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Did you know when you enter an open house, whether it is a pre-owned property or a model home in a new home area, and you register by signing a quest book or revealing your name, you may become a protected client of the registering agent and MAY NOT be able to seek your own advocate. Frightening isn’t it.
Open houses are held by SELLER’S agents. A seller’s agent LEGALLY represents the seller. In the case of new homes the agent or agents hosting the open houses may represent the developer as well as the builder of the model where the open house is held. If you register or reveal your name you may have effectively waived your right to representation to purchase any home in the subject area whether it is built or not. Most new home areas have a sign posted in the entrance that says, "We represent the SELLER."
How do you protect yourself? First and foremost seek a buyer’s advocate to represent your interests and not the sellers. In most cases, the hiring of a buyers agent does NOT cost you anything and in fact may save you thousands of dollars.
Every property listed with a realtor has a brokerage fee or commission included in the price. What many buyers fail to recognize is if you enter a property that is open and seek no representation and ultimately purchase that property, the entire brokerage fee is paid to the agent that represents the SELLER. If you must attend open houses, the best way to protect yourself is to inform the agent hosting the open house you have a buyer’s advocate. This is often a relief to the host agent in that the agent no longer is liable for the discovery process of the buyer’s agent.
What about for sale by owners (unrepresented sellers) and builders?" For sale by owners have two objectives. The first one is to sell the property and the second is to save the commission. For sale by owners are not obligated to abide by any code of ethics nor must they disclose anything detrimental to their position. Would you rather buy from a for sale by owner with no representation and risk paying too much for the property or have representation and have the seller pay your representative? The answer is clear.
In Kansas City most builders build in controlled subdivisions. The areas are controlled in that all lots within a given area are controlled by a developer who has a contractual agreement with a marketing agent (usually a real estate firm). An area is also controlled in that the developer restricts who may build in the area. Ordinarily a developer will not sell a building lot to an individual unless that individual is an approved builder. Most new home marketing agreements include language which states that no matter who buys any lot within the area, the marketing firm will be paid a commission on the lot price plus the price of the home constructed on the lot. In other words, you may go directly to a builder yet there is still a full commission included in the purchase price of your new home and the lot. By working directly with a for sale by owner or a builder you pay for representation which you DO NOT receive.
Whether you’re thinking about buying or selling or seeking information,
rely on RE/MAX Best Associates 800-391-BEST(2378) or 913-345-BEST(2378)
to provide accurate up to date information about the marketplace. info@kansascityehomes.com realestate-matters.com