Moving to LI

Can someone explain to me how buying in NY works? In my current state, both seller and buyer must have their own realtors, no lawyers necessary. From what I understand about NY is that one realtor represents both buyer and seller. Is that true? If so isn't that somewhat advantageous for the realtor to keep the sell price high and look out for themselves? Any clarity around this is appreciated.

Moving to LI

New York is unlike anywhere else in the country :) I'll list a few differences below. I'm both a lawyer and a real estate agent, so if you need help in your search, let me know!

In many states the real estate agents draw up the contracts. In New York, the lawyers draw up the contracts. Lawyers fees range from $700 to $1500 and each party pays for their own attorney.

In many states, when you make an offer and that offer is accepted, the home is under contract and is no longer shown. In New York, the home is not under contract until the contracts are negotiated by an attorney and signed by both the buyer and seller, with the buyer signing first. The seller can show the house and accept offers until the contract is signed. This means that even if you have an accepted offer, the seller can still take a better offer and go back on your agreement.

In many states, when you agree on a price and get a contract you put some amount of earnest money down, but it's often a small amount ($500, $1,000). In New York, sellers want significantly more than that at contract signing. It's a point of negotiation, but some sellers want the whole down payment, some sellers will settle for 5% or 3.%%, while others want at least $10,000.

In New York, a real estate agent can wear one of three hats. They can be the listing agent. This is the agent whose name you see on the sign. They can be the selling agent. This is the agent who brings the buyers to the home. It may or may not be the same agent or company that has the name on the sign. They are required to work in the best interest of the seller. This is true even if they have worked with you for weeks or months. They cannot tell you things that would be disadvantageous to the seller and if you tell them something that would benefit the seller (Such as "I'm going to offer $300,000 for the house but I can really afford up to $500,000) they have to pass that on to the seller. The only duty they owe you is a duty of truthfulness and fair dealing.

In the third role, the agent can be the buyers agent. In this scenario, they work for you, can and should provide you comps, and do increased due diligence about the property to make sure everything is in order. When you work with an agent in most other states, this is often the relationship you have with your agent.

So how do you know what you are getting? When you sit down with an agent, there is a disclosure that you must sign. On that disclosure it will state what your relationship is with that particular agent and who that agent is working for.

Does that clear anything up or just make it more confusing? If you have any other questions, I'd be happy to help!

Moving to LI

Thanks, that's definitely helpful. Should I have more questions I'll reach out!

Re: Moving to LI

Lori gave a great explanation of the various ways you can work with a real estate agent.


I just wanted to add that I highly recommend working with your own real estate agent and having that agent be a buyer's agent. There are so many benefits to having your own buyer's agent, especially when you are coming from out of the area and aren't as familiar with the market. You really want someone to look out for your interests - you are the one bringing the money to the table after all!

A buyer's agent can strategize with you on your offer, advise you on current market value of homes you are considering (and share sales data of comparable homes with you), point out potential negatives about homes you are considering, show you homes that are not listed on MLS (such as expired listings, homes that are being sold by owner, exclusive listings of other real estate companies), and help you with your due diligence (because in NY, the burden is pretty much on the buyer to verify all info about any house). They can also be your advocate throughout the process rather than just a liaison or middleman "brokering" the transaction.

I used a buyer's agent to buy my home when I moved from the city to Long Island a few years ago. This was before I was in real estate -- even though my husband and I were both from LI, and were relatively savvy about the process (I am an attorney and he's in banking), we found it SO useful to have a buyer's agents. And most of the buyers I work with prefer to have a buyer's agent, too. It used to be relatively rare on Long Island, but buyer's agency is now becoming the norm (like it is everywhere else in the U.S.!). It just makes sense - it's a much more intuitive way for an agent and buyer to work together.

Good luck!