings. In fact they can often become a great source of referrals as they end up feeling guilty. So your agents reaction to you telling them the news should actually dictate how well you compensate them.

Yep, I was working with an agent on and off for the past year (mostly off, but he did show us between 5 and 10 properties), but we ultimately decided that it made more sense to remodel our current home rather than buy something else. We apologized to him and thanked him for his time, and definitely will (and have) referred him to others.

[Caucasian Asian]

Try on boots with a bootfitter and then order them online.

[Cruiser]

Yup, you owe your agent nothing unless you signed a contract with him. Realtors get this sort of thing all the time. It comes with the territory. If you feel capable of doing this deal on your own and you don't need him to negotiate with the seller for you then you should walk away without remorse. If you want to thank him for his time then tell him sincerely that you will gladly refer any friends or relatives to him if they're looking for a good realtor.

[Kinnikinnick]

If it's not too late see if you can cut your agent in on the deal. Representation is there for good reason.

My advice to my buddy was find out what he drinks and get him a bottle / case of it depending on what he thought was appropriate. I was sure to point out to him, don't just turn up with a sixer. He would have stood to make around $6,000 on the deal after all.

I've had other clients whom I've worked with, Sellers and Buyers, you can spend lots of time with them and then the situation changes. No hard feelings. In fact they can often become a great source of referrals as they end up feeling guilty. So your agents reaction to you telling them the news should actually dictate how well you compensate them.
In BC we do have some Buyer contracts that could see you on the hook but most agents don't use them.
.

Yeah - things change but this isn't the situation changing, its the client working around the agent.

This is why I have my clients sign buyers representation agreements that cover any purchase and have the FSBO conversation with them. My time is too valuable to spend weeks helping clients just to have them compete against me.

I have had many clients go another direction (not buy, move out of state, etc) and that is AOK and I'm happy for them, but if someone were to use my services in the form of time and expertise and infromation to learn what they want and what the market is and then circumvents me, not cool. I could have gone skiing instead of giving them free advice, information, expertise and time.

OP - just contact the agent and ask him to contact the seller to see if a commission can be worked out. And if not then work out a services fee to help analyze and close this deal.

[LightRanger]

The value of agents is highly variable based on the quality of the agent. Same for inspectors. Also your expertise in RE will influence how much or little you gain from going with a broker. Think about these variables and also your risk tolerance on the purchase.

Good advice in this thread, generally.

The quote above is particularly true. A good agent (quality varies a lot) can keep you from stepping in shit. A good one will know home inspectors, contractors (roof, plumbing, septic, etc.), and other professionals that will inspect something at a (usually) low cost that may end up saving you thousands in actual costs, and maybe even litigation. A poor agent will push a deal without looking at all issues and then you end up suing them when you discover shit tons of dryrot and they told you to skip the pest inspection... (<--- This kind of stuff happened a lot in CA from 2008-2012 when agents got desperate after the RE bubble burst.)

In this case, unless you're absolutely certain of your own abilities to spot potential trouble, it might be worth trying to keep your agent at a reduced commission, assuming you otherwise like him/her. My .02, after stating in another thread this morning that RE tends to be a profession with a lot of boneheads.

[Huck_Schmuck]

Yeah - things change but this isn't the situation changing, its the client working around the agent.

IMO if a Buyer *finds* something the agent dropped the ball. If I haven't shown something to my client why should I get paid on it??? FSBO or not, the agent did not know the inventory.

We could do with some more details though, I re-read the OP. What do you mean by "looks promosing" unless you are under contract with the Seller get your agent in there, ideally, before you contact them.

IME FSBO sellers are unreasonable and greedy, you need your agent to do a decent CMA on the place before you talk about $$$.

[fatnslow]

If you are comfortable with a simple real estate transaction do the deal yourself and pay your agent what you think is fair compensation for their time. Most real estate transactions aren't that complicated, just make sure you find a good inspector. Real estate listing commission rates are a first world scam. 5-7% was fine when a transactions were under a $100K but with the value of property reaching 7 figures these days the market really needs to adjust the listing fees.
No matter what you do if you buy a FSBO your agent will not be happy since they will be losing money.

[jamesp]

you need your agent to do a decent CMA on the place before you talk about $$$.

I guess you know this but some recent sale info is available online for free in BC, enough to make an informed choice re price IMO.

[haydukelives]

OP - just contact the agent and ask him to contact the seller to see if a commission can be worked out. .

That is absolutely the worst piece of shit advice

[el hefe]

Beaver, I am a realtor in Vernon.

Good advice by huck!

Most FSBO's will work out a deal if the realtor prepares all of the paperwork and handles the closing etc... I have done this many times with varying levels of payment coming my way. Bottles of booze, cat skiing, $5000 whatever. It comes with the territory like some have said.

If you want a quick and dirty idea of value you can PM the address and info. I owe you for all of the NSFW work images you have posted over the years.

What are you going to be doing in Vernon? Solid crew of B/C skiers and a lot more close terrain then most people think here.