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What's a Buyer Representation Agreement?


In the past a handshake was all we needed to establish a relationship but in today's world, that doesn't always work. As realtors, we meet potential buyers at open houses and through referrals from friends, family and clients. We establish their needs and take them on home and neighborhood tours to help them find their dream home. When inventory is plentiful, an agent might show a potential buyer 8 properties in a day and over the course of the search 30+. A good realtor will spend time researching potential properties to understand the history of the home, pricing and information that might affect the sale. When we hear that our buyer has purchased a home with another realtor, it can be very frustrating. Of course, buyers have a right to choose their agent and sometimes, the chemistry isn't there but establishing an agreement ahead of time, can prevent misunderstandings.


An updated Buyer Representation Agreement has just been published and its use is being encouraged by brokers across the state. Just as a contractor, an attorney, a closet designer require an upfront commitment, the buyer's agent is asking for the same.


The form establishes a mutual agreement to work for and with one another. Here are a few highlights:

  • Any compensation offered by the seller’s broker is credited against the buyer’s obligation to pay so the buyer may not have to pay anything at all for the broker’s services. For example, if the seller's broker agreed to pay 3% to the buyer's agent, the buyer would owe no commission. If the seller's broker only agreed to pay 2%, the buyer would pay 1% if a 3% commission was established in the Buyer Representation Agreement. (In today's market, sellers generally pay buyer/seller commission but things may change)

  • During the negotiation phase, a buyer may ask the seller to pay their commission obligation as part of the sale if applicable. Everything is negotiable.

  • The term of the agreement may be as long or as short as both parties agree. With limited inventory, a search may take longer so it will depend on the market, the location and the needs of the buyer.

  • The scope of the agreement can be broad or very specific. It can identify a type of home, a neighborhood, price range or it may keep the search open.

  • Buyer representation agreements can be modified by mutual agreement at anytime.

Real Estate has a lot of moving parts but I think we can all agree that having clarity and establishing a commitment is a win/win for all parties.

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Sotheby's International Realty
3775 Via Nona Marie Suite 100, Carmel CA 93923
831-624-9700

License: DRE#01966114

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Debora Sanders is a real estate salesperson licensed by the state of California affiliated with Sotheby's International Realty. Sotheby's International Realty is a real estate broker licensed by the state of California and abides by equal housing opportunity laws. All material presented herein is intended for informational purposes only. Information is compiled from sources deemed reliable but is subject to errors, omissions, changes in price, condition, sale, or withdrawal without notice. No statement is made as to the accuracy of any description. All measurements and square footages are approximate. This is not intended to solicit property already listed. Nothing herein shall be construed as legal, accounting, or other professional advice outside the realm of real estate brokerage.

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