Buy Side: Buyers, not agents will suffer if commission structure changes
For Heather Maddox, working with buyers is "exciting and positive," and she’s confident she’ll continue to get paid no matter the outcome of lawsuits.
Lawsuits and speculation around the future of compensation have put buyer agency in the spotlight. In this series of stories, we hear directly from buyer's agents about what they do, their paths to success and their thoughts about how their jobs could change.
Heather Maddox has been an agent for nearly 20 years, and she understands that working with buyers is as much about expertise as it is about empathy.
During her career, she's weathered a recession and the natural ebbs and flows of the market. While lawsuits challenging the system of buyer agent pay could impact her business, she's more focused on helping her buyers in the here and now.
We talked with Maddox, a broker with Windermere Real Estate in Renton, Washington, about the buy side of her business and her strategies in a challenging market. Answers have been edited for length and clarity.
How long have you been a buyer's agent?
My business has always been 50-50. I've been a real estate agent in King County for 18 years. But buyers got me through the recession. I was a 25-year-old agent with a new license. The person who was benefiting from the recession was the first-time homebuyer, so I really leaned into that — I became a first-time homebuyer expert, and my business survived on those buyers.
What do you like most about the buy side of the business?
The educational piece of it — helping clients understand homes and the process in general. And for the most part, it's very exciting and positive. People generally buy homes when it's a good time in their life — they're getting married, they're having a baby, graduating from college, getting a new job or a promotion. There's a celebratory aspect of working with buyers that is fun.
By the time they've signed their home, it's kind of bittersweet. These are people you've seen every day for months. You really do get close to your buyers.
What makes a great buyer's agent?
Expertise and experience are great, but the ability to counsel buyers both in good times and in bad times is also important. It's almost like counseling people through dating. You see something cute or interesting, check it out, fall in love, and when you make an offer and don't get it, it's almost like a breakup.
Even the dynamic between partners and their relationship can come to the forefront. Being a good counselor is definitely important.
Also, the ability to build rapport with the listing agent is a huge factor.
How have your goals and strategies changed over time, and how much of that is driven by the state of the housing market?
It's rare that I'm the only offer on a home. Two years ago when things were going for 20% over, obviously it was a little different from right now when you might have just one other offer. So we can move at a slightly slower pace. But the ultimate goal is still to get a house.
It's still the exact same conversation — the more you're willing to risk, the stronger the offer — but buyers may not have to take as many risks as they would have a couple of years ago.
Do you think much about the commissions lawsuits?
The short answer is no.
There have been a lot of different potential industry disruptors in my career. When Redfin came in, the big buzz was that this was going to be the end of the traditional agent. I can't get too wrapped up in the "what could be."
I'm just taking care of my buyers now. If we have to change the way I get paid in the future, once that's a reality I will work with that, and I'm confident I will find a way to get paid.
How do you think things would change if buyers had to pay for their own agents upfront?
Buyers are often using every penny they have for a down payment, closing costs and reserving a little bit to be able to go over ask and compete with other buyers. They don't have extra money set aside to pay their Realtor. If that became the norm, if they had to come with 3% more, it would really hurt most first-time homebuyers who only come to the table with a down payment of maybe 3% to 5%.
So we would have a lot of buyers moving through this process blindly or with representation that may not be in their best interest. There's no way a listing agent can have both the buyer's and seller's best interest at heart. When I'm a listing agent, I won't even entertain representing the buyer because there is no way I can serve you in this big of a purchase if I'm already serving the seller.