Long story short, no, you do not need a realtor to buy a home.
However, when looking at the pros and cons of having a realtor, most people would probably benefit from the support of a buyer’s agent. Buying a house is complex, and there’s a lot of questions along the way—and a lot of mistakes people can make if they’re not careful. While this was a no-brainer in the past—sellers covered the cost of the buyer’s agent, typically—this math gets a lot more complex after the rules around compensation changed. So we’ll take a look at what you really need a professional agent to support you with, and then you can decide whether that’s something you can try to figure out on your own.
What do buyer’s agents do?
Buyer’s agents are your go-to for finding the right home and making sure your interests are protected. They’re legally bound to advocate for you every step of the way, from the start of your search to closing the deal.
| What agents do | Pros of DIY buying | Cons of DIY buying |
| Find houses, using MLS listings in the area. | Most agents are geographically focused and you should cast a wide net when looking for a home (so you have more options). Search portals like this one have all the same info (or more) than your agent will have access to. | You might not have “insider” awareness of places that haven’t yet hit the market. |
| Help prepare an offer and negotiate on price and terms. | Yes, technically. | No. There’s a wide range of ways to negotiate and having more familiarity with the market can help a lot. |
| Handling Paperwork | You’re in charge. You control the deadlines, documents, and follow-ups. | The paperwork can get overwhelming fast. Mistakes or missed deadlines can mess up the whole process and even cost you the deal. |
| Invest their full time efforts | You get to browse and schedule everything on your own terms. | DIY homebuying takes a lot of time—viewing homes, handling the back and forth, chasing down paperwork. |
| Emotional Buffer | No middleman. You can talk to sellers or listing agents directly without going through an agent. | Agents act as a buffer during stressful negotiations. They take the heat off you when things get tense or emotional. |
With their insider knowledge, they help you lock in the best terms on price, contingencies, and closing costs, making the whole process smoother.
What about Seller’s Agents?
Seller’s Agents: On the flip side, seller’s agents work for the seller, with one goal—selling the property fast and at the highest price. They take care of:
They handle:
- Listing and marketing the home
- Organizing open houses and showings
- Advising on pricing strategies
- Managing the negotiation of offers and ensuring the entire transaction runs smoothly until closing.
How can I find a realtor?
Our top tip? If you know someone who’s already bought a home in the area, ask if they’d recommend their realtor. Getting a referral from someone you trust is gold. If that’s not in the cards, do some homework—look up reviews for realtors nearby and make a few calls. It’s smart to talk to a couple different agents to see who you vibe with and who really knows the neighborhoods you’re targeting. That connection and local expertise can make all the difference.
What is the difference between a good and bad realtor?
A good realtor is like your inside track to the housing market. They keep you in the loop, always making sure you’re up to date on every step of the process. They really listen to what you’re looking for, only showing you homes that hit the mark. Plus, they know the local market inside and out—neighborhoods, pricing trends, what’s worth your time, and what’s not. They’re not just there to close the deal; they’re in it to get you the best price, the right terms, and make the whole thing as seamless as possible. You’re never left guessing because they’ve got your back from start to finish.
On the flip side, a bad realtor? They’re just going through the motions. You’ll be left chasing them for updates, and they’ll push homes that don’t even come close to what you want. They might not have a clue about the local market, which can mean bad advice that costs you in the long run. Worst of all, they’re disorganized, missing paperwork, and cutting corners, which only makes the process messier and more stressful. It’s clear they’re more focused on getting paid than making sure you’re happy with the deal.
What are the risks of not having a realtor?
Skipping a realtor when buying a home? That’s a gamble you might regret. Without a pro on your side, you’re risking overpaying or making a weak offer because you’re missing out on crucial market insights. Realtors have the inside scoop on listings and can spot opportunities you’d otherwise miss.
When it comes to negotiations, you’re on your own. That means you might not even know to ask for seller credits, repairs, or other perks that could save you a lot. Plus, the paperwork can be a minefield—one misstep could blow the whole deal.
And let’s be real: buying a home is likely the biggest purchase of your life. Do you really want to leave that up to chance? Without a realtor, you’re vulnerable to getting taken advantage of by the seller’s agent, whose job is to secure the best deal for the seller, not you. A realtor is your safeguard, ensuring you don’t get stuck with a bad deal.
Of course, if you’re a seasoned buyer who’s bought and sold homes multiple times, you might feel confident enough to go it alone. Just make sure you fully understand the risks involved and are prepared to handle them.
Should I use the seller’s realtor to avoid paying commission?
Using the seller’s realtor to avoid paying commission might seem like a smart move, but it’s a gamble that could backfire. The seller’s realtor is committed to the seller’s best interests, not yours, aiming to secure the highest price for the property, which could put you at a disadvantage in negotiations.
Without your own agent, first-time buyers might struggle with overpaying, negotiating effectively, and accessing the best inventory. While avoiding commission fees might seem appealing, it can lead to missed opportunities and higher costs.
Given the new commission structure, where the seller no longer covers the buyer’s agent commission, it’s understandable that many buyers might want to avoid these fees. For instance, with the cost of a buyer’s agent now potentially coming out of your pocket, you could face an additional $4,500 to $13,500 in fees for a $450,000 home—on top of your down payment and closing costs.
Despite the appeal of saving on commission, investing in your own realtor typically offers better value. They provide dedicated representation, protect your interests, and help ensure you get the best deal possible, ultimately saving you from potential pitfalls and additional costs.
How does paying a realtor a commission impact my closing costs?
Paying your realtor’s commission can impact your closing costs in a few different ways. With the new commission structure for buyer’s agents starting August 17th, 2024, a lot is still up in the air about how commissions will work. You might end up paying your buyer’s agent’s commission directly, which could be a percentage of the home price, a flat fee, or an hourly rate—whatever you agree to in your contract before you start touring homes.
Right now, buyer’s agent commissions are usually around 2.5-3% of the home’s price. For a $450,000 home, that’s about $11,250 to $13,500. However, with the new structure, some experts anticipate that commissions might drop closer to 1%, which would be around $4,500. If you’re buying in a buyer’s market and the seller is eager to close a deal, you might be able to negotiate for the seller to cover your buyer’s agent fee as a concession. Just be sure to factor this potential commission into your overall closing costs budget, so you’re not left high and dry if negotiations don’t go your way, especially if the house you’re eyeing is getting a lot of interest.
Can I negotiate a realtor’s commission?
Yes, you can definitely negotiate a realtor’s commission. Before you start hitting the open houses, you’ll need to sign a contract with your agent. This is your chance to hammer out the details and negotiate a commission rate or fee that suits your budget. Make sure you’re clear on what you’re comfortable with and what you can afford. This is your moment to get the best deal and avoid any surprises down the line, so don’t be shy about getting the terms that work for you.
Can I change realtors if I’m unhappy with the service?
Yes, but there’s a catch. Since August 17, 2024, when you go out touring homes with an agent, you’ll sign a contract with them. Once that contract is signed, you cannot switch agents until the contract expires. For this reason, it’s important to have conversations with multiple realtors before signing anything.
Another workaround is to sign a contract for a shorter period of time. For example, you could sign a contract with a realtor for a week to try out touring homes and see if you mesh well. If you do, you can go back and sign a longer contract for them to take you through your home-buying journey, or choose to explore other options if it’s not a good fit.
If you’re ready to start your journey to homeownership, get pre approved with Tomo Mortgage today.