Overview

Much has changed within the residential real estate industry over the past couple of decades. New and refined technologies in particular continue to drive change, affording buyers and sellers better access to potentially beneficial information online. (Our exclusive Naples Communities Search is a prime example.) Most recently, “artificial intelligence” is being applied across much of the real estate industry; for the better and worse. Technology is continuing to transform the real estate industry and will likely continue to do so for many years to come. This said, it is changes to longstanding residential real estate industry practices related to buyers and their real estate agents that are the hot topic of the moment.

The practices that govern real estate transactions and the licensed real estate agents involved with them have been under fire for some time now. The Department of Justice has been involved, class action lawsuits brought and settlements agreed upon. Unfortunately, much of the reporting on recent turmoil within the residential real estate industry has been misleading or wrong. There appears to be no end in site for the voracious appetite of the media to produce sensationalistic headlines aimed at driving viewership.

What has factually changed?

In this post, the most important on this site, I am not only going to clarify recent industry changes and their potential impact on buying (and selling) real estate, but discuss the role of real estate agents representing buyers in whole. In my experience as a real estate professional, buyers and sellers have not been as educated as they should be. And recent changes to industry practices arguably favoring sellers over buyers have made buying more challenging than ever. My aim is to tell you what you should know, so you can make the very best decisions for you and yours as related to your real estate transactions. Look no further and please buckle up. The most important details about working with a real estate agent to buy a Naples area home follow.

Important

Should you decide to purchase real estate in the Naples area you will have many decisions to make. The choices you will have, and those that will be required to make, can be complicated and will be highly impactful. Who you hire to represent you; how you are legally represented; the purchase agreements and addendums used; the very specific details of any offer you make; how an agreement is negotiated; what happens during any due diligence period and much, much more are of critical importance. Please be certain you understand all that follows before making any decisions whatsoever related to hiring a real estate agent and buying residential real estate in the Naples area.

Disclaimer

This post provides many facts surrounding the subject of buyer representation. It also relays my opinions and perspectives on matters related to this subject. My opinions and perspectives are my own. They are not that of my brokerage, Premiere Plus Realty, Co., or otherwise. Additionally, I am not an attorney. Nothing in this post should be considered legal advice. It is not.

Real Estate Basics

Let’s start by gaining clarity on a couple of topics that are important to understand, but commonly misunderstood.

Real Estate is Local

Real estate is literally local. The term refers “land” and “improvements.” The improvement is the building built upon the land. The business of real estate is also local. It is governed by state, county and city statutes, ordinances and otherwise. The office of your agent’s brokerage is local too. And it will have policies and procedures that need to be followed when transacting through it.

If you are a potential first-time buyer of Florida real estate it is very important to know that the business of real estate within the state may differ significantly from the state you might currently reside within. The business of real estate within Collier County, where Naples is located, is also unique as compared to other counties within the state. The various purchase agreements that are typically used to buy and sell Naples/Collier County real estate differ considerably from those used within each of the five counties that surround it.

All parties involved in real estate transactions must adhere to federal laws and nationally mandated business practices. They must also take local statutes and norms into account. It is a combination of these that ultimately determine so very much within my professional field. The Florida real estate industry is unique. It is further differentiated in Collier County. What follows in this post is specific to local area real estate.

Please note, much more Naples-specific information appears within our 2025 Naples Buyer’s Guide.

Definitions

Real estate agents call themselves advisors, experts, consultants and more. Legally, they are licensed as Brokers, Broker Associates or Sales Associates. These terms are often bandied about and are not understood fully by most buyers. To add to the confusion, these terms are often interchanged. Let’s define these from a practical perspective.

Brokerage

Brokerage refers to the business from which or for which real estate professionals work. These can be national, state, regional or local businesses. Some national examples are Coldwell Banker, ReMax and Berkshire Hathaway HomeServices. An example of a regional brokerage is the brokerage I hang my real estate license with, Premiere Plus Realty, Co. Brokerages can have many offices, each typically having a specified Broker.

Please know that Brokerage is a rarely used term within the field of real estate. Most often, the term Broker is used in place of it.

Broker

A broker is a person that is licensed to act independently in representing buyers and sellers of real estate, as well as manage others that do the same. Brokers are usually hired to run the offices of brokerages. To be a Broker means that you are currently managing other licensed agents and/or you own your own active brokerage. The licensing requirements to obtain a Broker license begin with obtaining a Sales Associate license. Once a Sales Associate in good standing for two years, a Broker license can be obtained if desired. The additional educational and testing requirements to obtain this license revolve primarily around statutes governing record keeping, property management, leasing and other aspects of real estate not specifically related to buying and selling property. Most Brokers with reputable brokerages and of adequate resources and transaction volume do not work with buyers and sellers directly. They manage the office of the brokerage only.

As noted above, while a Brokerage is the business and a Broker is an individual, the term Broker is often used in place of Brokerage.

Broker Associate

A Broker Associate is an individual that is licensed as a Broker, but is not currently acting as a Broker. They are operating as a Sales Associate. Most Broker Associates have no intention of ever opening their own brokerage or managing an office on behalf of one. They sought this designation for marketing purposes alone, believing that carrying the Broker Associate title is better for business.

Sales Associate

A Sales Associate is an individual who performs any act specified in the legal definition of Broker, but who performs such acts under the direction, control, or management of another person; a Broker. It is estimated that over 99% of real estate agents are Sales Associates. I am a Sales Associate.

What is Buyer Representation?

A Buyer’s Representative (AKA Buyer’s Agent) is hired by a potential homebuyer to assist them in navigating the financial, technical and community complexities of buying real estate.

Representing buyers is much different than listing properties on behalf of sellers. While licensed Buyer’s Agents and Seller’s Agents are both schooled in the legal aspects of representation, process, procedures, etc., once past the fundamentals there are very clear differences between these roles.

Seller’s Agents must have a firm understanding of community-specific marketplace dynamics in order to assist a seller in pricing their real estate “correctly” at the time they list it. They should know how to market real estate effectively and possess solid purchase agreement negotiation acumen from the sales side of the negotiation table. A typical seller cares about two things alone; getting their property sold and netting the most money.

In contrast, a buyer’s agent must have considerable and broad local area marketplace expertise. They need to know all locations and communities within their area of service and know them well. They must understand the numerous locations, community and property considerations a buyer must examine and the many financial aspects of buying and owning local real estate. They should know how to determine the current fair market value of a property at the time an offer is made. (Please, never rely on the estimates that national sites display. These estimates are marketing tools. They are not professional valuations.) They should be experts in negotiation from the buyer’s side of the table should a buyer hope to purchase at the best price possible. And they have to know all aspects of any contractually agreed upon due diligence period and how to guide a buyer correctly through it. A Buyer’s Agent has to have the ability to work with a buyer in a manner that they are comfortable with over time, they have confidence in and that will ultimately result with them fully realizing their real estate purchase goals. A typical buyer needs much more from their real estate agent than the typical seller. Price is almost always at the top of a buyer’s list of priorities, but there are many additional and very important considerations and decisions that must be made in order to satisfy all the interests and needs of buyers.

