Category Archives: exclusive buyer agency

How Real Estate Investors Benefit from Exclusive Buyer Representation

Smart Real Estate Business

 

From the perspective of the buyer—especially an investment buyer—it’s important to have all available information about an asset in order to make the maximum yield from each invested dollar. In order to accomplish this, they would need market efficiency in strong form (Clauretie & Sirmans, 2010, p. 40).

Obviously, from the point of the seller this would not be a good thing, because the more information a buyer has about a sellers situation, the more likely they are to create “excess returns” (Clauretie & Sirmans, 2010, p. 40). This would be a compromise to the sellers’ position in the deal. As a neutral facilitator; a broker is not legally free to fully support either side because the information provided to one side could be detrimental to the other.

When buyer and seller have their own representation, a true meeting of the minds can occur–each side fully represented and supported without reservation. In the legal profession, attorneys are not allowed to create conflicts of interest. By law, they have to check for them before taking on a new client. In real estate, dual agency is a conflict of interest. This is why most states require their brokers–in dual agency situations–to get permission first, and then stay neutral throughout the transaction.

Ref:

Sirmans, T. M. (2010). Real Estate Finance: Theory & Practice (6 ed.). Cengage Learning.

[VIDEO] What can I do with a small amount of money in a Self Directed IRA?

CLICK to enlarge image.

 

I found a very interesting educational video this morning. I thought it compelling enough to share. With knowledge comes the power to make positive changes. Real progress. How we choose to respond to circumstances determines the path ahead as well as the outcome–good or bad. By the way, I am not being paid to make this post. I am only sharing good information that has the power to make all the difference in the world for many people who concerned about the state of their retirement.  There are many educational resources out there that are free. Get educated, seek professional advice, and become self-empowered.

httpv://youtu.be/UW1otvu5m1Q

Three tips for first time homebuyers: Peace is in the planning!



I remember when I bought my first home. It was one of the most exciting times in my life. What I love most about what I do is that I get to re-live that joy every time I deliver a set of keys to a brand new homeowner. I can see it in their eyes when they realize the home they are standing in is all theirs including the land.

Here are three reasons why your home buying experience will be more peaceful when you take a little time up-front to plan:

1. Reduced anxiety

There is so much uncertainty in the eyes of the first-time home buyer, but generally I see nervousness that can materialize in different ways. It depends on the person being nervous. A good buyers agent will take the time to familiarize themselves with your preferences. They will make your life easier and buying experience more enjoyable and ultimately more exciting, so make sure that you find and work with only the best. You can find a good buyers agent by asking them to provide references from past clients.  When a  good buyers agent consistently delivers a quality service to their buyer clients, their clients are typically very happy to provide a reference.

2. Have a clear picture of what you want to accomplish, and more importantly, how you will accomplish it.

3. Move forward with a sense of confidence. When it comes to buying real estate. Planning goes a long way to ensure your peace of mind when you are buying your first home. A good buyers agent will earn their weight in gold when they can connect to your preferences quickly, spot signs of trouble in a transaction or property, and  then work to resolve issues as they arise in an efficient way.

 

Buying a home is only the beginning of a whole new world of possibilities. While you are cozy in your first home, you can start thinking about how you would like to liberate yourself through real estate investing. A buyers agent with experience in real estate investing will take care of you on all fronts. They are a partner in your success, so choose wisely and make sure that they recognize what it means to fill this role in your team of professionals. A good buyers agent will look to familiarize themselves with your vision of “home,” as well as your vision of what you want rental income to do for your life, and then work with you to uncover the options to help materialize that vision.

Planning ahead is key to spelling out all of these components before you step into the market, and to your peace of mind during the process.

 

Bait and Switch Tactics in Real Estate: Four Things Every Buyer Should Know.

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I have seen many listing agents start out listing properties at below market value and then use the resulting flurry of buyer interest to spark bidding wars.

While this practice benefits the seller, and the listing agent would not be doing their job if they did not try to get the highest price possible for their sellers, buyers need to remember that this strategy only works when more than one buyer takes the bait.

Here are 4 things buyers should bear in mind about bait-and-switch tactics in real estate:

1. Remember, demand creates value, which increases prices. The opposite is also true. When demand goes down, so do prices.
By engaging in bidding wars, you are driving prices up.

2. If you want to find a truly great deal, then you most certainly do not want to render yourself a tool for sparking a bidding war.

Instead, find out the motivation of the seller. If seller or their agent appears evasive, take note, give them the benefit of the doubt once, and then move on if it appears that you cannot get straight answers. This is a red flag.

