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Hiring the right real estate agent makes all the difference in a successful real estate transaction in Lake Travis and Austin.

You also need to understand who's side an agent is on when you buy or sell a home and move towards closing.

There are a number of ways agents may represent clients.

By knowing where your agent’s loyalties lie, you’ll know what you can tell her and what you can’t. If, for example, you’re dealing with an agent who doesn’t represent you but is representing the sellers of a home you want to buy, you won’t want to tell her how high you’re willing to go on the price.

No matter what form of representation you agree to, or where you live, watch out for your own interests and understand the six ways brokers and agents represent clients below.

Buyer’s Agency

Do you want the agent to represent you and only you when you buy a home so that all the information you share with her is confidential? Opt for an exclusive buyer’s agent.

Who pays the buyer’s agent? Surprisingly, even if you hire a buyer’s agent, you can still ask the sellers to pay his fee. You can pay your buyer’s agent yourself, or ask the seller (or the seller’s agent) to pay your agent a share of their sales commission.

Seller’s or Listing Agency

An exclusive seller’s agent represents only the sellers, not the buyers. If your exclusive seller’s agent finds a buyer for your home, he may have another agent - maybe even a co-worker from the same brokerage - represent the buyer in your transaction. In some cases the buyer may have no agent at all. Your exclusive seller’s agent is loyal only to you, so it’s OK to discuss strategy with him.

Who pays the seller’s agent? The seller pays a commission to the seller’s agent from the proceeds of the sale. The seller’s agent may, and often does, share the commission with the homebuyer’s agent.

Dual Agency

In many states, agents can represent both the buyer and seller. These dual agents seek to bring both sides together. They can’t do something that’s only good for you and not for the other side.

A dual agent situation often arises when one agent represents the buyers and the sellers of the same home. The agent must disclose the relationship and, in many states, you must agree in writing to such dual representation because of the potential for conflicts of interest. While dual agents have an obligation not to share any confidential information of a client without their permission, be sure to inform the agent that the information is confidential and know that any non-confidential information may be shared with the people on the other side of the transaction.

Who pays the dual agent? Usually the seller pays the commission.

Designated or Appointed Agency

What happens when the buyer’s agent and the seller’s agent both work for the same broker?

To make sure both sides of the home sale are treated fairly in this situation, some brokers designate an agent in their company to represent only the buyers and another to represent only the sellers. A designated agent or appointed agent will be loyal to you and only you. The strategy helps avoid a dual agency situation.

Who pays the designated agents? The sellers pay the commission and the designated agents share it.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.

5 Reasons Not to FSBO

by Rebecca Shahan

In the modern real estate market, as home prices rise and inventory is lower, some home sellers might consider trying to sell their home on their own, which is referred to as a For Sale by Owner (FSBO). If you plan to sell your home, should you sell it on your own?

Here are the top five reasons why selling as a FSBO is not a good idea:

1. Exposure to Prospective Buyers

Do you have a marketing strategy and network that will expose your home to the widest market? Putting up an ad on Craigslist or Facebook doesn’t count. Most real estate agents have an internet strategy to promote your home and expose it to a nationwide network. Do you?

2. Results Come from the Internet

Where did buyers find the home they actually purchased?

49% on the internet

31% from a Real Estate Agent

7% from a yard sign

1% from newspapers

Putting a sign on the front lawn and putting up an ad in the paper are the least effective means of selling a home these days. Having a strong internet strategy is crucial.

3. There Are Too Many People to Negotiate With

Here is a list of some of the people with whom you must be prepared to negotiate if you decide to For Sale by Owner:

The buyer who wants the best deal possible

The buyer’s agent who solely represents the best interest of the buyer

The buyer’s attorney (in some parts of the country)

The home inspection companies, which work for the buyer and will almost always find some problems with the house

The appraiser if there is a question of value

4. FSBOing Has Become More And More Difficult

There is a ton of paperwork when it comes to selling a home, due to industry disclosures and regulations having become mandatory. This is one of the reasons that the percentage of people who sell as FSBO has dropped from 19% to 8% over the last 20+ years.

5. You Net More Money When Using an Agent

It may seem as if you’re saving money by selling your home on your own because you’re not paying the seller’s commission. But the fact is that the seller and buyer can’t both save the commission.

A study by Collateral Analytics revealed that people who sell as FSBOs don’t actually save anything, and in some cases, may be costing themselves more. One of the main reasons for the price difference at the time of sale is:

“Properties listed with a broker that is a member of the local MLS will be listed online with all other participating broker websites, marketing the home to a much larger buyer population. And those MLS properties generally offer compensation to agents who represent buyers, incentivizing them to show and sell the property and again potentially enlarging the buyer pool.”

Using an agent will expose your home to more buyers, and as such the greater the chances are that there could be a bidding war. The study showed that the difference in price between comparable homes of size and location is currently at an average of 6% this year.

Why would you choose to list on your own and manage the entire transaction when you can hire an agent and not have to pay anything more? 

If you decide to use an agent to sell your home, we would be happy to work with you to get the highest price possible for your home for sale in Lake Travis, Lakeway, and Austin.

Check back on our blog twice a week for more real estate news, ideas, and local events in Austin and Lake Travis. You can search for the perfect home on our website using our powerful home search tools. You can also get free listing alerts of homes as they hit the market at WelcomeToLakeTravis.com. And you can always feel free to call us at 512-657-4467​ to talk to an experienced agent today.  

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