On The Value of Buyer Agents: Beyond the Obvious

In the midst of the current reckoning in the real estate industry, the value provided by buyer agents is being called into question.

While many perceive the job of an agent as merely driving around and looking at homes—how hard can that be?—the reality couldn't be further from the truth. Buyer agents are some of the hardest-working professionals, whose expertise and savvy are constantly put to the test. They take pride in helping people make some of the biggest personal and financial decisions of their lifetime. Here are additional perspectives on the more hidden aspects of what agents do, highlighting their true value:

1. Ambassador to the World of Real Estate: Real estate in America is unique, serving as a significant driver of the American dream. Buying a home is both an economic and personal decision, representing not only the place you intend to live but also a substantial part of your financial future. A skilled agent can help navigate this complex landscape, ensuring that clients make the right choices and achieve their goals.

2. Dealmaker: Deals don't just go through on their own. Experienced agents understand that real estate transactions are 70% pushing the deal forward and 30% keeping it together. Sometimes, it's more like 70% just to keep things on track. In these transactions, it's typically the agent who takes the lead, working with all the partners like inspectors, lenders, title companies, etc., through the twists and turns of the process. They keep subpar partners on track when the lender fails to get final approval for the third time, or when title is late with their docs; they manage challenging buyers that have trouble making up their minds, they handle adversarial negotiations with the other side, and continuously push through to net the best deal terms on behalf of their clients. The ability to deliver positive outcomes in challenging situations is a core part of the job, yet often an underrecognized facet of a buyer agent's value.

3. On Call Availability and 24/7 Vigilance: In real estate, the saying goes that a deal isn't done until the ink is drying on the paperwork and the wire has cleared (or, in the age of remote online notaries, until the mouse has clicked and the computer has saved). With roughly 20% of transactions failing to close and under-contract timeframes often spanning a month or more, buyer agents must be on call 24/7 to keep things together. Whether it's dealing with a lender's repeated mistakes in the final loan approval, counseling an overwhelmed buyer at 9:30 pm on a Thursday night, or stepping away from dinner to handle the eighth call in a heated offer negotiation, good buyer agents step up, handle matters, and take care of business, oftentimes with great inconvenience and compromise to their personal lives.

4. Insurance Against Poor Decisions and Bad Outcomes: When a buyer puts an offer on a home and goes under contract, they embark on a due diligence process. This includes physical property inspections, legal history checks through title, and valuation double-checks with appraisals. However, it's easy for buyers to make the wrong decision, overlooking critical details or disregarding sage advice when their heart overrules their head. A significant part of an agent's job is to act as insurance, keeping a watchful eye over the buyer's shoulder to prevent them from making costly mistakes or letting bad things happen to them. Poor decisions in real estate can be especially painful, as homes are expensive, relatively illiquid, and the place where you spend most of your time.

Thriving in the real estate environment is no easy feat, which is why over 50% of new agents fail and the industry has such a high attrition rate. It's unfortunate that we as realty professionals often don't do a great job articulating these less obvious points where agents provide tremendous value. As the industry undergoes this reckoning phase and calls are made to align commissions with an agent's value proposition, let's make sure we are taking an honest assessment of what a buyer agent truly brings to the table.

Admittedly, the sin of the real estate industry is that there are too many agents to properly train, police, and hold accountable, and thus many end up with subpar skills and performance, or lack ethics and integrity, and some were even good at one point but got burnt out and turned into "lazy agents" that just do the bare minimum and get exposed the minute there is a complication in the transaction.

All of this has dragged the reputation of the industry down, whether justified or not, as well as invited some of the public ire. But the fact of the matter is a great agent can and does deliver the invaluable, and that is worth quite something.