Buy without a broker and get a rebate?
Selling your house without a real estate broker can save you a lot of money. But if you’re in the market to buy, is there any advantage to going it alone?
Home buyers typically don’t pay broker fees. In California, it’s customary for the home seller to spring for the fees of the buyer’s and seller’s agents. So it’s essentially free for prospective buyers to enlist the services of a licensed real estate agent for help searching for properties, crafting offers, negotiating and dealing with paperwork.
It’s best, though, not to assume an agent will show you all available homes for sale in a neighborhood. It is in agents’ financial self-interest to steer clients to listings that offer them high commissions. Do your own searching online and cast a wide net to include for-sale-by-owner properties and foreclosures.
A buyer choosing to be his own agent should do plenty of research, including picking up a copy of “How to Buy a House in California,” considered the gold standard for learning about the home-buying process.
The book, published by Berkeley-based Nolo and written by a lawyer and two real estate brokers, provides purchase contracts for making an offer and other forms.
A do-it-yourself buyer should also considering hiring a real estate attorney to review documents and to make sure all forms and disclosures from the seller are in order.
Lately, a growing number of savvy home shoppers are turning to services that will pay them when they buy a house.
Charles Lee and his wife wanted to move their family to Beverly Hills and spent two years visiting open houses, studying every new listing and getting to know “all the intricacies of the neighborhood.”
Twice, they used a real estate agent to put offers on homes and twice their offers were rejected.
“By that point, we had enough experience and we were already familiar with how a negotiation would go,” said Lee, a plastic surgeon.
So this spring when Lee was ready to make another offer, he called BuySide Realty Inc., an online brokerage that caters to self-reliant buyers. The company helped present his offer. When it was accepted, the firm helped him complete the transaction.
But instead of pocketing the buyer’s agent commission, BuySide rebated 75% of it -- $78,000 -- to Lee.
“Knowing that there would be an $80,000 rebate allowed me to feel comfortable paying a little extra for the house,” he said.
Lee cautioned, however, that his experience might differ from a first-time buyer’s because he had bought and sold a house previously.
“You really have to know all the steps in buying a house,” he said. “It’s more for someone who’s looking to trade up and had some experience.”
Other brokerages offering buyer rebates include Catalist Homes Inc., ZipRealty Inc. and Redfin.
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