Buyers Agents vs. Listing Agents – Dual Agency
On Friday, I blogged about Buyers Working Directly with Listing Agents Instead of Using a Buyers Agent, and I received a surprising amount of feedback.
What was even more surprising though was that most of the feedback was from listing agents as opposed to buyers agents – and all of them were opposed to dual agency (representing both buyers and sellers for the same transaction).
I found that particularly interesting because all of the listing agents who emailed me list properties in the $1 million+ range and are thus leaving $30,000 to $40,000 on the table in some cases when they refuse to represent buyers.
I should add that I have no dog in this fight and that there are obviously many ethical and talented agents who do represent both sides of a transaction on occasion, and that the practice appears to be more common in some markets than it is in others.
In addition, the bulk of the comments were from listing agents in the red-hot Bay Area market, so it would appear that the competitiveness of a given market might influence opinions as well.
And finally, while the bulk of the readers of this blog are real estate agents, thousands of consumers now see it every day too because of our SEO presence.
Hence, I think the below comments from listing agents are good for consumers to see too, as the idea of “working directly with listing agents” is obviously well-known and hardly new.
Comments From Listing Agents
Below are several unedited responses from agents who responded to Friday’s Blog.
Response #1:
We had buyers that tried to do this on our last two listings and we told both that we weren’t interested. One, we referred to another agent in our office, the 2nd one we convinced to continue working with his current agent. The first one ended up not even making an offer on the property. The 2nd one made an offer through his existing agent and their offer was chosen out of 8 offers.
Most importantly, I don’t trust buyers who are willing to screw over their own agents. Those people are the ones most likely to cause issues later or be a liability issue after closing.
I personally hate dual agency. I wish it were illegal. It creates an aura of distrust with the seller you’ve contracted with, no matter how careful you are about it. That seller is the source of new business through repeat business, referrals, and testimonials. In many cases, this comes up during the listing presentation and we volunteer that we will not represent any buyers for their home, unless it was a buyer we were previously working with prior to the listing.
The last dual agency sale I did was in 2019. It was miserable. The property had been on the market for a while, so I was glad to get any offer, but even though I gave the seller a discount on commission because I was representing both sides, she was immediately irked that I was “their [the buyers’] agent.” Throughout the transaction, both parties treated me as an adversary and trust was non-existent. Both parties felt like they were getting a raw deal in the end and I didn’t even put the buyers on my marketing list for the future because they were so awful.
In this type of market, it can also sow distrust with other agents, and in our small market area, that’s a big deal. The market is not always going to be this hot and I want those solid relationships for the future. It can create some bad blood if there’s 10 offers, and then MLS shows the seller miraculously accepted the offer through the listing agent.
For what it’s worth, in our area during this crazy market, I haven’t seen any properties double-ended that I can think of. I checked MLS for the 94598 zip code where most of our business is and only 5 out of 159 sales this year have been double-ended, so I think my sentiments are not uncommon.
Response #2:
Going to the listing agent directly is definitely common in some areas. I think the biggest factor in this is that these buyers, who think they are gaming the system, assume they are the only ones going directly to the listing agent. Every time we have a listing in the tri-valley, there are no less than a dozen buyers calling us directly telling us how qualified they are and how they don’t have an agent. In a market like this where everyone is working so hard, we don’t waste our time with people who are unwilling to commit [to an agent].
Response #3:
Just wanted to throw this out there, and I doubt I’m the only one having this thought – very few ethical listing agents will “double-end” in a multiple offer situation. It just reeks of conflict of interest – I never double end unless it’s CLEARLY in the best interest of both parties and that’s pretty rare. I refer any unrepresented buyers to office colleagues – still technically “double end” because we’re at the same brokerage, but it’s still independent representation without direct knowledge of the sellers expectations or the terms of other buyer’s offers. I think every agent in our community sees an agent who double ends in a multiple offer scenario as “shady” and reputation is priceless in our market/RE community.
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