I’ve been selling real estate full-time since the beginning of 2003, and even before I received my license I made a business decision to never “double-end,” or represent both the buyer and the seller in the same transaction. Here’s why:
Typically, Sellers pay a broker a fee to help prepare, list, market and negotiate the sale of their property on their behalf. The listing broker can either share that fee with an agent who brings the BEST buyer to the finish line, or keep the entire fee if they can find any buyer who will purchase the property and agree to dual representation.
When I represent a seller, I want them to be confident my effort will go toward negotiating the very best price and terms for them, not toward finding any buyer I can make more money from. When a buyer approaches me on one of my listings, I refer them to another experienced agent for representation if they don’t already have one. I have difficulty understanding how an agent can successfully negotiate the very best price and terms for both the seller, and the buyer. That would be sort of like being sued and having the same attorney as the person who is suing you. Good luck with that.
Agents who focus on double-ending transactions may convince sellers to allow limited marketing of the property, e.g., not entering it into the MLS (or delayed input to the MLS) while they try to solicit a buyer to work with them. Withholding the property from MLS systems excludes a significant portion of the potential buyer pool which could hurt the Seller’s bottom line. Sellers deserve the greatest market exposure possible unless there is some reason they don’t want to reach a wide audience.
For clarification, not all dual-agents limit their marketing, and representing both sides is perfectly legal. Many agents do so. However I still believe you (whether buying or selling) should have your own representation.
When I sit with buyers for an initial consultation, I stress the importance of having their own advocate. When a buyer goes directly to the listing agent without their own representation, it is usually the case that either; 1) The buyer is uninformed of advantages of having their own agent, or 2) They believe they may receive some benefit by allowing the listing agent to represent them.
There are many reasons a buyer should have their own agent (and not the same agent as the Seller), especially when in most cases, the buyer’s individual representation is paid by the listing brokerage and there is no cost to the buyer. Here are a few:
The listing brokerage was hired to represent the seller. By law, the listing agent has a fiduciary duty to represent the seller’s best interests.
Negotiations between the buyer and seller can continue throughout the transaction; price, terms, repairs or credits, and any number of fine points. How can the buyer expect the listing agent to negotiate the best possible terms for the buyer when they have a fiduciary duty to do so for the seller?
A buyer’s agent will typically be that voice of reason and independent opinion when it comes to the deficiencies or downsides of a property. A listing agent who wants to get the property sold may not be so forthcoming in pointing out flaws or negative characteristics to the buyer.
Sharing confidential information with your agent can be key to getting terms and conditions that work best for you. Buyers who choose to allow the Seller’s agent to also represent them might be apprehensive to share details that might benefit the other side with an agent who also represents the other side.
Whether you are selling your home or investment property or ready to purchase one, work with an agent who is advocating just for you. You deserve it.