3. If you engage in the game of bait-and-switch, then be prepared to waste some time.

It is no wonder many investors prefer to look at unlisted properties, and save listed properties as a last resort.

4. Wise investors avoid bait-and-switch pricing games. They realize that there are too many good deals out there to allow themselves to be used as leverage in the ploy to get the highest price possible.

Smart investors do not get emotionally attached to properties. Emotions are the hooks that make pricing games work so well. Eliminate emotions from the equation and pricing games are no longer as effective.

Real Estate Market is Coming Up Roses but Buyers Should Beware of Thorns

NAEBA just released its latest press release regarding buyer agency and the confusion that occurs when traditional real estate agents call themselves exclusive buyer agents when, in fact, they are not because their companies also represent sellers:

Here’s an excerpt from the release:

“We believe it is important that home buyers understand their options so they will make the best choice when selecting an agent,” commented Benjamin Clark, 2010 President of NAEBA. “It is our mission to educate buyers on the advantages of using Exclusive Buyer Agencies and we want buyers to have that information before they sign a binding agreement with a real estate brokerage.”

A “buyer‘s agent” is not always an Exclusive Buyer Agent (EBA). Agencies may have singular relationships, representing buyers or sellers only or they can be a dual agent that represents both sellers and buyers at the same time. Within a dual agency brokerage, there may be “buyer agents” but this differs from NAEBA (http://www.naeba.org) member companies where both company and agents exclusively represent buyers and never take listings. In fact dual agents and dual agency companies may represent buyer and seller in the same transaction, with written consent.

Read full release: Real Estate Market is Coming Up Roses but Buyers Should Beware of Thorns

Thoughts from a Seattle Exclusive Buyers Agent (EBA): The High Cost of Low Trust

For the past six months, I have been reading a lot about the importance of trust and the profound affect it has on daily life–personally and professionally.

In one article featured on StephenCovey.com, it explains how low trust “has a huge tax associated with it." Some of the main compelling points in the article include that trust is very important in business, and that one cannot conduct business effectively without mutual trust. In fact, the article asserts that trust is vital:

“There are just so many elements to the simplest transaction that require trust. But we are like fish that discover water last and are sometimes unaware of those implicit elements. Trust is the lifeblood of all relationships, of all transactions, and is so foundational and fundamental to everything in life.” (stephencovey.com)

I discovered that I prefer working in an environment where there is genuine trust, mutual respect, and a collaborative team spirit. This also extends to personal life and relationships. With this kind of synergy, people can build meaningful connections and bring the experience of life to a completely new level. Without it, distrust, adversarial interactions, and the speed of accomplishing goals dramatically decreases to the detriment of all involved.

For real estate buyers, working within a culture of high trust can make the difference between working with what Robert Hahn of Inman News calls a "House Hawker," or a "Trusted Advisor." It means the difference between working with a human door opener and a dedicated real estate advocate.

Real estate buyers working with a highly trustworthy agent will benefit greatly from the resulting synergy that develops through dynamic collaboration. Good things can happen faster. When combined with a highly trustworthy mortgage broker, the result is a profoundly effective team and support system for real estate buyers. Such teams can make excellent progress and realize outstanding results over and above what buyers could achieve on their own or in an environment where everyone is in it for himself or herself.

It takes high trust, active listening, mutual respect and understanding, as well as open communication and being receptive to new ideas to realize unparallel results. This is the vision I have for my life personally and in business. I aspire to bringing out the best in others and in every situation. It means being accountable, responsible, caring, while adding value to the lives of others. It also means focusing on relationship building and mutually beneficial partnerships based in the spirit of good character, hard work, and goodwill.

With awareness comes the truth, and with the truth, the right thing to do becomes clear. Trust in ANY relationship whether client, referral partner, friend, or family member, is essential to the health and happiness of the human experience. Therefore, I am committed to building trust with all the relationships in my life. I will not settle for anything less, and I wish the same for you.

Here are some resources and articles on trust and trust building:

What is trust? ( from changingminds.com)

The Speed of Trust: The one thing that changes everything (Stephen M.R. Covey)

More resources, perspectives, books, and articles about Trust

Trust Agents by Chris Brogan (Thanks George !)

Exclusive Buyer Agents Unite for the 15th Annual NAEBA Conference and Cruise

It’s hard to believe that only a few days ago, I was on a Royal Carribean cruise to Cozumel for NAEBA’ s 15th Annual Conference. It was such a thrill to meet other real estate professionals that are passionate about providing representation to real estate buyers without conflicts of interest. I am looking forward to next year’s conference in Tuscon, AZ!