Buying a home can be a complicated and confusing process, even for seasoned home buyers. That’s why 8 out of 10 buyers work with a professional real estate agent at some point during their home purchase process, according to the Zillow Group Consumer Housing Trends Report 2019. Here’s how to hire a buyer’s agent — and why it’s a good idea.

What is a buyer’s real estate agent?

A buyer’s agent is a licensed, professional real estate agent working on behalf of a home buyer. They officially represent the buyer in all aspects of their home purchase.

Most real estate agents represent both buyers and sellers as part of their business. In fact, 78% of agents reported representing both buyers and sellers in the past three months, according to the Zillow Group Report. However some real estate agents or brokers only represent buyers, either because it’s their personal preference or because their brokerage doesn’t accept listings.

How does a real estate agent for buyers differ from a real estate agent for sellers?

A buyer’s agent represents the home buyer in a transaction, while a listing agent represents the seller. Both buyer and listing agents are licensed professionals who have legal and ethical obligation to represent their client’s best interest.

Can one real estate agent represent both the buyer and seller?

When the same agent represents both the buyer and the seller in the same transaction, it’s called “dual agency.” Dual agency is illegal in some states. And, in states where dual agency is allowed, many agents don’t believe it’s possible to represent both parties’ interests fully and frown upon the practice. When hiring a real estate agent, it’s best to go with an agent who will solely work for your benefit.

Why hire a buyer’s real estate agent?

Buyer’s agents help you navigate the whole home-buying process, from your initial search through closing. According to the Zillow Group Report, 85% of buyers use a real estate agent or broker. Here are the key benefits to using a buyer’s agent:

Immediate access to listings: Buyer’s agents have a strong grasp on the inventory in your area and may have access to more listings than you see online. Agents will have access to listing the minute they hit the market.

Skilled negotiations: Your agent will help you determine a fair market value for a home before you make an offer and give their expert input on a strategic offer based on market conditions. Then, they’ll negotiate with the seller’s agent on your behalf, helping you come to an agreement on price and terms.

Experience: An experienced agent can be invaluable in all phases of the process, whether it’s knowing when to expect a counteroffer or red flags in an inspection report. They are a trusted advisor who can give you honest guidance that could save you time, money and stress.

Recommendations: An experienced agent can recommend lenders, real estate attorneys, escrow officers and home inspectors they trust. If your agent and these professionals have a strong working relationship, they can often work together to streamline processes and keep the transaction moving forward.

Paperwork management: From offer paperwork to contingencies to closing documents, buying a home requires a lot of paperwork. Your agent will gather documents, explain your rights and obligations under the contract terms, ensure nothing is missing, and walk you through everything that needs to be signed.

How much does hiring a buyer’s real estate agent cost?

Agents report that the total commissions received from a transaction is 6% of the home’s purchase price on average, based on the Zillow Group Report, with that amount split between the buyer’s agent and seller’s agent.

When sellers list their home with an agent, they negotiate and agree to a commission amount. The buyer’s agent is paid a portion of the total commission, based on the terms of the listing agreement. However, according to the Zillow Group Report, 26% of agents reported that buyers paid their own agent’s commission fees.

In the majority of home transactions, it is the seller’s responsibility to pay the buyer’s agent commission out of the net proceeds of the sale.

Here’s an example: On the sale of a $245,000 home, the seller’s agent would receive a $14,700 (6%) commission and then pay half to the buyer’s agent — $7,350 (3%) — at no cost to the buyer.

Buyers may be responsible for paying their agent’s commission when the seller is unwilling to pay the amount you’ve agreed to pay your agent in your buyers agency agreement. For instance, a for-sale-by-owner (FSBO) seller may choose not to offer any commission. Or, you may have an agreement that commits you to paying more than the offer of compensation from the seller. Be sure to check your buyer’s agency agreement to see what you would be responsible for paying in this kind of situation. In some circumstances, negotiations or market conditions can lead to buyers paying their agent’s commission as a way to increase their offer strength.

How to find and hire a buyer’s agent

Like with any professional you hire, you want to find an agent who is a good fit for your needs, communication styles and goals. Follow these steps to find a great agent.

1. Search the agent directory

You can easily start your search on Zillow’s agent directory, where you’ll see a list of agents serving your area. The tool also has bios, reviews, ratings and a list of past sales they’ve facilitated. It’s a great way to get a feel for an agent’s reputation.

2. Ask friends and family

Your social circle is another good way to find an agent you can trust. If you have friends, family members or colleagues who have bought a home recently, ask for a recommendation. You can always cross-check those agents’ names with online reviews to get a more comprehensive sense of an agent’s experience.

3. Interview at least three agents

Have a conversation with at least three different buyer’s agents to better understand what it would be like to work together. Here are some important questions to ask:

• How many buyers in this area have you represented in the past three years?
• Do you work full time in real estate?
• How quickly do you respond to client requests? What are your working hours?
• Do you have any buyer’s agent credentials, such as Accredited Buyer Representative (ABR) or Certified Buyer Representative (CBR)?

4. Sign an agreement

Once you’ve found the right agent, they will likely have you sign an agreement that outlines how you’ll work together and how they’ll be compensated. There are two common kinds of buyer’s agent agreements:

Exclusive buyer’s agent agreement: This type of contract means you’re agreeing to work only with that agent for a certain period of time, usually 6-12 months. Typically, the agent will be owed a commission for any home you purchase during that time. If the seller of the home you buy does not offer a commission (which is more common with FSBO sales), you might be responsible for paying your agent’s commission, so read your contract carefully.

Non-exclusive buyer’s agent agreement: A little more forgiving, this agreement means you’re working with your agent, but you are also welcome to work with another agent as long as you let the first agent know. The agent who eventually shows you the house you purchase is the agent entitled to commission.

What to look for in a buyer’s agent

Depending on how your home-buying process goes, you could be spending multiple months working with your agent, so be sure to partner with someone with a complementary communication style and work ethic. In addition to a good personality match, here are some key attributes you should look for in a real estate agent.

Hyperlocal expertise

Every real estate market is different. Home prices, demand and housing types can vary by state, city and even neighborhood. Look for an agent who is experienced in the specific area where you’re interested in buying. You can look up their past sales on Zillow and map the addresses, or simply ask how much business they’ve done in the neighborhood recently.

Strong communication skills

Your agent should be a skilled communicator both with you and with other key parties involved in a real estate transaction. They should be able to successfully communicate your offer and negotiate contingencies with the seller’s agent. They should also be adept at working with your lender, home inspector and attorney/escrow officer. Ask them how quickly they reply to client requests or questions and what their “off hours” are. Most good real estate agents are available evenings and weekends in order to help keep your purchase moving forward.

Years in business and reputation

Becoming a real estate agent is a popular career choice, but it also has one of the highest failure rates, as people don’t realize how much work it is. Usually, an agent who has been in the industry for at least three years has a good handle on the process and a number of closings under their belts. If you choose to go with a newer agent, make sure they have completed closings already, and that they’re being guided by a more experienced agent.