In Naples specifically, the most commonly used Buyer Broker agreement references the following duties of a Buyer’s Agent.

Please note that this specific list of duties covers the range of services a typical Buyer’s Agent will fulfill for the purpose of establishing a legal agreement between a potential homebuyer and agent/brokerage alone. In reality, the duties/services of a Buyer’s Agent will vary based upon the legal relationship you choose to have with them, agreed upon services and otherwise. Most importantly, a Buyer’s Agent will provide expert guidance and advice throughout the buying process. A great Buyer’s Agent is going to help a buyer locate and purchase a home that meets their interests, needs and price target as closely as is possible, while keeping them unscathed along their journey to do so.

Please know that individual real estate agents and brokerages can differ widely in their specific service offerings. Because of this, the definition of a buyer’s agent can vary. There are Limited Services agents and brokerages, as well as those that offer increased levels of service and commitment over that which a typical agent offers. Identifying the representation needs of a potential homebuyer is the first step in identifying the requirements of an agent for hire.

It is important to also recognize that each agent fulfills their agreed upon duties in their own way. And some will be considerably more competent than others in doing so. (The low bar to entry into the field of real estate is problematic in my view.) Ultimately, the role a Buyer’s Agent plays for you must be what you want and/or need it to be. You need to have trust and confidence in your agent’s abilities to assist you in the manner you have chosen via the legal relationship you have agreed to, as well as Buyer Broker agreement that has been signed.

Your Legal Brokerage Relationship

If there is one thing you take away from this post I hope it is a firm understanding of the legal relationship you choose to have with your chosen agent/brokerage. As a reminder, real estate is local. Buying real estate in Florida differs considerably from many other states. The choice you make in how you are legally represented in Florida can be to your great benefit or unfortunate detriment.

There are three types of legal relationships you can have with a brokerage/agent in Florida. Two of these are used almost exclusively. They are what is deemed a Transaction Broker relationship and a Single Agent (AKA Single Agency) relationship. Below, please find the responsibilities legally owed to you under each. (These are defined in Florida Statutes, Chapter 475.)

Transaction Broker Relationships

Transaction Broker relationships are as the name suggests; with strong emphasis on the transaction. The transaction is the priority. It is somewhat of a stretch to state that real estate agents “represent” buyers using a Transaction Broker relationship. It is more accurate to state that agents “work with” customers having the mutual goal of getting a deal done. These are de facto transaction representation relationships in my view, not buyer representation relationships. The primary interest of a Transaction Broker is putting a purchase agreement together. Real estate agents operating as such will provide guidance, but the legal duties owed to you are in limited form. Your best interests, financial or otherwise, are not the priority. There is no fiduciary responsibility owed to you.

Transaction Broker relationships are the default in Florida. This means that a licensed Florida real estate agent will act as a Transaction Broker unless/until the relationship is changed to Single Agent by signing a legal agreement making them a Single Agent. Why is this form of representation the default? In my opinion, money, power and politics.

When It Is Required

While you will always have a choice whether or not to proceed with a property purchase using a Transaction Broker or not, there are two specific instances when it is required.

When Purchasing Directly Through the Sellers’ Agent/Brokerage

While the vast majority of buyers choose to have their own real estate agent, acting as a Single Agent or Transaction Broker, some buyers choose to use the seller’s agent of the home they would like to purchase to represent them. These individuals usually believe that using the seller’s agent might get them a better price. In my experience, this is far from reality. And especially considering the August 2024 industry changes requiring clearer separation between the purchase and sale sides of real estate transactions, I believe this is less likely than ever. Should you be considering this route, please be certain you understand the full potential implications of such. Additionally, I suggest that you consider:

When Purchasing A Property That is Listed with the Same Brokerage as Your Agent

I mentioned previously that the paperwork you will be required to sign ties you to the brokerage, not the agent. We use Buyer Broker agreements, not Buyer Agent agreements. What this means is that two agents operating under the same brokerage, representing the buyer and seller respectively, must both act as Transaction Brokers. They cannot be Single Agents.

When You Might Choose It

While a Transaction Broker relationship is not the highest form of representation, there are instances when you might choose it.

If You Really Trust Your Real Estate Agent …and Single Agency is Not An Option

When Single Agency is not an option with an agent you have been working with, you really like and, most importantly you trust, you might very well become comfortable enough with a Transaction Broker relationship and keep that agent. This is not uncommon. I have helped many buyers happily purchase Naples real estate using a Transaction Broker relationship.

There are a two instances when the agent you have hired or want to hire cannot represent you as a Single Agent.

1. When the home you would like to purchase is listed with the same brokerage as the agent.

If your real estate agent is acting as a Single Agent and their brokerage has a listing that you would like to schedule a showing to see, you will have to decide whether to ask them to switch to a Transaction Broker for that showing or find a new agent from a different brokerage altogether to represent you as a Single Agent. Please note that this requirement starts with a property showing, not writing an offer. Furthermore, the required Buyer Broker agreement that needs to be in place before any showings complicates things considerably; they are typically exclusive. (There is more to come on this below.)

2. Your agent is not allowed to operate as a Single Agent by Brokerage

The liabilities that come with Single Agency are significant. The brokerage of your agent might not permit or discourage agents to have Single Agent relationships. It is also possible that they might not allow your specific agent to act as a Single Agent due to lack of experience or otherwise. (It is also important to recognize that brokerages benefit much more from Transaction Broker relationships over Single Agency.)

Should Your Agent Charge Less

The services your agent provides to you, including their costs, will be outlined on the Buyer Broker agreement you will have to sign. The cost of representation might vary depending on the level of service that has been agreed to. Some agents will charge less when acting as a Transaction Broker as opposed to a Single Agent. (The topic of agent compensation, including who pays, follows.)

You Prefer Going Direct to the Seller’s Agent

There are those buyers that believe using the seller’s agent to buy their listing is the very best course for them. Whatever the justification might be, this type of buyer is comfortable going direct and believes it will benefit them somehow. Going directly to a seller’s agent for representation is choosing to have a Transaction Broker relationship. It is choosing to have one agent/brokerage represent both sides of a potential transaction. The seller’s agent cannot represent a buyer in any form other than that of a Transaction Broker or No Brokerage Relationship. (See below.) They cannot put a buyer’s best interests, financial or otherwise, ahead of their seller’s best interests.

Why You Might Avoid It

While a real estate agent “represents you” as a Transaction Broker, this representation is in limited form. The primary focus is on putting a deal together. It does not require an agent to put your interests above all others, including the seller.

In a Transaction Broker relationship your real estate agent/brokerage:

Single Agent Relationships

There are numerous differences between Single Agency and our default Transaction Broker relationships. Transaction Broker relationships provide a limited form of representation. Single Agent relationships are the highest form of representation, requiring your agent/brokerage to represent your best interests alone and having significant liability while doing so. This liability is due to the fact that it is only as a Single Agent that an agent acts as a fiduciary.

Fiduciary Responsibility

Fiduciary duties are the highest duties known to the law. A fiduciary accepts legal responsibility for duties performed. Within the State of Florida, fiduciary responsibility can be applied between a real estate agent and either the buyer or seller, not both. One agent/brokerage has fiduciary responsibility to one client only.

