Miami Real Estate: Bare Truth about Buyer Brokers


As a traditional agent showed you a lovely home in Miami, and you were to propose to offer $145,000 and pay no more than $155,000, this piece of information could very well find its way to the seller whom the agent represents. Of course, there are plenty of agents out there in Miami who will knock themselves out for you and get you a great house at a good price. Just consider how the real estate industry is set up, and what you may be up against.

Perhaps I have made my point so far. One way to circumvent making deals with agents who pledge allegiance to the seller is to find and choose to work with a “buyer broker,” which is an increasingly common practice in Miami real estates these days. The difference of dealing with a buyer broker is that you agree from the outset on what his or her professional fee will be. It will normally be extracted from the proceeds of the sale, so that you will not have to actually bring out additional cash in order to cover it. Of course, there is still an incentive for the buyer broker to prefer a higher sale price. Nevertheless, there are ways to work around such quandary.

When negotiating the broker’s professional fee, begin with the amount you expect to pay for your home. The next step is to apply 50 percent of the standard agent commission in Florida to it. For instance, if you are looking to pay $155,000 and the standard commission is 6%, you might offer 3%, or $4,650 as a fee. To make sure that the agent will actually work to find you the cheapest home price, offer to pay $100 extra for each $1,000 the agent saves you under $155,000. Put differently, if the selling price ends up being $148,000, you would pay $700 extra to the broker. Fees are absolutely negotiable. If you prefer not to negotiate a fixed price, you can possibly negotiate a lower-percentage commission. Just put in mind that these brokers want your business, and you can always take it elsewhere.

Lastly, make certain that you are familiar with exactly what you are spelling out in the contract. You have to understand the terms. You might examine it carefully to see whether you are expected to pay anything if a satisfactory purchase does not take place; or if there are any hidden expenses or fees. Also try to consider if you have agreed to mow the agent’s lawn for a year or pay for his car overhaul if a deal does not actually push through. It pays to be vigilant about these things, so that your interests would be very well guarded against opportunistic individuals.

In the process of buying a home in Miami , a buyer broker stands in for the buyer, not the seller. What many people do not realize is that traditional real estate agents are actually working for the interests of the seller of a property, not the buyer’s. This is the truth. These people are working with you, perhaps even spending many days in showing you dozens of homes. However, they are devoted more to the seller’s interests than the buyer’s. The underlying reason for this is economics–the commission that real estate agents get for completing the sale is a percentage of the selling price they extract from your bank account. Thus, it is to their advantage to sell the house at a higher price.

Earl Juanico

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Author: Piyawut Sutthiruk

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