Do You Need to Hire a Real Estate Agent to Buy a House?

Buying a house is a huge step for many people, as it’s one of the biggest financial decisions you will ever make. But you may be wondering: do I need to hire a real estate agent to buy a house? Is it possible to buy a house without a real estate agent?

While it’s possible to buy a house without a real estate agent, doing so usually isn’t in your best interest. Even if you know the seller personally or are purchasing a For-Sale-by-Owner, you should always seek out the help of a licensed real estate agent to help you buy a house. This is especially true for first time homebuyers who aren’t familiar with the process.

What is a Real Estate Agent, and What Do They Do?

A real estate agent is someone who is licensed to help you buy, sell, or rent property in a given state. With the advent of home buying sites, like Zillow and Trulia, it was thought that real estate agents would be rendered obsolete, as for the first time, shoppers could browse local listings from the comfort of their own homes. But real estate agents do more than just find homes for their clients.      

Buying a home is a lengthy and sometimes confusing process, especially without the help of a real estate agent. If you were to represent yourself as a buyer, you would need to:

-Research homes online, then tour them in person by contacting the listing agent.

-Hire a real estate attorney to help you review and understand legal documents.

-Perform market research to make a solid offer on a home.

-Write up your offer, including your contingencies and timeline. This offer becomes legally binding once it is accepted, signed by the seller, and delivered back to you.

-Deal with inspections and appraisals on your own.

On the other hand, when you work with a real estate agent, you don’t have to do any of this work. Your agent will not only send you listings that match your search criteria and take you on showings, but they will also do the heavy lifting that comes with putting an offer on a home.

Your agent will help you come up with a strong offer based on neighborhood comps and other criteria as well as write up and submit your offer to the seller’s agent. If the seller counters, your agent will help you decide whether you should accept the counteroffer or counter back—and at what price.  

Real estate agents are trained to negotiate and can help you lock in a deal. They also are familiar with contract wording, know what contingencies you should include in your offer, and can help answer any questions you may have about the homebuying process.

While you may be able to view local listings on your phone, real estate agents have access to more information via the MLS database, which includes homes that haven’t yet hit the market and is more frequently updated than public homebuying sites. In addition, real estate agents are well connected and can recommend trusted lenders, home inspectors, or appraisers for you to use.

What Does Hiring a Real Estate Agent Entail?

Don’t let the word “hire” deter you from working with a real estate agent.

If you’re concerned about the costs associated with hiring a real estate agent, understand that buyers typically don’t have to pay any realtor fees. Most of the time, the seller will end up paying these fees at closing. Some buyer’s agents may require a small administrative fee upfront, but this typically isn’t more than a couple hundred dollars.

Beside paying a possible administrative fee, the only other thing you will need to do when hiring a real estate agent is sign a buyer representation agreement. This contract protects both you and the agent by delineating the expectations of your relationship.

Most buyer representation agreements require that buyers work with an agent for a specified amount of time. This is to protect the agent from being exploited for their services.   

Keep in mind that a buyer’s agent essentially works for free. Buyer’s agents research listings, show homes, and write contracts without any compensation. They are only paid at closing, after weeks—sometimes months—of hard work. Agents want to be sure that their clients won’t exploit their services, then hire another real estate agent behind their back or put in an offer on their own.

This contract also holds your real estate agent to a higher standard, ensuring that they will work for you under the specified conditions. Once you sign this contract, your real estate agent has a fiduciary duty to you.

You may be asked to sign this agreement before the agent shows you any homes. Some agents will wait until you’re ready to put an offer on a home before asking you to sign this agreement. Either way, make sure you read the contract carefully and discuss any questions you have with your agent.

A Real Estate Agent is an Advocate

Beside the fact that you’re essentially receiving a free service, the biggest benefit of hiring a real estate agent is that it gives you an advantage in the homebuying process. When you hire a real estate agent to represent you, you’re hiring an advocate.

Your agent will ensure that you are treated fairly, that you have all the facts and understand all the risks before signing a contract, and that you are kept up-to-date during the homebuying process.

Real estate agents are trained and knowledgeable professionals who know the homebuying process inside and out. When making such a huge personal and financial decision, you want someone in your corner who can answer your questions and make sure you are protected.

If you’re thinking about buying a home and need to hire a real estate agent, reach out to any one of our experienced agents today. We’d be more than happy to work with you to help you purchase your home!