Let’s briefly review the fiduciary duties owed to a buyer (or seller) under Single Agency.

Loyalty

Loyalty is one of the most important requirements owed to clients under Single Agency. Being loyal to a client requires that the agent always puts their client first. At all times, to the exclusion of all other interests and parties (including brokerages), agents must act solely in the best interest of their client and not take any actions that would conflict with this requirement.

Confidentiality

When acting as a Transaction Broker, the confidentiality an agent owes to a buyer that has hired them is in limited form. Certain information can be shared with a seller’s agent should it help get an agreement together. When acting as a Single Agent confidentiality is required in full. This can have highly significant implications when negotiating a purchase agreement.

Obedience

The duty of obedience requires an agent to follow the instructions of, and act in accordance with, the wishes of their client. (It does not include an obligation to obey unlawful instructions.)

Clients and agents are not always in agreement. While agents are required to act in the best interests of their clients under Single Agency, clients can ask agents to do things their agent believes are not in their best interests or might be considered unreasonable. When a Single Agent represents a client they must do so as the client chooses to be represented. The agent is required to take positions they believe are unfavorable to their client or unreasonable in serving them in their best interests should a client direct them to do so.

Full Disclosure

Fiduciary buyer’s agents are obligated to disclose all relevant and material information that the agent knows and that pertains to the scope of the duties owed.

Examples of the information a Single Agent is obligated to reveal to their buyer include:

You may have noticed that “any facts affecting the value of the property” is also included when acting as a Transaction Broker. The reason this specific duty is applied across each type of legal representation is that it also falls under the general requirement for your agent to treat all persons honestly and fairly. Is there any difference? Yes. The difference with Single Agency is the fiduciary responsibility to do so. Where there is crossover between duties owed to buyers under each form of broker relationship, fiduciary responsibility is the key differentiating factor under Single Agency.

Reasonable Care & Diligence

In holding a real estate license a buyer’s agent is deemed to have skill and expertise in real estate matters that are superior to those without a license. Reasonable care and diligence requires an agent to use their superior skill and knowledge in the pursuit of their buyer’s best interests. This required “standard of care” is similar to that which a doctor or lawyer has to their patient or client respectively. Simply stated, your Single Agency real estate agent is expected to know what they are doing and do it when representing you. They have a legal obligation to do so.

Accounting

An agent is obligated to account for all money or property belonging to the client that is entrusted to them. This duty compels a real estate agent to safeguard any money, deeds, or other documents entrusted to them that relate to the client’s transactions or affairs.

When It Is Required

Single Agency is never required in a real estate transaction. It is a choice.

When You Might Choose It

If you want the highest level of representation available, hiring an agent/brokerage that acts as a fiduciary, in your best interests only, is your only option.

Why You Might Avoid It

The professional services of Single Agency require heightened levels of expertise and commitment. And fiduciary responsibilities coincide with significant liabilities. Considering this, there might be increased costs to you in hiring a Single Agent as compared to a Transaction Broker for representation.

Other Broker Relationships and Need to Know

While the two broker relationships reviewed here are the primary ones used in Naples, there are two others you should be aware of. And you should know the two scenarios you might find yourself within when two individual agents are involved in a transaction.

No Brokerage Relationship

No Brokerage Relationship is the 3rd and final type of legal relationship allowed within the State of Florida. A real estate agent working with a buyer under No Brokerage Relationship does not have to apply skill, care or diligence in their duties. This form of relationship therefor carries very high risk for a buyer. This said, for the buyer that wants to hire an agent to just write an offer on a home and little more, this could be a satisfactory option.

Dual Agency

Dual Agency is when a brokerage represents both the buyer and seller while maintaining fiduciary responsibility to each.

By definition, a real estate agent/brokerage cannot act as a fiduciary for two competing parties. This is factually not possible when considering the legal duties and responsibilities of a fiduciary. Many states agree and have made Dual Agency illegal. It is illegal in Florida. I reference this here as it might exist where you currently reside. It also helps emphasize the importance of choosing the right legal relationship for you within the State of Florida.

Dual Agents

Dual Agents is not a legal brokerage relationship, but I want to make clear what this means and how this could significantly impact you as a potential homebuyer. Simply, this means that there are two individual agents involved in a transaction. One is working with or representing the seller, the other the buyer. There are two specific scenarios that are very important to understand here.

When Seller & Buyer Use the Same Brokerage

When the seller and buyer of a home use agents that are with the same brokerage each agent must act as a Transaction Broker. This stated, most would agree that there is a substantial and important difference between a buyer using the seller’s agent and a buyer using their own agent from the same brokerage. Each agent will be guided by the requirements and limitations of a Transaction Broker, but should a buyer use the seller’s agent they are not gaining the vast benefits of using their own trusted agent. They are the third party in an already established relationship between the seller and the seller’s agent. Furthermore, it is highly likely that the seller’s agent has committed themselves to the seller to get them top dollar for their home or net them the most cash.

When Seller & Buyer Use Different Brokerages

Buyers and sellers using agents from different brokerages is what occurs in the majority of real estate transactions in/around Naples. What is very important to understand in this scenario is that one agent can be operating as a Single Agent, while the other acts as a Transaction Broker. This can substantially disadvantage the party that uses a Transaction Broker. The Single Agent is acting as a fiduciary, in the best interests of their client alone. The Transaction Broker is not. They owe no loyalty to their party. They do not have to act in their financial (or otherwise) best interests. Should a buyer be using a Transaction Broker/agent and the seller Single Agency this can be problematic for the buyer. Please note, the State of Florida does not have mandatory disclosure of legal representation.

Your Agency Options in Summary

While there are three legal representation relationships you can have with an agent/brokerage within the State of Florida, you really have four options from which to choose. A choice must be made and it is your choice alone.

1. Single Agency

There is no doubt that Single Agency provides the “very best” form of representation. It is the only agent/brokerage relationship that requires your agent to act in a fiduciary capacity. If you want an agent that works for you alone. An agent that must act in your best interests only, financial and otherwise, and at all times. An agent that is legally obligated to do so. This is your only option.

2. Transaction Broker via Agent of Your Choosing

Many buyers have purchased real estate successfully using an agent/brokerage of their own choosing and acting as a Transaction Broker. Here, you have the choice of agent/brokerage. You decide who to hire and the specific agent hired represents you alone. Furthermore, the professional (and potentially personal) relationship you develop with your agent throughout your journey to locate and purchase a Naples home can make a big difference in the level of success you have. While your agent will be guided by the requirements and limitations of a Transaction Broker, it will be your trusted agent providing the guidance to you and you alone.

3. Transaction Broker via Seller’s Agent

While far from the norm, buyers have also successfully purchased real estate using the seller’s agent/brokerage of a home of interest for representation. This stated, in this scenario you did not choose the agent that is representing you. The seller did. The relationship started between the agent and the seller of the home you want to buy. Furthermore, you have one agent representing two sides of the transaction. Seller’s Agents will be guided by the requirements and limitations of a Transaction Broker, but the agent is not your trusted agent working solely for you. It will be the agent the seller chose and entrusted to get top dollar for their home. You were an add-on to an already established relationship with the seller.

