If you’re looking to save money when buying a home, you may want to let only the listing agent represent you instead of having a buyer’s agent. It’s an unusual move, but one I’ve conducted three times. Overall, this strategy has saved me about $350,000.
In real estate, a listing agent is the person who lists a home for sale. With inventory down and demand up, having a listing is like winning a golden ticket. A prospective buyer normally has their own real estate agent for representation. Let’s call this agent the buyer’s agent.
An excellent buyer’s agent knows the market well in order to help their client offer the right price. The buyer’s agent should also know what type of landmines to look out for when purchasing a property. An experienced buyer’s agent is also a master negotiator.
However, the cost of using a buyer’s agent is generally half the listing agent’s overall commission. The standard selling commissions is now 5%, down from 6%. Therefore, the listing agent and the buyer’s agent each get 2.5% of the final selling price of the home. If you buy directly with the listing agent, you may get to save up to 2.5% off the purchase price.