Unless you’re talking really high priced real estate, it’s not much of a conflict. The buyer’s agent is only getting 1/2 of that 3%, so it really doesn’t make that much difference to them if you pay $10,000 or $20,000 more than you should. Where the real conflict lies is that they don’t get paid until the deal closes, so they want you to buy as quickly as possible. It’s even more pronounced on the seller’s agent side. I’ve read studies indicating that when agents sell their own houses, they stay on the market an average of 30 days longer and sell for 2% higher than their customers’ houses. Just about every seller’s agent will advise his/her client to take the first offer that comes along “because you might not get any other offers”, and “you don’t want to let them get away”, or “give them a reason to look at other houses”.
this was covered in freakonomics. bottom line: don’t assume a broker has your best interest as their number one priority. you know, just like every other principal-agent situation in life.
Are you assuming the agent is splitting their cut with their broker? 5 to 6% total is the norm and is completely owned by the listing broker. 2.5% to 3% is usually offered to the buyer’s broker. The broker gets to decide how it’s divided. I, for example, only have to give my broker fifty bucks if I list a home. And fifty bucks if I act as a buyers agent. They’re called 100% commission brokers. The broker lets me control the commission. I don’t use my license often, but certainly has saved me and my family members quite a bit of coin.