4. No Brokerage Relationship

Considering that an agent is not required to use skill, care and diligence when acting under a No Brokerage Relationship, it is a high risk option that most buyers are unlikely to choose. But it is an option nonetheless. If you believe you will not benefit from representation by a licensed real estate agent, but need one to fill out the paperwork for you, No Brokerage Relationship could be an option. No Brokerage Relationship is very, very rare.

Important

The legal brokerage relationship you choose, and who specifically represents you in one of the largest financial transactions you will likely have, and life altering decisions you might make, is clearly of extreme importance. The topic of legal agent/brokerage relationships is somewhat complicated. Please be certain that you understand your options before moving forward with any real estate agent.

Please remember that Transaction Broker relationships are the default within the State of Florida. The only way you will gain the benefits of Single Agency is by signing a Single Agent agreement with your chosen agent/brokerage. Otherwise, they will be acting as a Transaction Broker.

Many agents will describe the difference between being a Single Agent or Transaction Broker in similarity to being a coach or referee respectively. A coach/Single Agent has one interest, for their team to win. The referee/Transaction Broker tries to ensure a fair game alone. While this is not an unuseful way to frame the basics of legal brokerage relationships, it is without question an overly simplistic description that minimizes the considerable benefits of Single Agency and significant risks of Transaction Broker relationships, particularly when using the seller’s agent to purchase. The stakes are much too high to describe these legal representation relationships so simplistically. The differences are substantial and can be highly impactful.

Please keep in mind that all real estate agents cannot or purposefully choose to not act as Single Agents. Why? Liability. A Single Agent acts as a fiduciary. This opens up an agent to potentially serious litigation should they not be highly capable and perform their duties in the best interests of their client. There have been enough successful lawsuits against agents and brokerages that they will not engage in a Single Agent relationship with a buyer. (Agents/brokerages also benefit from Transaction Broker relationships over Single Agency.)

If you are asked to enter into a Buyer Broker agreement in any form and the agent has not discussed the fact that you have this critical choice to make. If they have not explained the differences between the options you have. If they are not very well versed in the differences, leaving you without a sense of trust concerning this topic, you might want to rethink signing with the agent.

Buyer Broker Agreements

Most truly successful relationships, whether personal or business, rely on commitment. Each party is committed to the other to ensure the relationship is fruitful. One-sided relationships are doomed to fail. This brings us to the topic of Buyer Broker agreements.

Buyer Broker agreements are to buyers what listing agreements are to sellers. Prior to August 17, 2024 they had not been used broadly in Naples specifically, but in some areas of the country (17 states at last count) they have been used as standard practice for a many, many years. One of the two primary, mandated, nationwide real estate industry changes that went into effect August 2024 is that Buyer Broker agreements are now an absolute requirement. These agreements must be signed by buyers “working with” real estate agents. At the very latest, this must occur before a real estate agent shows property to a potential buyer, but it could be well before this. So, what exactly is a Buyer Broker agreement?

Buyer Broker agreements are legally binding contracts between potential buyers of real estate and their chosen agent/brokerage. The agreements must clearly state:

Please note, Buyer Broker agreements are required whether you are represented via Single Agency, you use a real estate agent of your choosing who is representing you alone via a Transaction Broker relationship, or you choose to be represented alongside the seller by the agent chosen by the seller; the seller’s agent. In all scenarios a Buyer Broker agreement outlining all aforementioned, including services owed and compensation due, is required.

Buyer’s Agent Services

While there is a requirement to define specifically how a buyer is legally being represented by their agent, when it comes to the services an agent offers to their potential buyer the options can be wide ranging. There are basic expectations as to what a licensed real estate agent will do, but there are also what are deemed full service and limited service agents. The services can cover every possible aspect of finding and purchasing real estate, or be very limited, tailored to very specific buyer needs alone. Individual agents decide what their specific service offerings are.

Please know that most agents resort to using a standard boilerplate Buyer Broker agreement alone. While this frames the services/responsibilities of the typical agent, it may/may not be satisfactorily detailed for you alongside what services your agent has told you they would perform. I offer a range of services in order to cater to different types of buyers. Many agents do not. It is up to you to ask for additional clarification should the paperwork presented to you for signatures not be to your satisfaction.

Buyer’s agents typically have presentations outlining their services, fees and otherwise. I would be happy to walk you through mine. If interested, please contact me.

Open Houses

Should you have no agent representation, walking into an open house on your own and conversing with the seller’s agent directly, or any other agent of the listing brokerage concerning basic property details does not require a Buyer Broker agreement. In this instance the agent/brokerage is representing the seller alone. They are trying to sell you the home.

(Please know that agents are not always running open houses. Non-licensed individuals are often hired to do so. The information these individuals can provide any visitor is highly limited.)

Direct Seller’s Agent/Brokerage Contact

Contacting the seller’s agent or any other agent of the seller’s brokerage directly, whether via phone, video, email, text or otherwise, while not being represented by an agent and seeking basic property details does not require a Buyer Broker agreement. In this instance the agent is representing the seller alone. They are trying to sell you the home.

Types of Buyer Broker Agreements

There are many types of Buyer Broker agreements. Details on two of the most commonly used follow.

Buyer Broker Exclusive Agreement

The Buyer Broker Exclusive Agreement is the most common Buyer Broker agreement used in Naples. And most agents will require it. This agreement is as stated, exclusive. The potential homebuyer legally commits to using the agent/brokerage exclusively for the term of the agreement. Should they utilize the services of another agent/brokerage they will be in breach of their contract and can be sued for monies owed.

It is important to acknowledge that unless a buyer agrees to pay an agent an upfront, non-refundable retainer or otherwise, the agent will only be paid should a purchase be made. If an agent is to provide assistance to a potential buyer, that agent needs to know that potential buyer will continue to utilize their services through a real estate closing, when payment is made. These agreements are highly similar to the exclusive listing agreements that are most frequently used when listing a home for sale. Nobody wants to work for free. Commitment is key.

Showing Agreement

The Showing Agreement is aimed at establishing a legally binding representation agreement between a buyer and an agent/brokerage that is specific to one or more listings. It establishes the services that the agent agrees to perform, compensation owed and other terms and conditions as required in any Buyer Broker agreement, as well as lists the specific properties the agreement pertains to. It is listing specific, not broad in range.

This type of Buyer Broker agreement is more common in Lee County, to the north of us, but is gaining in popularity in Naples. The agreement is most often used in the following scenarios.

Open Houses

A seller’s agent aiming to solidify a Buyer Broker agreement with an unrepresented party that has expressed interest in their listing while at an open house may very well present the option of the Showing Agreement to you. This is the “fast and easy” way to lock a potential buyer into a legal relationship. “Great! It really is a wonderful home. I’d be happy to work with you to buy it if interested. Let’s go over this Showing Agreement…” Signing this will commit you to using the Seller’s Agent for representation, under a Transaction Broker relationship, should you want to buy the home.

