Can the Listing Agent be the Buyer's Agent?
In a typical real estate transaction, there are two agents involved; the listing agent and the buyer's agent. The listing agent obviously works with the seller and lists the property where the buyer's agent works with the buyer facilitating the transaction. While most transactions have two agents, there can be one agent involved in both transactions and this is called "dual agency".
Here's how this typically works: a seller decides to list their property and hires a listing agent. That agent will negotiate with the homeowner to determine the commission on the sale of the property.
This commission is typically about 6%. The commission is split, usually down the middle, between the agent that represents the buyer and the agent that represents the seller. However, the commission is based on the sale price, not the asking price and comes from the sale of the property.
A real estate agent is designed to represent a buyer or a seller. The agent or broker must put the needs and concerns of their client first and foremost so you can see how this can be a conflict of interest when the same agent represents both the buyer and the seller. Who are they more loyal to? Who gets better service?
Many real estate agents who participate in a dual agency will simply say that the seller found them first so they must represent the seller before the buyer. But to a buyer, this means that the buyer's interests, budget, and confidential finances are not at the top of the list for that agent.
This is where it only makes sense for the buyer to have their own agent.
The buyer's agent, obviously, is free to the buyer because the agent gets paid from the sale of whichever home the buyer chooses. The goal for the buyers representative is to make sure that the buyer's needs are met, that they negotiate on the buyer's behalf, and get the best deal and terms for their buyer. The seller is not their client, therefore you know that your needs are being met when you have your own representation.
Can you ever use the same agent to buy and sell?
While dual agency is referred to as the same agent that facilitates the transaction on both ends of the same property, an agent can represent one client in both the sale and the purchase of two separate properties. This is not the same thing. The client is the primary concern whether they are buying or selling. You're not representing two different parties but one client that selling one home and purchasing another.
This is actually the best way to do it, especially if your buying and selling within the same area. Obviously, this is almost impossible if you're buying out of state, but if you're moving across town, it always helps to use the same agent to sell your property and buy another one. That agent is well aware of all the details of the transaction and can help facilitate the deal in a more timely manner. When there's one agent as your go-to and representative, it simply makes the whole deal better.
So I hope I have given you a little bit of clarity on the dangers of dual agencies, the importance of having your own buyer's agent when purchasing property, and the simplification of using the same agent when you need to sell and buy in the same area.
If you're ready to contact me as your buyer's agent for Hampton Roads and various parts of the Virginia Beach real estate market, contact me below. I look forward to representing you on your next home purchase.