Author: Jim Duncan

Last year’s revision of the Virginia Agency Law brought some clear changes to the practice of single agent dual agency (one agent “representing” both parties in a transaction). What it also brought is some confusion about the actual home buying process and when buyer broker agreements need to be signed – and by whom.

Here is an example of a common question raised by agents and buyers –

Question: “A coworker here was told by an agent in (somewhere in Virginia) that it was a law that he had to sign a buyer broker before seeing or obtaining any info about a house. um, BS, right??”

Answer: Yes. Really; in order to see a property with a real estate agent, the agent legally needs a written agreement with you, even if for only a day, or a single house. Many agreements are for longer periods – six months is a common term. The option of an Unrepresented Buyers Agreement exists, but that’s a story for another day.

From the Virginia Association of Realtors’ page for consumers:

The short answer is that Virginia law requires (the Disclosure of Agency and the Agreement) in order to protect you (the consumer). The longer answer is that having something in writing — whether it covers a single property or a months-long relationship — ensures that both you and your Realtor® understand exactly what’s expected from each other.

What does this mean in practice for a home buyer?

Here’s an example.

– You find a house for sale that you want to see. You call the listing agent (they’re not representing you/cannot represent you; their goal is to sell the house, not help you). That agent should give you something in writing stating that they are not there for you, and they may try to sell you on the merits of single agent dual agency (if this happens, my advice: be wary)

– You find a house for sale that you want to see. You know you need and want representation so you contact the realtor your friend used last year; you know you’re not quite ready to sign on with them – it’s a first date. Your prospective agent should still give you something in writing that you sign acknowledging this. This date might lead to a long-term relationship, but for now, sign a one-time, über-short-term brokerage relationship.

What does this mean?

Is this process overly cumbersome? Yep. (blame the lawyers and the legislature)

Do you have to sign something? Yes.

Choosing a buyer’s agent to represent you in the real estate market is the single largest purchase you’ll ever make.

It sounds simple enough finding a Realtor to help you choose the place where you’re going to live for the next five, seven, 30 years. The first real estate agent you meet might seem friendly enough, but don’t rush. Ask yourself if they will be a good fit to work with you?

Selecting a Realtor can be daunting (and should be one of the very first things you do if you’re contemplating buying a home.)

To start with, you might not know the questions to ask or you might not know how to compare agents. Additionally, you can’t always approach the research process as you would with other purchases or decisions. There really aren’t any review sites out there that are consistently credible (one GenY buyer recently said they don’t read agent reviews. They don’t trust them).

Most everyone can tell if a camera takes a good or a bad picture — people take pictures every day– but most people don’t hire Realtors but every five to seven years … and a lot changes in that time frame.

As the fall and spring real estate markets approach, here are a few relatively straightforward questions to help you down the path.

1 – Will you truly represent me?

What is your prospective Realtor’s policy on single agent/dual agency? (hint: in my opinion, a situation in which one agent “represents” both sides of a transaction benefits one person – The Realtor ).

Will they advise you to walk away if that’s the best route for you? (tip: Most Realtors get paid on commission when a house closes, so this is advice counter to their immediate own best interests.)

You don’t know if they don’t know how to fill out a contract. You don’t know that they have a full-time job and they do real estate on the side. You might not know that they’ve represented three buyers in the past 18 months … and have never done a short sale, foreclosure. You don’t know if they have a great reputation in the real estate community. So … ask. (I told someone the other day that I see every interaction as a potential job interview).

2 – What are your hours?

I tend to tell my clients that I work when they need me to – which is frequently after hours, meaning that I show houses or meet weekends (much to my family’s chagrin, that often means 9pm skypes …). Make sure your agent’s schedule meshes with yours. I met some clients recently at 9pm at their house … after they had a chance to settle down.

3 – How do you communicate?

I learned some time ago that my preferred method of communication may not be my clients’ – and not to make assumptions about how my clients communicate. So I tend to ask. Do you text? Email? Skype? Google hangout? What works best for the client?

4 – Are you productive? Do you know the market?