Other Direct Seller’s Agent Contact

Should you contact a seller’s agent/brokerage directly via phone, email, video, text or otherwise and ask to see their listing they will be very happy to show it to you. Should you express serious interest in buying the property a Buyer Broker agreement will need to be executed. But, even if serious interest is not expressed, the agent might ask you to sign a Showing Agreement. (They might also try to convince you to sign a broad range exclusive agreement.) Signing this will commit you to using the seller’s agent for representation should you want to buy the home. Again, they will have to represent you under a Transaction Broker relationship.

For the Buyer Broker Exclusive Agreement Averse

Some potential homebuyers will be reluctant to sign the Buyer Broker Exclusive Agreement early on in a relationship with an agent. For these individuals, a Showing Agreement might be a good option. It allows the potential buyer to see listings with an agent without having to sign an exclusive and wide ranging representation agreement. And it ensures the agent will be compensated should the potential buyer want to purchase any of the specific listings that they see together.

Please know that some agents will be reluctant to use a Showing Agreement over the Buyer Broker Exclusive Agreement. It usually depends on the level of service the agent has provided or is providing. It can also depend upon the service offerings/business model of the specific agent. Many agents will not work for a potential homebuyer that will not fully commit to using them via the Buyer Broker Exclusive Agreement.

Quick Showings & Otherwise

The Showing Agreement might also be used should you not have vetted agents in order to find one to work with and you want to see listings for sale. You might be visiting Naples and want to see your real estate options in the area. You may have walked into a brokerage, clicked a link on a site or otherwise to find an agent to help you. Should the agent be available to show you property and be willing to do so the Showing Agreement might be the right option.

Important

Please know that the Showing Agreement is most often used when the relationship between a potential buyer and agent is new. There has been very little or practically no real time interacting together, discussing real estate, etc. The potential buyer has not interviewed the agent for hire. And the agent has presented only the very basics needed to complete a Buyer Broker agreement, not a thorough overview of their business, services, credentials and otherwise. Still, when a potential buyer signs a Showing Agreement they are legally tied to the agent for the specific listings contained therein. Should you want to purchase any of the properties you see together, you must use the agent to do so.

Potential homebuyers should not take any Buyer Broker agreement lightly. These agreements legally tie you to an agent/brokerage. You are signing a legally binding contract for professional representation by a licensed real estate agent. And these agreements form a legal commitment by you to pay the agent. Please, know what you are getting yourself into before signing anything with anyone.

Agent Compensation

What real estate agents charge buyers and sellers, and who pays for their services, is likely the most misunderstood and inaccurately reported aspect of the real estate industry changes implemented in August 2024. Let’s clear this all up so you know what has changed and precisely how your agent might be compensated.

Who Pays for Buyer Representation?

Buyers are now legally obligated to pay their agents for their services. Whether a buyer hires a Transaction Broker or Single Agent. Whether they hire their own agent or use the seller’s agent. In every scenario a Buyer Broker agreement must be signed with the agent and the buyer must agree to pay the agent whatever they have agreed to be paid for their services. This is a result of the bifurcation of buyer and seller real estate services that is required as part of the August 2024 nationwide residential real estate industry changes.

Actual payment for a buyer’s agent services will be by the buyer, the seller, the seller’s agent/brokerage or any combination therefrom. This is no different than before the industry changes of August 2024 when using a Buyer Broker agreement. The real change is the requirement of the Buyer Broker agreement itself.

Will you have to pay for the services of your buyer’s agent? Maybe in whole. Maybe in part. Maybe not at all. Much depends on the decisions you make; the strength of the agent you hire, as well as relationship you have with them; various factors related to the seller and their agent/brokerage; and the current state of the real estate market in whole at the time you sign with an agent and then go under contract to buy.

Please note, you will always know how your agent will be paid via your purchase agreement. If the seller or seller’s brokerage is offering commission payment, in part or whole. If the seller is offering closing cost assistance to you through concessions. If you are requiring either commissions or concessions as part of your offer to purchase a home. Whatever the scenario might be, it will be made clear in the purchase agreement. You will know the position of the seller/seller’s agent/brokerage before making an offer and you will decide on the offer you want to make. Your real estate agent will guide you through the purchase agreement before you sign it. All should be made very, very clear to you. Please, never sign paperwork you do not fully understand.

Let’s break down the ways a buyer’s agent could be paid.

Seller Options

Commission Via Listing Agreement

When a seller’s agent and seller agree to list a property together a listing agreement will be signed. This agreement will outline what services the agent will provide, contains details about the listing, includes what the agent charges for representation and more. The listing agreement will include what compensation, if any, the seller or their agent/brokerage agrees to pay the buyer’s agent/brokerage upon a successful purchase. This is how listing agreements have worked for many, many years. There are no changes to listing agreements as related to offers of compensation to the agents/brokerages of buyers. Many sellers continue to agree to offer compensation in this manner. Some do not.

Concession Via Listing Agreement

A seller concession is an amount of money used to offset the closing costs of buyers. This amount can be specific or a percentage of the purchase price. It is important to know that a seller concession has no specific purpose other than to reduce the overall costs associated with buying. It cannot be stated to be explicitly for the purpose of buyer’s agent compensation. It is not a payment option. It is a concession. This stated, an agent’s compensation is considered a closing cost, so any concession offsets the cost of the buyer’s agent. A seller can agree to concessions within their listing agreement.

Commission and/or Concession Via Purchase Agreement

Should a seller not want to offer compensation for the buyer’s agent or concessions via the listing agreement, or at all, they very well might when presented this as a requirement of a purchase offer. There will be sellers that believe that waiting for a buyer’s offer is the best way to handle any potential buyer’s agent compensation or seller concession demand. In fact, many seller’s agents/brokerages will advise sellers to wait for an offer before deciding what to do. This could be better for the seller. (And it is easier to get a listing agreement signed when the stated cost of representation is lower rather than higher.) Waiting for an offer could also be much worse for a seller, especially in a buyer’s market.

Buyer Options

If you know that the seller of a property of interest is not currently offering to adequately compensate your buyer’s agent or provide a seller concession to help lower closing costs in total, you have options on how to get your agent paid.

Via Purchase Agreement/Offer

1. Agent Commission Requirement

In this instance, Buyer stipulates in the purchase offer that Seller pays the commissions owed to their agent either in part or in whole.

2. Seller Concession Requirement

Here, the buyer stipulates in the purchase offer that the seller will provide a concession to cover their closing costs, or a portion thereof. This could be a specific amount or percentage of the sales price. Buyer’s agent compensation is a closing cost.

3. A Reflective Purchase Price

Buyer reduces their purchase price offer to reflect the necessity of direct payment to their agent. Your offer would reflect the purchase price minus any “normal” discounts you might seek and the monies needed to pay your agent.

4. Adding Value

Adding value to a purchase is not payment to a buyer’s agent, but is an offset to the total potential costs a buyer has when purchasing and then using the property. One good example of adding value is asking the seller to include specific furniture/furnishings as part of a deal. If a home is listed as unfurnished, but a buyer really likes the furniture and does not have any of their own, there is value in obtaining the furniture in the home. The budget that was set aside for furniture can now be used to pay the buyer’s agent.

