What's it all about Alfie? I ducked into a real estate forum today and was reminded how confusing relationships can be. No not that kind; the one you (have?) With your broker. It can be quite confusing, does your broker have your back? Well my reading on this matter would suggest that the broker dragging you around to various listings is in fact a sub-agent of the listing broker. But here in NYC you may actually be paying his fee. This presents a very "scratch the head" kind of situation.
The weight of fiduciary responsibility may in fact all be directed towards the "owner". Where does that leave you? There is a remedy for this situation; have your broker sign an agency agreement with you declaring his allegiance to serving your best interests.
Currently we all make a lot of assumptions. We call an ad listing an apartment for rent, of course it was just rented. Then the broker takes us around and shows us a bunch of various other listings(most of which are totally irrelevant) to what we asked to see in the first place. We assume that if we are paying a fee to "our broker", he's working for us, has our back.
That could be the case, but mostly brokers have their own backs first. "No sign on the line that is dotted, no money". Which can lead to some very ugly circumstances like can't pay rent or take significant other out to dinner; we get evicted and "S.O." Leaves us. So there is the "agency" relationship and the anecdotal relationship we sort of assume, the way business gets done in the "real world" some might say.
Because of advances with technology which has made listing data available instantly to virtually anyone with an internet connection, new problems are arising. Most brokers are operating under a model that was developed when the "listing room" was lined with cork and listings were literally pinned to it. Big firms are going to have to change and not just utilize technology to market their brand to the world. Of course you are going to be resentful if a broker takes you to see an apartment that you later find on StreetEasy yourself and he wants to charge you seven grand! a big part of the blame lies with the way big(most) firms compensate their brokers, it leaves very little room to get creative. For instance if I am working with a client that does not want to pay a fee and we come across a "collect your own fee" listing, I will have arranged to charge them a flat fee, maybe $500-$1000 dollars. This way I am compensated for my time and effort and the client gets to see/rent just about everything and charged a fair fee for services. The other alternative is not to use a broker, but for the right price it can be a very useful service. Sure this can be quite a bit less than a traditional "full fee", but times have changed and there are plenty of other deals where my compensation is greater. To date this has been working out very well for me and I am having one of my best years in a very weak market. Change and innovation fueled by advances with technology!
So before you go out with "your" broker get the whole relationship thing out of the way(money). I think we will all be happier in the end if we have clear,transparent definitions of where we all stand. And please read and understand the "fee agreement" a broker may ask you to sign before venturing out with you.
0 comments:
Post a Comment