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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]We bought using an hourly realtor (Spicer Realty).  You can save a ton of money if you're buying a more expensive house (particularly in the $1mn plus range.  Yes, you pay a lot to get taken to showings and stuff, but we still got a large rebate (enough to furnish 3 bedrooms of our house) since they don't take the full 3%. [/quote]

Is this how it works?   Say you buy a $1M house and the agent gets $30,000.  
Do they take their $200 fee for writing the contact from that commission and you get the rest or do you have to pay them when they write the contract?  [/quote]

In theory (pre-settlement) what would happen is that the seller would pay less to the buyer’s agent than offered, then the difference (say 1% of the sales price) would go to reduce the price of the house or perhaps cover other buyer closing costs (to the extent permitted). When we bought without any agent (actually it ended up being dual agency) the seller agent took I think 4% commission.  So the sellers got an extra 2%. We did not get any concessions (eg we paid the list price and all closing costs) but it was a very competitive market so it helped us get the house with no escalation. [/quote]

Sorry to be dense but if the seller isn’t offering to pay the buyer agent, would we only have to buy the hourly agent $200 or so to write the contract?   We wouldn’t be obligated to pay more?  TY [/quote]

Correct. Now what is *supposed* to happen is that the buyer contracts directly with the buyer’s agent for what the agent will be paid. So if you agree to hourly or a flat fee, that’s it. What’s a little more complicated is that you still CAN ask the seller to give you a “concession” to pay your agent - and some sellers may offer this up front. So the contract you have with your buyers agent could take this into account. Something like: “Buyers agent will receive a flat fee of a maximum of $8000 which may be paid directly by buyer or as a concession from the seller.” Basically you want the buyer agent comp to be concrete up front. Then if you can get the seller to pay part of it, cool. Or if the seller is offering 3% but your agent only gets 1% (per your contract) then that extra 2% becomes a bargaining chip for you.

There are a lot of different ways this could be handled through different types of contracts and negotiations- I’m not sure if there is any one standard! What IS true is that the buyers agent should not feel entitled to whatever the seller is offering. They are not negotiating for their own pay. You are negotiating an overall deal which includes paying the amount YOU have agreed directly to pay your agent. [/quote]

How did this go from us paying $200 to an agent to write a contract to us agreeing to pay an agent $8,000?  Can't I just hire an agent and pay them to write a contract and not have to pay them more?[/quote]

Of course you can look for that. I think for some people who don’t know that much about it, the advice of a buyer’s agent on how to write a winning offer in the really competitive DC market may be worth it. May also be worth it to have them arrange all of the viewings for you. But yeah, it IS hard to see how that work (maybe 40s max for agent?) is worth more than 3-4k. [/quote]

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