Via Financing

Should a buyer be financing any portion of their purchase, the lender might allow the buyer to include their agent’s compensation alongside other closing costs via a seller concession. If a buyer is ultimately responsible to pay their agent in part or whole, the buyer might increase their purchase offer to add the portion of payment they are directly responsible for and then require the seller to provide a concession in the same amount.

Please know that when financing a purchase the appraised value of the home must satisfy the lender’s requirements. If the home does not appraise adequately alongside the purchase price/loan amount, the loan will be denied. In this instance, the purchase agreement could be reworked in numerous ways in order to satisfy the lender and get approval.

Cash

If a buyer is not financing their purchase they are free to pay their agent with cash at closing.

Real Estate Agent Fees

Real estate agent fees are to real estate agents what the third rail of politics (entitlements) are to politicians. Most really do not want to talk about them unless/until they have to. I want to talk about fees. And you need to know what drives them.

Unfortunately, there is a great deal of negativity surrounding the subject of real estate agent fees. “Real estate agents make too much.” This is a phrase I have read many times, among many others, that frame real estate agent compensation as too high and unjustifiable. For some agents, in some transactions, I wholeheartedly agree. Some agents likely make too much and do not justify what they charge. Professional services businesses in whole are plagued with personnel that do not meet the mark. Many professions have low bars to entry. Many individuals do not pursue excellence in what they do.

In my view, the very best real estate agents earn what they make. How so? By being the very best in the field at assisting buyers and sellers in realizing their real estate goals. Helping a buyer locate and purchase real estate that meets their wants, needs and price point as closely as is possible. Advising a buyer concerning what is almost always a large and consequential financial decision. Guiding a buyer through a potentially life-altering decision. Keeping buyers unscathed along what can be a legally complex and often emotional journey, full with hazards. I believe these are all good reasons why the best agents earn their living.

How does a real estate agent determine specifically what they charge a buyer and/or seller? Every agent is different in this regard, but there is a backdrop for decisions made concerning compensation and otherwise. This backdrop is the state of the real estate market at the time of hire.

Market Driven Economics

The primary thing that drives real estate agent fees is the real estate market itself. The real estate market is ripe with ongoing competition between buyers, between sellers, between buyers and sellers, and between real estate agents. Real estate pricing, valuations, negotiations and agent compensation are all driven by what is transpiring within the real estate market at any given time and across competing interests. Fundamentally, the real estate market is moved by supply and demand.

Buyers Market Perspective

When in a buyers market there are more homes for sale and fewer buyers looking to buy them. Home supply is high. Buyer demand is low. Pricing is usually coming down. This puts pressure on sellers to cut better deals. This could mean better pricing and incentives to buy, including compensating the buyer’s agent and/or providing concessions. The buyer has the negotiating advantage.

Sellers Market Perspective

When in a sellers market there are fewer homes for sale and more buyers looking to buy them. Home supply is low. Buyer demand is high. Pricing is usually going up. This puts buyers at a significant disadvantage. It is harder to land a home of interest and the costs associated with doing so will likely be higher. Sellers do not have much motivation to lower prices or provide incentives. The seller has the negotiating advantage.

Financing Perspective

Mortgage rates have a clear impact on the housing market. Should rates be considered “too high” fewer buyers will buy. Whether in a Sellers or Buyers Market high rates may provide an advantage to buyers. They tend to push purchase prices down. “Lower” mortgage rates stirs more housing activity overall and might ultimately favor sellers. All said, while the Naples, FL real estate market will typically be impacted by mortgage rates, it is less so than in most other areas of the country. This is due to the fact that the majority of real estate sales here are not financed. Financing contingencies are not considered particularly favorable to buyers or sellers.

Buyer’s Agent Perspective

Whatever type of market or purchase scenario a buyer might find themselves within, a great buyer’s agent will know how to help them realize their real estate goals as closely as is possible. They will know how to handle each and every position taken by counterparties regardless of current market conditions.

What about buyer’s agent fees in any given market? Does a buyer ever have the negotiating advantage?

When considering an agent to hire, supply and demand turns from homes and buyers respectively to the availability of buyer’s agents (supply) and the need for their services (demand) by buyers. The supply of real estate agents is never an issue. There are more than enough for certain. The supply of great buyer’s agents is another matter entirely. The demand from buyers needing assistance will certainly vary over time, but better-to-best agents are typically always busy enough. All said, a buyer might have a negotiating advantage when hiring a buyer’s agent should the agent up for hire be available when needed, want to work on their behalf and the buyer is ready, willing and able to buy.

Perspectives, Meet Reality …Market Drivers Be Damned

No matter what ordinarily drives the real estate market, that of supply and demand, in reality anything and everything can and does happen when buying (and selling) real estate. You can often throw typical market drivers out the window. There are times when they just don’t matter much at all. The fact of the matter is that the market is usually somewhere in between a strong seller’s market and a strong buyer’s market. A “neutral market” is the healthiest type of real estate market. Here, neither party is particularly advantaged or disadvantaged.

Specifically as to agent fees in any given market or scenario, a reasonable agent will make reasonable adjustments if/when required to do so. Should they be made, they will be based upon a smorgasbord of factors including the current market; the legal brokerage relationship; professional relationship; agreed upon services; level of liability; expected and/or completed work level; time spent or required and more.

Additionally

Fair housing laws can influence agent compensation. If an agent offers one fee to one party and a substantially different fee to another for the same work, a fair housing law violation claim might be made.

I developed our Market Brief so interested parties could keep abreast of the latest in our local Naples real estate market. If you are interested in whether or not it is a buyer or seller market, curious about specific sales statistics and more, please be certain to check it out.

Commissions are Not Set By Law and Are Fully Negotiable

“Commissions are not set by law and are fully negotiable” is a statement of fact that is likely to appear on more than one document you will need to sign along your journey to buy real estate. Making this explicitly clear to buyers and sellers is a requirement and you will need to acknowledge your understanding of this in writing.

What exactly does this mean?

This statement means that there is no set or standard agent/brokerage commission, fee, rate or otherwise that is dictated by federal, state or local laws, real estate associations, brokerages, agents or otherwise. It does not mean that a real estate agent must negotiate their stated commission, fee, rate or otherwise to represent a buyer or seller. Real estate agents are free to offer services and have compensation requirements that are unique to them. Buyers and sellers are free to find agents that meet their interests, needs and budgets.

Important

Please know that whatever the agreed upon compensation to the buyer’s agent, the amount is capped. Unless the agreement is amended your agent can make no more than what has been agreed to via the Buyer Broker agreement. Should a seller offer a buyer’s agent commission that is greater than what you have agreed to pay your buyer’s agent, you will decide where that positive overage is applied. (If financing, the lender will help you determine this.)

Using the Seller’s Agent to Buy

One of the many closing costs a buyer now has to consider is the potential for out-of-pocket monies needed to pay for representation. As we know, a buyer might have to pay in part or whole for representation should monies not be found elsewhere. This raises one of the biggest questions that some buyers now have…. Will a buyer have a lower total transaction cost should they skirt the use of their own buyer’s agent in favor of using the seller’s agent to buy? Maybe. Maybe not.

