First Time Home Buyer Mistakes When Working With A Real Estate Agent

Biggest mistakes first-time home buyers make
when working with agents How’s it going everyone Matt Leighton and
welcome back to another real estate video. Today we’re taking a look at mistakes that
first -time home buyers and home buyers in general are making when working with their
real estate agent. Now I’ve done videos before talking about
first-time home buyer mistakes when buying a house, what to avoid, what to look out for…this
video is going to be about the mistakes that buyers are making when working with their
real estate agent. We’re going to go through 5 mistakes, so
let’s begin: Number one on our list is working with the
listing agent. Let’s imagine you walk into an open house
and you realize it’s your dream home, you want to write an offer immediately and there
just happens to be a real estate agent in the home there for you. Wouldn’t it be easier to simply work with
that agent, whether they are the listing agent or someone on the listing agent’s team? Well usually in real estate, and in life,
the easy way is oftentimes not the best way that you want to go in. Going directly with the listing agent is one
of the worst first time home buyer mistakes for several reasons. The main reason is that you are giving up
your right to be represented. The listing agent will be in a ‘dual representation’
scenario where the agent is ‘representing’ both the buyer and the seller. The problem with this is that the agent cannot
provide advice on the market price, negotiating home inspection repairs, or anything other
than explaining the contract and sending paperwork back and forth between both sides. Another red flag is that dual agency is not
even legal in some states. If something is illegal in one state, how
is it in your best interest to do the very same thing in another state? Oftentimes the listing agent or builder’s
agent if it’s new construction will say that you can get a discount if you use the
listing brokerage. And you may get a $1,000 credit at closing
and feel like you have won. But if you’re a first time home buyer, you
don’t know what you don’t know. A good agent, not all agents, but a good buyer’s
agent can usually save you more money and provide better advice to you than had you
gone with the listing agent. This is probably the biggest purchase of your
life so far, so you’re going to want an agent representing your best interests and
someone who does not have prior allegiance to the seller. Number two on our list is not setting proper
expectations. And this goes both ways on the buyer side
and on the agent side. Both parties need to be upfront about their
intentions, goals and where the market is right now. One quick example of this is recently I was
working with a buyer that wanted to go out and see properties immediately. Usually I do a buyer consultation first to
understand more about the buyer, to show the buyer the value that I provide and to build
that relationship. This time I decided to skip the initial consultation
meeting because the price point was high and the buyer seemed motivated. After viewing the properties, he let me know
he wanted to write an offer. So I said great, email me what price you are
thinking and we’ll write up the offer, we’ll go through it together and submit it. Well instead of emailing me the price, he
emails me an offer that he wrote himself. It was barely 2 pages long, keep in mind that
most contracts are 20+ pages, the deposit amount he wrote in was about 1/10th lower
than the amount we needed and so we had to go back and start from square one. He was confused because he thought that he
was supposed to write up the offer and I’m sure you could understand my confusion but
it all goes back to not setting proper expectations. Things like what happens when I’m ready
to write the offer, what do we do if there’s multiple contracts, can I see the property
multiple times before writing an offer…Basic items need to be answered first that will
clear up a lot of potential confusion down the line. If you just start going and seeing properties,
without going through everything, once it’s time to actually write the contract, both
parties might be a little confused. Number three on our list is backing out of
3+ contracts. And I’m not here to force you to buy the
home. We have contingency periods, or periods of
time where you are able to back out of the contract with no penalty, we have those for
a reason. And you should use those periods to your advantage. But what I’ve found is that if you’re
backing out of 3 or more contracts, it’s no longer about the house, it’s about you. Let’s face it, depending on the type of
property you’re looking to buy, you might have your offer accepted only to do the home
inspection and realize the amount of money and work it would take to fix the property
up. And you may not want to undertake that project. Great, back out of the contract. That exact scenario may play out again on
the next home, great back out of the contract. But after the 3rd time you back out, in my
experience, the reason for backing out of the contract is no longer about the house. It’s about the buyer. I’ve even heard of buyers backing out of
8 contracts before. If this is you, you probably shouldn’t be
buying a house in the first place. There might be some sort of commitment or
purchasing objection that you’re weighing in your head that you need to take a hard
look at because you’re wasting your time and your money and maybe renting is a better
option for you instead. Again, I’m not here to say that you
have to buy the house. I’m simply saying, if you find yourself backing out of 3+ contracts
after your offer has been accepted, it’s time to take a look in the mirror. Number four is not communicating. Or better yet, not communicating effectively. I’m talking about late night phone calls,
asking to see a property with only an hour notice, consistently showing up to properties
30 minutes late. Sometimes traffic happens and someones late,
sometimes there’s a contingency that expires at 9pm and you need to have a late phone call,
sometimes a property comes on the market and you have to see it immediately. I’m not talking about these scenarios. I’m talking about consistent tardiness to
showings. Consistent late night phone calls where an
email that night or even the next morning would accomplish the same goal. Be sure you and your agent are both on the
same page when it comes to communicating. This includes the best way to communicate. Is texting the best way? Some people prefer phone calls, for others
its email. And again, going back to setting expectations,
be sure you and your agent know how late is too late to call, sometimes it is unavoidable. The reason that I’m harping so much on this point is because lack of communication
is the number one problem between buyers and agents. Be sure you talk about this so it doesn’t
become your number one problem. And finally number five on our list is using
your uncle as your real estate agent. And I say uncle but it could also be your
aunt, your friend, your friend’s aunt, or another relative or friend of a friend. Are you using them because you know them or
because they’re a good agent? You should never feel obligated to ‘do them
a favor’ or to use them because they’re family. Let me ask you this — If they weren’t
your friend, would you still use them as your agent? If they weren’t your Uncle, would you still
have done your research, asked around, looked at online reviews, interviewed 3 agents and
said to yourself, “Wow after doing all this research, Uncle Bill is the best Realtor in
my town for me”. Probably not. Look it’s family, it’s close friends,
it could get awkward. I get it. But it would be more awkward when you do use
them and they butcher your sale because they’re a part-time agent and only sell 2 houses a
year. Your buyer’s agent matters. Please do your research. If you are looking for a real estate agent
in your area, I’ve spent the last few years of building up a network of high-producing
agents around the country that I can get you in touch with. My contact information is below, send me an
email, and I can put you in touch with an agent in your area that I could guarantee
are probably better than your Uncle Bill. Thank you very much for watching. Hit the thumbs up button if you found this
video helpful and I’ll see you in the next one. Until next time, create a productive day. Take care.

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