Listing Agents and Selling Agents
You see there are two "sides" to every sale. The listing agent and their office/broker represent the seller’s side. The selling agent and their office/broker represents the buyer’s side. A selling agent is also referred to as the “buyer's agent”. Selling agents (buyer’s agents) do not usually list very many homes for sale. They deal mostly with homebuyers. Selling agents "sell" the homes that are placed in the Multiple Listing Service by the listing agents.
Most agents concentrate primarily on one side or the other. This is not a "hard and fast" rule. There are also agents who split their time equally between buyers and sellers. Often, these are the very best Realtors. The fact of the matter is if you are buying a home, whom do you want on your side? A Realtor who deals primarily with sellers? Or one who deals mostly with buyers?
If you call on a single classified advertisement in a newspaper, or a listing on the Internet, you are most likely calling the listing agent.
Should You Call the Listing Agent vs. finding your own Realtor?
First, very few people actually buy the house they call about. However, for argument's sake, lets say you call the Realtor who is listing the property you "might" be interested in. It turns out that the house is absolutely perfect and affordable and you want to make an offer. Do you want the same agent who represents the seller to also represent you? If the answer is “no” then get yourself a buyers agent to show you the home.
Remember, when you make an offer to buy a house, you are entering a negotiation. The seller wants as high a price as possible and the buyer wants the lowest price possible. Plus, there is much more to buying a house than just settling on a price. If a Realtor represents both sides, there is a potential for conflict of interest, although an ethical Realtor can often do a fair job of representing both sides. The best-case scenario however, is that the dual agent, in an effort to stay neutral, becomes nothing more than the transaction facilitator, other than an agent working actively on behalf of either the buyer or seller. There are so many things that come up during the home buying process, for peace of mind, it may be best to have your own advocate who will tell it to you straight and fight for your best interests.
Other Benefits:
Buyers agents have varying areas of expertise. An understanding economically, of the current supply/demand cycle within a particular area of interest will affect your initial offer price, strategy, and what you can ultimately expect to pay. Buyer’s advocates with experience in renovation and design can help a novice buyer spot a diamond-in-the-rough needing simple enhancements. A knowledge about niche properties i.e.: equine, green, historical, etc. can help buyers find or avoid certain features.
Buyers agents typically stay with you long after everyone else has gone and as the years go by continue to be a valuable resource in your community.
Lastly, the commission paid to your Realtor comes from the seller’s proceeds so ultimately, having your own advocate costs you nothing!
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California Buyers Agency
In California, a homebuyer can choose to work with a buyer’s agent or a selling agent. Either way, your agent is a specially trained professional, licensed by the state of California, who is obligated by law to treat all parties to a real estate transaction fairly.
Selling Agent
If you work with a selling/listing agent, there is no contract between you and the agent, and you are not the agent’s client. You will, however, receive a Disclosure of Real Estate Agency form that lists the fair treatment duties owed to you and indicates that the selling agent is the home seller’s agent.
If you work with a buyer’s agent, you are the buyer’s agent’s client. If you are satisfied working with a particular buyers agent you may sign a WB-36 Exclusive Buyer Agency Agreement that includes a Disclosure of Real Estate Agency. The Disclosure lists the fair treatment duties owed to all parties and the duties owed to you as the client, and indicates that the buyer’s agent is the agent of you the buyer. The buyer’s agent works specifically for the interests of the homebuyer, but also must know how to work with the listing agent. A buyer’s agent can:
- Give advice within the scope of the agent’s expertise as a licensed real estate professional.
- Give an opinion or critique of a seller’s property beyond disclosing defects.
- Give you an opinion about whether a particular house is priced too high or too low, and/or suggest an offer price and strategy.
- Structure the offer, draft offer provisions, and present the offer with the buyer’s best interests in mind.
- Recommend and assist the buyer with negotiation strategies for the best price and terms.
- Assist in the buyer’s investigations of all information including disclosures and history, so the buyer can make an informed decision.
- Manage/oversee the purchase/escrow process, in order to keep the buyer in compliance and within the guidelines of the contract as desired by the buyer.
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My husband and I found an REO property that we are interested in. Since we did not have an agent to show us the property, we called the number on the sign infront of the house. The listing agent came out to show us the home 2 times. At the point that we were ready to make an offer, we realized that we would need an agent to represent us in the transaction. We did not want the seller's agent to represent us, so we didn't even consider the guy that showed us the property- that would be an obvious conflict of interest. So- we found someone with lots of experience in foreclosures who was referred to us by one of my husband's colleagues. When he submitted the offer on our behalf, my husband got a call from the listing agent who was very upset that we didn't not choose him to represent us as buyers. He proceeded to whine about how he never would have driven out to the property or answered all of our questions had he known that we would not choose him to be our agent. He said that we should have gotten our agent to show us the home. At the time that we found the home, however- we did not have an agent. Now, he is requesting a 25% referral fee from our agent (whom we retained on our own).
1) The seller's agent's request for a referral fee seems completely irrational. He had no affiliation with our agent.
2) He didn't even mention representing us in the two times that he met us at the property. It was our assumption that his efforts in showing us the property and answering our questions about the property were part of his job requirements as the listing agent. Isn't that what he get's his commission for?
Can someone help me understand where this guy is coming from? At the moment- the only thing I can think of is that he is desperate and greedy.nata