1. To use the seller’s agent means that a buyer does not require the full services of a buyer’s agent. The buyer has no need of assistance in identifying the best location, community and home for them. The buyer knows that they want to buy a specific home. This said, when comparing use of either agent, we must compare a seller’s agent to a limited services buyer’s agent.

2. Buyers will still need to sign a Buyer Broker agreement with the seller’s agent. This will outline their services and what they charge. The seller’s agent is not likely going to represent a buyer for free. There is plenty of work that still needs to be done for the buyer. A typical seller’s agent might very well charge the same as a typical limited services buyer’s agent.

3. Payment for buyer representation, in part or whole, might already be agreed upon via the listing agreement, regardless of whether or not the seller’s agent or a buyer’s agent represents the buyer. A buyer who approaches the seller’s agent to buy a home might just as well have had the same exact buyer’s agent payment coverage as they would have had if they used their own trusted agent.

4. The seller’s agent must act as a Transaction Broker should they represent both seller and buyer. Assuming the the listing is not with the same brokerage as the buyer’s agent, they can operate as either a Transaction Broker or Single Agent. The services provided, as well as commitment to the buyer could vary considerably between agents.

5. When examining the potential differences between using a seller’s agent or a limited services buyer’s agent, both acting as a Transaction Broker, trust is a determinant factor for many buyers. Is a buyer comfortable using the agent hired to sell the home? Do they believe the seller’s agent will be fair in purchase negotiations? Should they come to an agreement with the seller, do they believe the seller’s agent will help them properly navigate the due diligence period including inspections and the potential legal right to remedy defective items? Or, are they more comfortable using an agent they hired and that only works for them?

6. The cost of representation is but one cost alone. Should a buyer be able to lower any requirement of out-of-pocket costs for representation by using a seller’s agent rather than their own buyer’s agent, should there be a requirement, at what potential total cost does this come in whole? Purchase price and closing costs matter a great deal. These are clearly two of the most important purchase factors. This said, there are many other very important items related to buying, contractual and otherwise, that buyers need to take into account should they want to best ensure their own best interests are satisfied in a purchase. Should a buyer have to pay out-of-pocket for buyer representation, in part or in whole, the best buyer representation might very well be worth the cost.

The fact of the matter is that a buyer will never really know if they saved money using a seller’s agent as opposed to their own agent. And, if they did, at what potential cost? It requires a leap of faith to use a seller’s agent to buy a home. This choice only seems sensical should a buyer truly believe that they will save considerable money, while not having any additional costs, financial or otherwise.

Please keep in mind that procuring cause could significantly undermine a buyer’s efforts to potentially save money. Should a buyer approach the seller’s agent without representation in the hopes of learning whether or not they might save money using them to buy, they are likely undermining their efforts to save should they ultimately decide that they want their own agent. A buyer might lose the commissions on offer to the buyer’s agent, incurring significantly higher direct costs for representation.

Should you be seriously considering not using your own buyer’s agent to make a purchase, hoping to potentially save money, my advise is to first explore the option of using a limited services buyer’s agent of your our own choosing for representation. Some buyer’s agents offer limited representation services akin to what a seller’s agent will offer at what are likely similar rates. Considering this, and much more, you might be much better off using your own agent, financially and otherwise, to purchase a home. One of my limited service offerings is aimed specifically at assisting buyers that would otherwise use a seller’s agent to buy. If you would like to hear more about it, please contact me.

Important

Purchase offers and contract negotiations are more complicated than ever. In addition to all other offer terms that must be decided upon and negotiated, buyers must now factor in the compensation of their agent. They need to understand not only the financial implications of decisions made, but how their decisions could influence negotiations overall. Buyers need to understand their options, the potential implications of every choice they have and the decisions that they make. This is one of the many areas a capable and trusted real estate agent comes into play. They will provide the required education, guidance and advice a buyer needs to get the home they want with the very best deal terms possible.

Hiring a Buyer’s Representative

Prior to the requirement of Buyer Broker agreements, many potential real estate buyers had a somewhat nonchalant approach to buyer’s agents and real estate showings. Unfortunately, many buyers thought the choice of an agent was somewhat inconsequential. (I can assure you that this was never the case.) However you might have felt about buyer’s agents, or agents in whole, your choice is now more consequential than ever before. The days of the willy-nilly picking of an agent for representation have effectively come to an end. You now have to commit to an agent via a legally binding agreement that potentially ties you to them exclusively for representation and obligates you to compensate them for their services. If you have read this post from the start, you now know that you need to make some very important decisions related to how you are going to go about potentially buying Naples area real estate. Finding and hiring a highly capable and trustworthy agent is of paramount importance. Should you hope to locate and buy the very best home for you – meeting your interests, needs and price point as closely as is possible – while being left unscathed along the way, the first thing you should do is hire a great agent to assist you and you alone.

How do you find a great real estate agent? You likely know that I have a strong recommendation for you, but before we might discuss this together please consider the additional information that follows. I hope it might be beneficial to you in some way.

Agent Credentials

Real estate agents are state licensed professionals. Realtors® take basic state licensing up a few notches by way of National Association of Realtors® membership requirements including extensive educational prerequisites, regular testing, strict adherence to the Realtor® Code of Ethics and more. I take things further through the obtainment and maintenance of the C2EX endorsement and being an Accredited Buyer’s Representative.

Not all agents are Realtors®. And many agents do not have endorsements, specialty accreditations or otherwise. These “tiers of distinction” allow buyers and sellers alike to recognize real estate agents that are demonstrably dedicated to their profession. They are worthwhile considerations for any buyer that would like to hire a buyer’s representative.

Agents also establish credibility and trust via the business they have done and reputations they have developed and earned. Ratings and testimonials are frequently used by agents to communicate these to prospective customers and clients alike. (Please be aware that fake “likes” and testimonials are easy to come by.) My aim is to provide exemplary service that produces exceptional results. If you would like to read what some have to say about me, please be certain to peruse my testimonials.

Industry Focus

Much of the residential real estate industry is geared toward assisting sellers, not buyers. When I took the mandatory courses in preparation for the real estate license exam years back it was made clear that, “if you list you last.” And there was some negativity concerning working with buyers. “Buyers are liars” is what many agents say to this day. Putting silly sayings aside, the fact is that most agents prefer to work with sellers over buyers. Listing properties is typically “easier.” There is also the potential for more business and a higher return on investment overall working with sellers rather than buyers. An agent can have many listings at any given time. They can only work with one buyer at any given moment. Time is money and buyers might not buy. A seller typically will sell. Because of all stated, there is a dearth of truly expert buyer’s agents.

Real estate websites are almost exclusively focused on selling property. Most sites are designed to advertise listings for sellers and their agents, not help buyers. The large national sites that do have features that are beneficial to buyers are really aimed at attracting buyers so that agents, lenders, title companies and more will then pay them for access to these visiting buyers. This is done through various marketing and advertising programs offered to all types of companies that can make money in a real estate transaction. They just need a buyer or seller contact. These are really business-to-business sites in my view. This site is different. It is business-to-consumer. Furthermore, the information contained herein will not readily be found elsewhere online, if at all. As made evident via this post, the proprietary feature set of the site and more, Naples Abodes is aimed squarely at assisting potential Naples area homebuyers, as is my business in whole.

