What is a real estate rebate?  Home buyers can negotiate discount savings when buying real estate with their real estate buyer broker.  Real estate commissions or fees should not be fixed and are negotiable. Since commissions are negotiable, buyers can negotiate a discount in the form of a buyer broker rebate when buying a home with a buyer broker.  Many home buyers do not understand this and miss the opportunity to save money when purchasing a resale home or from a new home builder.   

How can the rebate savings be accomplished? For example, if you are planning  to buy a home that  is worth 0,000 that is listed in the MLS (multiple listing service), the commissions offered in the MLS may vary, but in this instance, let’s assume it is 3%.  Total commissions paid to your buyer broker would be ,000.   If you negotiated a 50% rebate, then your broker to buyer rebate would be 1.5% of the sales price or ,500.  As you can see, this real estate rebate can provide significant savings as the buyer broker is discounting the fees that he/she receives and rebating the difference to the home buying consumer. Clearly, real estate rebates are essential to price competition amongst real estate buyer brokers. 

Why is the buyer broker discount in the form of a rebate? Buyer broker’s fees or commissions are typically paid by the seller and built-in to the sales price, cash back or rebates from your real estate broker are the principal method by which a buyer’s broker can negotiate a discount otherwise the commissions on the buyer’s side are essentially fixed.  As such, broker to buyer rebates are morally good because such rebates are the principal method by which a buyer’s broker can negotiate or discount their commissions.  Buyer broker rebates are good for the consumer because these rebates reduces the cost of housing for the consumer and promotes healthy competition and innovation amongst real estate brokers.  As such, cash back at closing from your real estate broker  is one way to reduce your home purchasing costs.

Is cash back at closing from your real estate broker legal? Yes!  The “built-in” buyer broker commissions are negotiable (not fixed) as rebates or cash back from your real estate broker are legally protected by federal anti-trust laws (U.S.A. vs Kentucky Real Estate Commission).  In fact, the Department of Justice has indicated that such broker to buyer rebates are beneficial to the home buying consumer and are “key to broker competition”. According to the Department of Justice, real estate broker rebates or cash back to buyers makes home purchases less expensive.   It should be noted that there a few lingering states which still have a “rebate ban” in place even though there is no justification for such a law. If you reside in such a state, it would be a good idea to contact your state legislature and request that they change the outdated law which impairs fair trade, price competition, and artificially inflates the home buying costs for consumers.   

Overall, buyer broker rebates on resale and new home purchases are a smart way for home buyers to save money when purchasing real estate. Cash Back Realty offers real estate rebate savings to home buyers for real estate home purchases.           

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Wealthy home buyers who buy multi-million dollar homes are typically self-made millionaires with new money, according to a recent online survey of 683 Coldwell Banker Previews International property specialists. The study revealed the top professions of these affluent customers. According to the respondents, 88 % of their customers are business or corporate executives, 37 % are physicians, 31 % are lawyers, 30 % are financial professional and 14 % are entertainers, entertainment executives or professional athletes.

Wealthy home buyers require their real estate agents to be equipped with special skills, according to the Coldwell Banker’s survey. Given the magnitude of the financial transactions involved in luxury home purchases, 78 % of sales associates said that the top most need their clients require from their real estate agents is privacy and confidentiality. The luxury customers also want their real estate agents to exercise discretion while dealing with their multi-million dollar transactions. Almost 70 % of respondents polled that their wealthy clients want their real estate professionals to offer customized services while 44 % said that the luxury home buyers want their agents to have good network and work relationship with executive assistants, CPAs and attorneys.

Wealthy home buyers also want their agents to know the inside scoop on the real estate market, according to 36 % of the respondents in the Coldwell Banker’s survey. Seventeen percent of the sales associates surveyed indicated that one of the necessary skills for real estate professionals working with affluent customers was the ability to provide emotional support to their clients. And according to 11 % of respondents, luxury customers want their real estate agents to establish personal rapport with their clients.

The study also included queries on the “must have” amenities that the affluent clientele want in their luxury homes. Wealthy home buyers want media rooms in their homes, according to 60 % of respondents and another 60 % polled that their affluent customers want “wired” homes. However, there are a few home design elements that are out among luxury home buyers. Gourmet kitchens, granite countertops and wet bars are no longer counted as luxuries by wealthy home buyers, according to the survey respondents.

The survey also found that the multi-million dollar home buyer pays a typical down payment of 20 % to 30 %, while a quarter of clients put down 30 % to 50 % of the sale price.

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Expired Real Estate Listings have been the near exclusive domain of real estate agents for as long as I can remember. Top producing agents know that expireds don’t require a lot of effort to get, yet yield a high return on their time and money invested in marketing them. And all you have to do to find them is log into your MLS system, enter the dates that you’re interested in and presto – there they are.

But the days of exclusivity may be drawing to a close, as buyers and investors are competing for those same expireds. They too are starting to realize that expireds offer special opportunities for them as well, but instead of listings they get to bid on properties that are all of a sudden off the market and may be reduced by at least the cost of the real estate listing fee, which is no longer in effect because it expired, too.

But buyers and sellers are at a distinct disadvantage when it comes to expired listings- they don’t have easy access to the MLS system. They can’t just log into the MLS system – they don’t have access to it.

Instead, they have to be a little more innovative. Some sign Buyer Broker Agreements, whereby they hire and pay agents to help them buy real estate. And since the agents will get paid by the buyer they can then expand the properties shown to their prospective buyers to include expired real estate listings, fsbos and even properties that are actively listed in MLS systems.

Suddenly, buying options for buyers and investors expand threefold. Agents are now free to show them almost any property on the market and the Buyer Broker contract ensures that they’ll get paid.

The concept is a little unorthodox, and is not utilized by many, but those that do know about it are finding that there are more buying options than they would otherwise have.

My first Buyer Broker experience was as an agent and it was a wonderful experience. At the time I was struggling to pay gas to usher clients around town to look at houses, only to have them walk away without buying anything, or go on to another agent and buy something.

And what was so good about it is that I got a pretty sizeable non-refundable retainer fee, so if they had walked away I would have felt adequately compensated for the time spent with them. But I didn’t have to worry about that because they ended up buying a home and I got a full fee for my services.

So, listen up buyers and investors. If you’re looking for a great deal you might want to seriously retaining an agent to search expired real estate listings for you, which can in some instances be as good as buying foreclosures. Sellers are pretty motivated to get their properties sold and are likely to be very happy to work with your agent to negotiate a sale.

And for you agents out there, a Buyer Broker contract to find expireds can open up a new channel of possibilities. So, what are you waiting on?

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