Buyer Representation - Sedona AZ Real Estate

The National Association of Realtors' booklet entitled "Who is My Client?" reads as follows on page 9:

"Although disclosed dual agency relationships are technically lawful, there are compelling reasons real estate brokers should avoid creating them."

Benefits of Exclusive Buyer Agency

Avoids Dual Agency and Conflicts of Interest;
EBA Owes Complete Fiduciary Loyalty to Buyer;
EBA Has Access to ALL Properties on the Market;
EBA conducts an objective Comparative Market Analysis;
EBA Thoroughly Researches Property Positives and Negatives;
EBA Strives, Ethically, to Gain Bargaining Advantage for Buyer;
EBA Negotiates for Buyer to Get Optimum Contract;
EBA Protects Buyer’s Interests Throughout the Entire Process;
No Fees for Buyer Representation Services;
Buyer Often Saves a Lot of Money, Time & Peace of Mind

What is an Exclusive Buyer Agent/Broker?

Exclusive Buyers’ Agents are committed to working with buyers only and the companies by whom they are employed never represent sellers. As an Exclusive Buyers’ Brokerage, our firm, Buyer Brokers Realty of Sedona, does not take listings, nor do we ever practice Dual Agency. That is, we do not attempt to represent both buyer and seller simultaneously (Dual Agency). We owe complete fiduciary loyalty to the buyer. 100% loyalty, 100% of the time.

We do work with all listing agents in the area and are members of the local Multiple Listing Service. Beyond that we also work with most of the “For Sale by Owner” properties. Through us, you have access to the entire Sedona real estate market; whether you’re considering for homes, land, or commercial properties and businesses.

Our clients are often surprised that we don’t try to sell them the Sedona homes and land we show them. We usually do point out what we see as the good and bad points of various properties that we tour and our purpose is to help them find the one that will best suit their needs. We do tell our clients about what we think are the best deals, but have no vested interest in any particular property. We like that because it keeps us objective and focused on our clients’ needs rather than on pushing company listings. So, we don’t sell; there’s no need to. Our clients tell us what they like and when they are ready to put in an offer.

What is Dual Agency & why is it a disservice to buyers?

Say you’ve decided to have the “buyer specialist” at XYZ Realty represent you in your search for a new home. Everything is fine until she shows you, as she inevitably will, one of XYZ’s listings. It’s inevitable because she is likely to earn a bonus if she sells you one of her company’s own listings. Any time the focus of the search is on an XYZ listing, “your” agent transforms, by law, into a Dual Agent because she is now required to attempt to represent the seller as well as you in the transaction. It’s akin to having an attorney represent both sides in a lawsuit. I strongly believe it to be a great disservice to you, the buyer. At the very least, you have lost whatever advantage you might have had by employing a buyer’s rep as well as the agent’s objectivity regarding the property.

Why you are supposed to be given a Real Estate Agency Disclosure and Election Form during your first meeting with an agent?

“I remember the good old days when we all worked for the seller and everybody knew that we worked for the seller, except for the buyer.”   (Quote from an instructor of a Real Estate Agency course.)

The READaE form lays out the three types of agency relationships that are possible between the agent and the buyer: Buyer Agency, Seller Agency, and Dual Agency. It then asks the buyer to select which type of agency he/she prefers.

Click and take a look at the form and you’ll see why it’s required by law that the buyer be presented with it before the agent shows any property. The common practice here seems to be to present it at the time of writing an offer. That’s understandable because someone representing herself as a Buyer’s Rep doesn’t want to raise alarm in the buyer by bringing up the dilemma of Dual Agency until absolutely necessary. That, however, is way too late. The ethical and legal problem is that once the agent shows the buyer one of the company’s listings, he/she is operating as a Dual Agent. Practicing Dual Agency without full written disclosure is illegal and grounds for the agent losing his/her license. To read the full article from our newsletter go to When is a Buyer’s Agent Not?

Why is an Exclusive Buyer Agent a benefit to the buyer?

As Exclusive Buyer’s Agents, we at Buyer Brokers of Sedona can and do thoroughly research properties to discover assets and defects of a given home or parcel. Using our training in advanced negotiation techniques, we bargain hard for the best terms and price for the buyer. The natural tendency for buyers, when they see an attractive property advertised, is to contact the listing agent directly. Seems to make sense because, presumably, that agent knows the most about that property. Bad idea! The listing agent is contractually obligated to obtain the best price and terms for the seller. He or she must not divulge any weaknesses in the seller’s negotiating position. Nor can a dual agent. An Exclusive Buyer’s Agent, on the other hand, can and should use every legal and ethical device to obtain the most favorable outcome for the buyer through every step in the property buying process. That is the objective to which we are committed.

By the way, before coming to view property in Sedona, you may want to review your bargaining strength by taking our Negotiation Position Inventory. Additional information regarding negotiation strategies can be viewed from our newsletter article: The Art of Negotiation.

Do all “Buyer Agents” provide the same service and loyalty?

In the past few years, because buyers are increasingly demanding buyer representation, just about every real estate agent in Sedona has been advertising him or herself as a “buyer agent,” “buyer’s rep,” “buyer specialist” or “buyer’s broker.” Even more problematical for the buyer is the “Buyer Specialist” who is a member of a team that is headed by a top producer who is the Listing Specialist. As should be expected, one of the priorities of the Buyer Specialist is to sell the team’s listings.

All this makes an already confusing concept even more so. A word or two, then, needs to be addressed to differentiating true buyer agents who represent buyers exclusively and those who continue to practice dual agency. If you were to ask the vast majority of so-called “buyer agents” the question:

“Does your firm have real estate listings and do you ever practice dual agency?” -

you would likely get: “Yes, but...”

Here’s the reality of that:

The larger the firm (and the more listings it has) the more likely it is that a dual agency situation will arise and that agent will not hesitate to sell you his/her firm’s listing.

Buyer Brokers Realty of Sedona is unique among Sedona real estate companies in that we are Sedona’s only practicing member of the National Association of Exclusive Buyer Agents (NAEBA). We, as agents, are Sedona’s only active EBAs (Exclusive Buyer Agents).

As long as the choice comes down to true buyer agents, your decision as to whom you want to work with is a matter of personal comfort level and confidence. But, do be careful of “buyer agents” in name only. The ABR (Accredited Buyer Representative) designation does not require that the agent represents buyers exclusively and fewer than 1% do nationally.

Are your fees high?

We do not charge our clients a fee for our services. We are paid from the proceeds of the transaction. To see more on how that works, click on our remuneration link.

Do You Charge a Retainer Fee?

No, but we do ask serious buyers to obtain written Credit Pre-Approval if they’re not paying cash.

The practice of charging retainer fees, typically $500 to $1000 or more, deductible against the agent’s eventual commission, is gaining popularity among Exclusive Buyer Agents. The rationale for it is threefold:

1. To cover some of the agent’s up-front time and expenses in representing the buyer;
2. To screen out those prospective buyers who are unprepared to commit to the process;
3. To bind the buyer to the agent.

We find that the majority of buyers need some time to check out the area, the market, and us before they’re ready to get serious - although we do have more than our share of people who know instantly that this is the place they want to live. It has also been our experience that once we have begun to work with clients and we’ve gotten to know each other, we have not had them go off and work with someone else. So, we don’t feel insecure about that issue. Once they are ready to work with us, though, we do ask two things of them. The first is to sign the state standardized Buyer’s Agency Disclosure and Election form. The second, unless they are cash buyers, is to work with a lender to obtain a Line of Credit Pre-Approval as soon as possible. Please refer to our mortgage page for more information and links to lenders.