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Real Estate is Local!

I just got a call from someone looking for the agent representing a property that is in escrow. They have been unsuccessful in finding who it is and asked if I could help. With some investigation, I found the agent is from out of the area (Northern California). Out-of-area agents do sell properties in SLO County. Having a California real estate license allows a Broker to handle property transactions anywhere in the state. But while this is possible to do, is it the best choice to have an out-of-area agent represent them?

While brokers (and agents) can sell anywhere in California, this doesn’t mean that they have access to property information that they would in the community where they live. To gain access to the Realtor Multiple Listing Service (MLS) in an area, the Broker (and then agents) need to join the local MLS Association which costs $$$.  Most out of area agents only sell a property on the Central Coast when they have an opportunity (like when someone they know in Bakersfield is looking to move here, they’ll say “Let me represent you”).  Those agents aren’t going to join our local MLS for that one transaction as both their Broker and the agent would need to join and it would take too much away from their commission they want to get. And let’s be honest, the only reason that an agent would represent a Buyer in an area that isn’t their expertise is for the commission, not because they think they can provide the Buyer with good service.

Another disadvantage of using an out-of-town agent not belonging to the Central Coast MLS is that they don’t have key cards to be able to show properties. You have to belong to the MLS to get key cards.

One of the biggest pieces that an out-of-area agent is missing is the local expertise. They don’t know what’s going on in cities and neighborhoods. They don’t have experience with the local escrow representatives, appraisers, pest inspectors, lenders, painters, contractors,  and other agents. When the property is in escrow, they will be trying to fix any problems that may come up from hundreds of miles away.

What most people (and some out-of-area agents) don’t know is that the out-of-area agent isn’t entitled to be paid any commission that’s offered by the Seller to the Buyer’s Brokerage.  Commission sharing is something that is agreed upon by Brokerages within the same MLS and a broker isn’t obligated to share any commission with a non-MLS member. Some brokers will refuse to share commission with out-of-area agents. I can’t blame them if the out-of-area agent didn’t provide a service, like showing properties to their client.  Having their client come to the Central Coast and calling the Listing Agents of properties to get them  to show them  isn’t a service. Unfortunately, the agent’s commission becomes an issue in a lot of these transactions which doesn’t really help either the Buyer or Seller.

If I’m going to buy a home in an area, I would want to have the agent that represents me be local!

Written by Keith Byrd - Go to Keith's Website/Profile