Going to make an offer on some land this week, for a future Self Storage location in Texas.
We found the land by driving by and called the Realtor. We're not working with a realtor when we found this property. We do have a different realtor who helped us look at several other properties.
On the offer contract, it notes the Realtor is acting for the Seller. I did not note a Buyer Realtor.
Will have both my attorney and Banker look over the documents, although this is a straight forward purchase with a little Earnest money, and very little due diligence.
Should I let the Realtor have the full commission? $350,000 asking price. Or bring in the other Realtor. Will probably not work with this Seller realtor in the future, but will probably work with the other realtor. Only benefits of bringing them is they review the transaction, which is on a Texas State form; and they should be more than useful in the future since they got a commission without doing any work.
Please give input. Thanks.
Honestly, it seems you have things covered with the lender and lawyer to make sure you're good, but having a realtor may work in your benefit if you feel they could find you deals in the future and thus foster a relationship with them buy letting them in on this deal. You can use this time to screen for a good realtor to have on your team who will want to help you in the future with deals by letting them in on this one. Hope that's helpful
Personally I would have a great local realtor on my team to make any offers. I often tell people I am licensed in Texas, but if I were to buy in a lot of places I would use a local realtor. I can do lots of things myself looking at property, due diligence, reviewing contract, etc, but I don't know the 1st thing about San Antonio, Houston, El Paso, Amarillo and lots of other places. A great local realtor might know 1000 things you and I don't know. Where the next school will be built, what companies are coming to or leaving town, the "unknown" stigmas of living or buying on this or that side of the tracks. I'm sure you've been places where you know people who bought in X neighborhood and you can hear the collective gasps in a crowd when you tell them where you bought...good or bad.
In this case I guess you represented yourself.....and let the other realtor represent the seller only. They got the full commission. I'd always get local representation. I think at worst it doesn't cost you anything, and at best can save your full investment or more.
Legal review is not always easy to find here. If you do that make sure you use a board certified real estate attorney. Too many of the general lawyers will just get you in trouble. Many attorneys also are not really familiar with the market I think they will tell you, so can't really advise on price, or even what is normal to fill out in the contracts for option money, earnest money, review times, etc.
Your realtor may or may not be able to tell you contractors to use or not to use, have relationships with great lenders who can save you thousands, or all the other venders and trades you might need or want.
It sounds like you answered your own question.
You want to let a realtor in that is going to be selling something that you want the inside track on.
I would be interested in learning more about your self storage deal please.
Where is this land lot in Texas? I am a licensed RE agent in Texas and specialize in land lots in Dallas-FortWorth metroplex and in & around Austin. I closed several transactions and also have land listings
You should talk to City or County to see what would be allowed, usage restrictions, utilities etc. Also carefully review deed restrictions, easements etc
Its not a matter of you "letting the Realtor have the full commission" - the commission rate is between the seller and the listing agent, you have no say over it. If there is a buyer's agent involved then the split between agents is as specified in the listing, and if the buyer is unrepresented then the listing agent keeps the full commission.
So since there is no cost to you to have buyer representation, and the commission doesn't change either way, why not bring your buyer agent on board from the beginning? This way you'll have someone in your corner, and also strengthen your relationship for future deals.
Commission paid by Seller. You can negotiate taking the "buyer's agent" commission off the sales price by offering to not bringing in a buyer's agent. If the seller's agent refuses, you bring in any buyer's rep and the seller's agent will be forced to split the commission.
Same happens with lawyers and RE agents/brokers. Texas bar licensees are exempt from TRELA. Brokers are prohibited from paying commissions to anyone but a TREC licensee. But attorney's fees can be paid on a settlement statement by the buyer/client with a credit to the buyer from the seller. Seller's broker commission reduced to what they would get if there was a buyer's broker.
Thanks for all of your input. Its a new market for me, that my friend lives in (hasn't ever needed a realtor). Timing thing, we looked at about 10 properties. Found this one with the road sign. Along the way we found a Realtor we want to use in the future, really responsive and really knows the type of properties we are looking for.
Using a buyer's Realtor has never really been an issue for us. About 4 of our buys we have dealt directly with the owners and gone through an attorney. The other 4 we went through our local realtor, who is both our Neighbor and friend. I trust him to the degree he has called me into his office with a contract and told me to buy it, which we did.
For the deal info, look at my Commercial section post. Self Storage- Deal 11 Can't give details yet as there are two deals in the storyline, waiting to close, and I don't want to impact either one.
Thanks again folks. I grew up in Louisiana and Texas. Doing this property search was actually challenging and exciting. Although my friend told me most counties in Texas had no Zoning, I couldn't comprehend it. Once I got down there and it registered I had to change the way I analyzed properties from both a location and a Risk assessment standpoint.
@Jerel Ehlert Just trying to game that out, if I were the listing agent, and someone wanted to shoehorn in another realtor at the last minute. As an independent broker, I'd probably just tell them I'm not splitting the commission with the fake buyer's agent, and if they try to bring in another realtor, tell them the other realtor is not the procuring cause of the sale. No commission split. When they throw a hissy fit, I'll tell them they can file for an arbitration hearing in accordance with the MLS rules if they really feel like they deserve the commission, but I'll bring up the attempt to negotiate the commission split downward and the "threat" to bring in another realtor if I don't acquiesce as further evidence that the other realtor was never a procuring cause. At the end of the day, I know the buyer wants this property, they are sophisticated and well-funded, and they aren't going to let a good deal slip by because they can't get another 3% discount off the purchase price. So if it was me, I'd just tell everyone to go pound sand. I know when all the crying is done, I'm going to keep the full 6% percent commission and not splitting it with anyone.