In 2024 it became necessary for a real estate agent to get a written agreement with a potential buyer before they could tour a home with them. Claims had been made that sellers were forced to pay a commission to the buyers’ agent and that buyers should pay for their own agent. In Silicon Valley the default was that sellers pay all commissions but the sellers have had the choice how much to pay or even if they pay. Most sellers understood that a real estate agent is trying to earn money and is going to avoid working for no pay and accepted the default arrangement.
A benefit of the seller paying all commissions is that the buyer does not have to use his cash to pay a commission which would reduce how much he has for a downpayment. Having a larger downpayment enables the buyer to qualify for a larger loan and thus be able to purchase a more expensive home.
Home buyers are accustomed to not making any commitment until they are ready to make a purchase offer. Real estate agents representing buyers now have to overcome the buyers’ expectations. This could lead to lower commissions. It is likely that experienced agents who typically represent sellers will gain an even more advantageous position over buyer agents due to the reluctance of buyers to sign an agreement.
The written agreement between the buyer and their agent must specify the agent’s compensation (commission) and the length of the agreement. It should also describe the services the agent provides. Typical services would be finding properties, showing properties, analyzing property values, and preparing and submitting purchase offers.
Many home buyers believe they can find the home and don’t need any assistance doing that. The median days on the market, DOM, for Silicon Valley homes for sale is about 10 days. For Millbrae homes the median DOM varies significantly but is about 13 days. Even with the available automated alerts, it could be challenging for a home buyer to respond in time for a newly offered home.
Although detailed up to date plots of Silicon Valley real estate trends are publicly available, the understanding gained from the daily professional involvement of a real estate agent is only available by working with an active agent.
Many of the trend plots publicly available are simply republished plots created by the Multiple Listing Service. A handful of Silicon Valley real estate agents create more informative plots of Silicon Valley and Millbrae real estate trends.