Not so productive that they can’t call or email you back, mind you, but productive enough that they know what’s happening in the market. Today’s real estate market is different than the market six months ago. If your agent is doing this part-time at best, be prepared.

5 – Are you family?

Hiring a family member to represent you may not be the best idea in the world. Ask yourself this: could you fire them if need be?

A few more questions to consider that don’t have objective answers, but are crucial to ensuring a great experience..

6 – Do I like you?

This matters. You’re potentially going to be spending hours upon hours with this person; much of it in their car. There has to be some sort of chemistry there. I’m often with buyer clients for four to six hours at a time – driving around all points of Charlottesville and Albemarle. You don’t want this time to be painful. You need to be as relaxed and at ease as possible sot that you can focus on identifying where you want to live.

These are some questions to help you get started … ask for a buyer consultation meeting in which you and your prospective agent can mutually assess if you will be a good fit for each other. Knowing that your goals are mutually aligned is an important first step.

Above all, treat this seriously, as if you’re hiring someone to help you make good decisions about how you’re going to spend hundreds of thousands of dollars (because you are).

1. You’ll lose weight: The average resident of a walkable neighborhood weighs 6 to 10 pounds less than someone who lives in a car-dependent neighborhood .

2. You’ll save money: Transportation is the second largest expense for American households, costing more than food, clothing, and health care.

3. You’ll connect with people: Studies show that for every 10 minutes a person spends in a daily car commute, time spent in community activities falls by 10 percent.

Sounds like an infomercial, right?

Actually, it’s an info graphic created by the California Association of Realtors on the benefits of walkability. Walkability has become an increasingly hot topic in the real estate space – driven largely by buyer demand, which itself has been driven by renewed focus on health, connectivity, and the desire to save money and time through shorter commutes.

One of the main questions I ask when working with clients is, “What does walking distance mean to you?” The answer varies, but typically the answer is “under a mile.” So – Belmont is walking distance to Downtown. Parts of Rugby are on the cusp (but are certainly bikeable).

Looking at walking and biking to stuff purely from an economic perspective:

Walkscore’s new Bikescore offers up some strong reasons to cycle: “$10 saved for each 10 mile commute. One pound CO2 saved for every mile pedaled. 30 minutes per day of riding cuts odds of stroke and heart disease by 50%.” (Walkscore, 2012)

Forbes’ Pedaling to Prosperity lays out the ways that biking saves U.S. riders billions a year. Average annual operating cost of a bicycle: $308. Average annual operating cost of a car: $8,220. Between 2000 and 2010, the number of bicycle commuters grew 40% in the U.S. The average American household spends more on transportation (16%) than on food or healthcare. Low-income families may spend up to 55% of income on transportation when they live in auto-centric environments. (Forbes, 2012)

I have clients who are trying to buy a house closer to work because they want to save money on gas and spend more time together as a family. Currently they are renting close to their respective jobs; the guy recently changed jobs and now walks the approximate 2 miles to work – saving $200/month! That’s money better spent on housing, food, kids, dogs – life.

There are various groups in the Charlottesville area advocating for more and better pedestrian/bicyclist accessibility, including the newly formed Walk Charlottesville, ACCT, and others, yet the impetus must come from the consumers forcing themselves into the conversations, both market and policy. Accessibility has absolutely improved over the past few years … when the Meadowcreek Parkway and Hillsdale Connector  become realities, the biking and walking commuter experience will be further enhanced and enabled.

Walkability/bikeability matters. Personally, I can’t quantify exactly how much this matters, but I know that it positively affects my life: In my neighborhood, I can walk or ride a bike to the grocery store, coffee shops, restaurants, hardware store, ice cream, schools … frequently with my family.

The bottom line: Less gas + more family time = happiness. And more money in my pocket.

Jim Duncan is a real estate agent in Central Virginia, and since 2005 has authored the longest running Charlottesville real estate blog, RealCentralVA. A partner and founder at Nest Realty, the local media consistently turns to him for real estate expertise and market analysis.