Buyer Brokers: Do They Make a Difference? Their Influence on Selling Price and Search Duration

Elder, Harold W.; Zumpano, Leonard V.; Baryla, Edward A.

doi:10.1111/1540-6229.00804

Cited by 70 publications

(35 citation statements)

References 9 publications

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“…For example, previous research has shown no appreciable impact by brokers on property price. See a working paper by Johnson et al (2002) as well as Munneke and Yavas (2001) and Elder et al (2000) for a representative sample of this line of research. Also, a significant body of research is dedicated to testing the informational efficiency of residential real estate markets.…”

Section: Introductionmentioning

confidence: 99%

Price Effects of Non-Traditionally Broker-Marketed Properties

Johnson

Springer

Brockman

2005

J Real Estate Finan Econ

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This study investigates whether or not non-traditional marketing has an effect on the prices paid for residential real estate. Non-traditionally broker-marketed properties are defined as those properties that are sold with the aid of a real estate broker, but not marketed through a Multiple Listing Service (MLS). An analysis of properties that sold in this fashion offers further insight into the intermediation role of the real estate broker, as well as an opportunity to further investigate the efficiency of residential real estate markets. Specifically, we can assess whether MLS participation generates higher prices by determining whether like-kind properties price equivalently despite differences in their mode of marketing. The results show a significant and positive impact by non-traditionally broker-marketed properties on property price suggesting, for this sample, a premium of over 6% compared to like-kind properties marketed through the MLS. This premium may be a result of brokers intermediating a better matching of buyers and sellers. The observed premium also suggests a degree of market inefficiency. Copyright Springer Science + Business Media, Inc. 2005market efficiency, intermediation, principal-agent, residential brokerage,

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Section: Introductionmentioning

confidence: 99%

Price Effects of Non-Traditionally Broker-Marketed Properties

Johnson

Springer

Brockman

2005

J Real Estate Finan Econ

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“…Suppose the commission φ between a seller and a broker is established by Nash bargaining before the broker inspects the 11 Both the hold-up problem in this class of models (see Spulber 2009) and the non-existence problem of the equilibrium with trade as r approaches zero are well known (e.g. Camera and Delacroix 2003).…”

Section: Appendix A: Nash Bargainingmentioning

confidence: 99%

Information externalities and intermediaries in frictional search markets

Shi

Siow

2014

Canadian J of Economics

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In frictional matching markets with heterogeneous buyers and sellers, sellers incur discrete showing costs to show goods to buyers who incur discrete inspection costs to assess the suitability of the goods on offer. This paper studies how brokers can help reduce these costs by managing the level and mix of goods in their inventory. We find that intermediaries emerge and improve social welfare when there is sufficient heterogeneity in the types of goods and preferences. Our analysis highlights how learning and inventory management enable search intermediaries to internalize information externalities generated in unintermediated private search.

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“…Elder et al (1999Elder et al ( , 2000 use nationwide survey data and find that buyer agents do not exert any effect over home sale prices. Their primary effect is to reduce buyer search time; in particular, buyer agents are more effective in this reduction than are selling agents.…”

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confidence: 99%