Buyers Are Liars?

By Jim Palmer Jr.

There has been an offhand saying among Realtors® for many years that says “Buyers are liars!” How can a statement like that be fair, since it is obviously an over generalization?  Fair or not, there is a root cause to this perception. Maybe it is because buyers often exaggerate their financial ability, but I’m sure it mostly has to do with the extreme lack of loyalty that Realtors® experience among the ranks of buyers. Is that the fault of fickle buyers who just don’t see the need to be loyal, or is it the lack of due diligence by eager agents who fail to explain agency and who fail to obtain written commitments from buyers? I think it is a little of both.

One reason buyers may not seem loyal to brokers is that they may assume that they have to work with a listing agent who has a certain property listed (if they want to deal on that certain property) and so abandon an agent who has worked diligently to work with that list agent. Or maybe they feel estranged by their agent who doesn’t seem to be focused on just them. Maybe they are discouraged with their agent because they can’t seem to find properties to look at or they are not quick enough to compete with multiple offers in a frenzied market. (Companies like Zillow seem to exacerbate mistrust in agents when they continue to advertise unavailable properties so they can sell leads to Realtors®.  Discouraged buyers then wonder why their agent has not sent them these listings, even though the listings are bogus). Then there is the case of buyers who abandon their uncompensated agent who has worked many hours on their behalf just because they want to “change things up”.

One tool that may help buyers and brokers to bridge this gap of mistrust, is a Buyer Representation Agreement. Such written agreements bind the parties contractually and clarify what duties the broker has agreed to perform in exchange for an eventual payday.  Such a contract also asks buyers to certify that they have no conflicting agency agreements and specifies that the agency agreement must be terminated in writing. When a buyer understands they have a contractual obligation to pay the broker, they are less likely to cause mistrust by ignoring the compensation a broker has earned and moving on without just cause or notification.