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If you’re new to the home-buying process or haven’t bought a home here in Washington State, you may be wondering what a buyer-agency agreement is and whether it matters. A newer requirement, this contract actually does matter for buyers. Read on to find out why buyers must sign a Buyer-Agency Agreement, what it’s designed to do, and why it’s an important piece of the real estate puzzle.
Buyer-Agency Agreement: What It Is
When you find a real estate agent that you want to work with, you’ll sign a Buyer-Agency Agreement. It may also be referred to as a buyer representation agreement or a buyer-broker agreement. This written contract is between a prospective home buyer and a real estate agent. It outlines the services your agent will provide, their compensation structure, and the terms under which they will provide their services.
Curious about this agreement’s background? Well, in mid-2024, the National Association of REALTORS® (NAR) began requiring agents to have clients sign a Buyer-Agency Agreement before showing homes to clients. This change resulted from a nationwide settlement. It provides greater transparency and accountability since all agent-buyer relationships are clearly defined in the contract. This requirement is not new in some real estate markets, and isn’t here in Washington state. But if this is new to you as a buyer, you’re not alone. It’s important to make a well-informed decision.
Is a Buyer-Broker Agreement Good for Buyers?
A buyer-broker agreement (AKA a Buyer-Agency Agreement) helps build trust, establish and manage expectations, and create a clear timeline. You’ll definitely want to read any real estate agreement in full before signing it, and consult a lawyer for any legal advice you may need.
More specifically, an exclusive buyer agency agreement means you must work only with that real estate agent in that area during the term stated in your contract. By signing this agreement, you’ll have clarity around compensation. Also, you’ll know exactly what your agent will do for you. This includes helping you navigate listings, set up showings, compare neighborhoods, provide you with market research, and guide you through offers, inspections, and the closing process.
Common Concerns & How to Address Them
If you haven’t signed this type of agreement before, you may be concerned about a loss of flexibility. Sometimes we hear people ask, “What if I want to work with another agent? Will I be stuck with the wrong agent?” Not to fear. As a buyer, you can negotiate the term length, scope, and cancellation language to feel more comfortable. As the National Association of Realtors (NAR) states, “Compensation between you and your real estate professional is negotiable and not set by law. In the written agreement, the compensation must be clearly defined (e.g., $0, X flat fee, X percent, X hourly rate)—and not open-ended or a range. Only sign an agreement that reflects what you have agreed to with your real estate professional.”
Another concern some buyers have is about the timing of signing this agreement. If you’re serious about buying a home in Washington State, or more specifically, here on Bainbridge Island, it’s best to sign within a defined time frame to ensure committed representation. If you’re casually browsing or unsure about an agent, consider an initial consultation or a very short-term agreement first.
If you have any additional questions, please feel free to reach out to one of our experienced real estate agents here at Windermere Bainbridge. If you’re eager to start looking at homes for sale on the island, check out our article on what to do before browsing listings on Bainbridge Island, and read this piece that debunks real estate myths.
Happy house hunting!
