Buyer-Broker Agreements in Hermosa Beach and Manhattan Beach

Why Buyer-Broker Agreements Matter in the South Bay

California uses three common types of buyer-broker agreements, with the Exclusive Right to Represent form carrying the most weight because it is the version most brokerages prefer. Here is what each one means for you.

Non-Exclusive, Not for Compensation

This is the least common option, and most South Bay buyers skip it. It spells out the broker’s duties to you and your responsibilities as the buyer, but it leaves you free to work with other agents at the same time. The agreement states that:

• The buyer may hire more than one broker or agent to locate a property

• The buyer is not obligated to compensate the broker or agent

• The buyer has the right to demand single agency, meaning the agent cannot also represent the seller

• Either the buyer or the broker can cancel this agreement at any time

Non-Exclusive, Right to Represent

This version defines the broker’s responsibilities to you, the buyer-agent relationship, and your obligations. It provides for compensation to the broker if they present the home you end up buying or otherwise represent you, but it removes your responsibility to pay a commission if the broker is compensated by another party, such as the seller. Under this agreement:

• The buyer may purchase a property through another broker or agent, as long as that property was not introduced by the first broker

• The buyer has the right to demand single agency

• The broker or agent can receive a higher commission than the negotiated fee in the agreement if the seller elects to pay more, as long as it is disclosed

Exclusive Right to Represent

This is the most common agreement between home buyers and brokers in Hermosa Beach and Manhattan Beach, and the one Levine Homes Real Estate & Construction typically uses. It outlines the broker’s obligations, the broker-agent relationship, and the buyer’s responsibilities. It sets the commission owed to the broker, and that commission is owed even if you find the house yourself or another broker does. However:

• The buyer cannot hire more than one broker or agent to represent them

• The commission is negotiable

• The buyer has the right to demand single agency

• The buyer is not responsible for the commission if another party, such as the seller, pays it

• The broker or agent can receive a higher commission than the negotiated fee in the agreement if the seller elects to pay more, as long as it is disclosed

Non-exclusive agreement terms typically run a month or two. Exclusive agreement terms usually run anywhere from 30 days to a year. If you later purchase a property your agent introduced to you, you will owe that agency a commission even after the agreement ends.

Unlike the other two agreements, the main benefit of an exclusive right to represent is that your agent knows you are working with them alone. They are not competing with other agents for the commission, so they have more reason to stay focused on finding you the right home. This matters in a market like Hermosa Beach or Manhattan Beach, where good properties are often sold before they hit the open market and your broker’s relationships carry real weight. As both a licensed real estate broker and a CSLB-licensed general contractor, Mike Levine sometimes gets asked whether the construction side of the business creates a conflict when he is also your buyer’s agent. It does not. You are never obligated to use Levine Homes Real Estate & Construction for any remodel or build, and your buyer-broker agreement covers the real estate transaction only.

Getting Out of the Agreement

Before signing, ask your broker or agent whether they will release you from the agreement if the relationship turns out not to be a good fit. Agents are not required to agree to this, but if they will not commit to it upfront, that is worth thinking about before you sign. A broker who is confident in the value they provide should not need a contract to keep a client who wants out.