January 22, 2010 Real Estate Market Report
I. Market Report - All Residential.
Week-to-Week Under Contract. For the week ending January 22, 2010, 39 residential listings were placed under contract by Columbia area agents. Of these, 30 have Columbia mailing addresses. This compares to 29/22 respectively for the prior week, which is an increase of 26% overall.
II. Does Agency Really Make a Difference?
First, let's review what agency is. The instructor of a tax course I am taking said it very succinctly: Agency means you are under the protection of another. That "other" is your agent. In real estate, agency is not established by who pays the fee; it is established by a written agreement. The agreement states who the agent represents, what he or she is allowed to disclose about the client, what happens in various circumstances and who pays the fee. Often the agent is paid by one party, but represents the other.
That is all fairly clear. If you elect to buy a house from the listing agent, you have no agent--no protection, no representation, no advocacy on your behalf. It's like going to court using the other party's attorney. That's because the agent owes allegiance to his or her client--the Seller. What is often not clearly explained is what happens if your agent works for the same company as the Seller's agent. The answer lies in what type of agency is practiced by your agent's company.
This is the least understood part of agency today, and it could affect the price you pay and the outcome of your transaction. I am going to compare "Limited Agency Representing the Buyer" with "Designated Agency Representing the Buyer." If your agent works for a company utilizing Designated Agency and you choose a home listed by a different agent in the same company, you are afforded the same protection, representation, and advocacy that you would have if you had chosen a home listed by another company. Century 21 Advantage practices Designated Agency.
On the other hand, if the agent works for a company practicing Limited Agency and you choose a home listed by a different agent in the same company, your agent becomes a Dual Agent and you lose the protection, representation and advocacy that your agreement afforded you. That's because every agent in the company is deemed to represent every property listed with the company. Re/MAX Boone Realty practices Limited Agency. Since they have a large number of listings, there is a significant chance that you will choose one of theirs and that their agent will become a Dual Agent. Re/MAX is a fine company and I have worked for them in the past. We sell a lot of their listings. You just need to know the implications of Limited Agency on you the Buyer, from the outset. It really could make a difference.
III. OOPS!
I learned three things last week: 1) Mitsubishi Motor Co. has a great warranty, 2) Never use water on your car's engine, and 3) if you are flying out of the country, be sure that the passport you grab is your own and not your wife's. Needless to say, I didn't make it to Guatemala, but no use crying over spilt milk. At least we are not suffering the results of a natural catastrophe like the one in Haiti.
