Do I Need a Real Estate Agent to Buy a Home?

You bet. Navigating a real estate purchase is tricky business. The web has made it possible to do a lot of the legwork yourself, but there’s no substitute for an experienced professional. A crack negotiator who knows the market can save you time, money and heartache by helping you make the right offer—playing hardball when necessary—and staying on top of the process.

But don’t just call the agent on a listing you like and sign up. That agent is working for the seller, who (naturally) is trying to get you to pay top dollar for their home. You need a "buyer’s agent," who represents you exclusively. In return for that exclusivity, you’ll likely have to sign a contract saying that you won’t work with any other broker for a specified period of time.

You may encounter what’s called "dual agency," in which the agents representing both sides of the transaction work for the same brokerage; it could even be the same person. In most states such an arrangement isn’t illegal, but it raises the potential for conflicts of interest or leaks of confidential information. “The key is transparency,” says Ryan Fitzpatrick, director of sales for New York real estate agency CORE. Agents must disclose the situation in writing to both buyer and seller and get written approval.

Understand that you’ll pay one way or another. Yes, the agent’s commission (typically 5%-8% of the purchase price) comes out of the seller’s sale proceeds, but the home is priced to account for the agent’s cut. Depending on the situation, an agent may be willing to knock a percentage point off the fee to speed a sale.