Naples Buyer’s Agents

Everyone knows a real estate agent in Naples, FL. In fact, they probably know many real estate agents. There are over 8,500 licensed real estate agents that are members of our Naples Area Board of Realtors® alone. (There are other local real estate boards.) Considering the size of Naples, 8,500 agents is a very, very large number of agents indeed. Should you own property here you will quickly come to terms with the fact that your mailbox will see many postcards, newsletters, magazines and whatnot advertising “your local area expert,” “top producer,” etc., aiming to sell your home at top dollar for you. Finding a Naples real estate agent is very, very easy. Finding a great Naples real estate agent …not so much.

Please know that the vast majority of local agents are not very experienced or dedicated to the profession. There are large numbers of agents who are part-time, retired, unserious. In fact, at any given time over 70% of local real estate agents have done either one transaction or none at all over the past 12 months. I do not subscribe to the idea that transaction or sales volume equate to being a great agent. Some agents are very good at obtaining business and very poor at representing their buyers/sellers. Some agents do little business, but are exceptional at what they do. The stories I have to tell of agents doing the wrong thing could fill volumes. But I am also happy to report that there are some truly exceptional real estate agents in the area. All said, please understand that is it much easier to find a lackluster agent than an exemplary one.

It is strongly advised that you understand buyer representation and take your time choosing an agent to represent you. Showing up in Naples and hoping to find a great agent that has time availability to spend with you in the midst of season here is not the best option. That’s rolling the dice. Before signing a Buyer Broker agreement you need to know what you are getting yourself into and with whom. Your agent should be vetted. You need to discuss the services on offer, compensation and much more with an agent before being committed to them contractually.

Big Decisions

With all stated concerning recent residential real estate industry changes, the types of legal representation relationships between buyers and agents, required agreements between buyers and brokerages, buyer’s agent compensation and more, it comes down to this…. You have some big decisions to make.

1. Find A Great Agent …or Decide to Go Direct

You can walk into a brokerage. You can click a link on a large national real estate site. You can call the agent advertising their services in a community of interest. You can use the agent your friend used. Or, that of a friend of a friend that plays mahjong with your mother-in-law every Thursday at the clubhouse. You can contact me. You have many options as to how you find an agent and who you ultimately hire to represent you. Considering that you will be legally tied to using this agent, and might very well have to pay for their services, or a portion thereof, finding and hiring a great buyer’s agent is of paramount importance. This is arguably the most important task that you need to complete and only you can do so. I suggest doing this very early on in your exploration of the Naples area as a potential place to buy.

Please understand that should you be seriously considering not using your own buyer’s agent and “going direct” – using the seller’s agent to buy a home – you really need to make a decision either to do so or not. There are two specific reasons for this. First, should you visit an open house or contact the seller’s agent/brokerage, and then decide to use your own buyer’s agent, issues related to procuring cause, referenced earlier in this post, might prevent you from benefitting from any commission payment on offer. This could cost you substantially. Second, most Naples agents are going to require use of the Buyer Broker Exclusive Agreement. Should you sign this agreement, you will be forfeiting your choice to use a seller’s agent for the term of that agreement. You will have signed exclusively with your own agent of choice.

2. Choose Your Brokerage Relationship

I used a considerable portion of this post to explain your legal brokerage relationship options within the State of Florida. As said previously, if there is one thing you take away from this post I hope it is a firm understanding of the legal relationship you choose to have with your chosen agent/brokerage. The choice you make can be to your great benefit or unfortunate detriment. I hope I did an adequate job describing each and putting them in context for your benefit.

Please keep in mind that should you choose to hire your own agent they can represent you as a Single Agent or Transaction Broker. In either instance they will be your trusted agent will represent you alone. Should you choose to hire the seller’s agent of a home they will represent you alongside the seller and is required to do so under a Transaction Broker relationship.

3. Sign a Buyer Broker Agreement

The Buyer Broker agreement you will sign goes hand in hand with hiring an agent. Many agents will require exclusive agreements. Before signing an agreement in any form you need to understand:

In Closing

I am privy to the buying experiences that customers have had with me directly and many of their experiences in previous real estate dealings that they have shared with me. I also have firsthand knowledge of certain aspects of the counterparty experience in many transactions I have been involved with. And I know about many more real estate deals directly from local agents, as well as the brokerages I have hung my real estate license with over the years. What has become abundantly clear is that the experiences that customers have working with real estate agents, and the transaction outcomes realized in large part through their work, run the gamut from extremely positive to downright awful.

A real estate agent is a professional services provider. As such, in order to ensure customers have the very best experience buying real estate, the services that their agent provides must be understood and agreed to. Herein lies one of the many issues that used to plague the real estate industry. The role of the buyer’s agent was unclear, misunderstood and/or there was no formal agreement between buyer and agent. Making matters worse, many believed their choice of agent would be inconsequential. Bad experiences and outcomes were inevitable. But that was then and this is now. As of August 17, 2024, we are living in a new residential real estate world.

The industry changes covered in depth throughout this post are in some regard very positive for buyers and the agents hired to represent them. If nothing more, we now have clarity and commitment. A conversation between a potential homebuyer and buyer’s agent must be had concerning the services on offer. An agreement must be made as to what the agent will do on behalf of the buyer in support of their goals. Buyers must sign Buyer Broker agreements, committing themselves to use the agent that has provided assistance. Buyers know what their agent will do. Buyer’s agents know they have a committed buyer. These are positive developments and are welcomed. This said, with the good comes the bad.

Buying real estate is more complicated than ever. There are many turns that require careful navigation. Buyers need to understand their options and the potential consequences of every decision made. And, let’s not leave out the elephant in the room…. Buyers may very well have to pay, in part or whole, for buyer representation. Should a seller not agree to cover your agent’s fees, in part or whole, you will be on the hook to pay what you have contractually agreed to pay. This is an unfortunate reality for all buyers, nationwide. It is a reality that all buyers must come to terms with. What was a good system to ensure professional buyer representation and agent compensation has been turned on it’s head. It is what it is.

I have attempted to provide you with all the basics of what you need to know about the current state of buyer representation. I hope I have done so in a manner that is beneficial to you. While I have provided quite a bit of information here, please know that there is much, much more to know about buying real estate. One thing you should know at this stage is that so very much depends on you. It is you, the prospective buyer that calls the shots. How you are legally represented is something you need to decide. And whether or not you hire your own agent to represent you alone or not is up to you. You have more responsibilities than ever to see to it that your real estate dreams are realized. That you are protecting your own very best interests. All said, a great real estate agent will provide the advice and guidance required to best ensure your utmost success.

Next Steps

Should you maintain interest in purchasing Naples area real estate and you are in need of a local real estate agent for assistance, let’s talk. I am certain you might have some questions. I have the answers. And it is never too early in the buying process to begin examining your options. In fact, the earlier the conversation starts usually the better. Helping buyers is what I do. Please contact me at any time.