Dual Agency. Less loyalty. More pay!

Blog Boy...

Now see. I told you folks would be disappointed we skipped the video this week.

Now...As far as the duel agency goes...You know how I feel. I'm with ya baby :)

TLW...ROAR!

BB,

Instead of dual agency...how about dual... Bertha/BB. So let me ask you this...when you use dual agency..who represents the buyer...Bertha? and does that mean BBrepresents the seller..there does not seem to be any dual agency there..two different people so you have a good excuse:)

After reading over the comments once again. It appears as if the question of Dual Agency is as much a part of how each State defines Agency as it is to how we aproach it.

The struggle often is how government agencies want to define and regulate. Which often leads to ambiguity in definitions and difficulty in interpreting and practicing for the practitioner.

Try to say that three times quickly.

BB, yes, and I was thinking about that last night after reading a blog somewhere on AA about Transaction brokering. I guess the few times where I have agreed to a dual agency, I have been more of a transaction representative than anything else (just that we don't recognize such a term here in Ontario). I think that would be a much less-ambiguous and more truthful way of doing business and more fair to all parties when both sides want you to represent them.

Jo 

I do alot of dual agency since I hold a large inventory in a very high turn over area.   Is there an advantage...   well in my case there can be to both..    I have a dual commission arrangement with my dual agency.  If I list your home and sell it myself I reduce the commission by a percentage... so what does that mean... more flexibility to the buyer and seller.  

I do belive that when the property is "hot" and I am representing both ends... there is also an advantage there ... having "control" over the tranacation...  

Just my 2 cents...

Here is the thing with "dual agency".  Even though I am the listing agent and work exclusively with sellers, if anyone of our buyer's agents bring a buyer to the table, we are considered "limited dual agents" (there is no "dual agency" in Idaho).  It doesn't matter that the buyer's agents know nothing about the sellers position or that I know nothing about the buyer's position. The fact is, it's considered limited dual agency.

In our listing contracts, we deal with this possibility right up front and explain the options to the sellers.  After thousands of listings over the years, we have never had a seller say no to limited dual agency.  When it comes right down to it, if our team has a buyer that matches their home, they want their home sold.  No we aren't going to refer out a buyer when we have absolutely wonderful buyer's agents right on our team.  It pretty much comes down to this:  If a seller wants single agency, none of our buyer's agents (nor any of the 100+ brokerage agents) will be showing their property.  If a buyer wants single agency, they can not consider any of our listings nor any of our brokerages listings as options to purchase.

Think Neal is right. You on one side, Bertha on the other. There's already video precedent for it. 

You are right, it doesn't have to be called "dual agency." When it happens there, that term doesn't necessarily carry a negative at the consumer level, unless they have had a negative experience before. About 11% of our sales on the CA side of our market, and 16% of our NV market are double-end transactions.

Whatever it is the two of you are out for today, lets hope it's in video production. 

http://cdnll.img1.imagechef.com/w/070818/sampacd8d67978f76c53.jpg

Great discussion! My contribution: I've done dual a couple of times; I have an "agency discussion" with every buyer before we look at homes. If they are planning on viewing one of my listings, I tell them that it would cause a possible dual agency situation, and if they decide they want to write an offer on that house, they have two options, I can proceed as a dual agent with written permission from them and the sellers, which would mean I would take a step back and "facilitate the transaction" without fully representing either side, but I would continue to hold their (and the sellers') information confidential. Or, we could have another agent step in from my office to be their buyer's agent for this home, and I would represent the seller: this is 'designated agency' in the state of VA, same broker, two agents; dual agency is same broker, same agent. Designated agency then is a form of dual agency, because there is only one brokerage firm involved. The key for me is communication and the clients understanding of who is being represented and at what level. 

In terms of the double commission playing a role in how an agent behaves, how is that different than a single side commission? I mean, there is a commission involved in EVERY transaction, you can't let that affect how you represent a client (I'm referencing the first blog post, the comment that an agent that was two months behind on mortgage payments would push harder to represent a dual agency contract). I can't think about what my commission amount is or when I got paid last when I'm working with sellers OR buyers on a transaction, it has no bearing on the offer being made. I think that's the tricky part of dual agency, the perception that an agent is doing it to be greedy, not because the agent happens to have buyers that are the perfect fit for one of their own listings.

(I also take a reduced commission for representing both sides, so would actually be in my financial best interest for a co-op broker to sell my listing, or for me to sell my buyers a listing that is not my own, but that has no bearing on whether I'd show one of my own listings to a buyer client if it fit their needs.)

I feel like I'm rambling, but here's things I see happening that I think are on the slippery slope:

• agents not showing listings with a lower co-op commission offered than similar properties, even if the house fits the needs of their buyers;
• bonuses offered to buyer's agents above the co-op commission--like they wouldn't show the house otherwise?
• bonuses paid to agents selling 'in-house' listings--whose interest is being put first there?

...there are lots of things that go on in our industry that seem to be widely accepted that aren't in the consumer's best interest. As an agent, I try to ALWAYS put my client's interest first, and let them know of any issues that we may encounter along the way. Even if those issues never come up, the client isn't surprised by something after they have committed to working with me.

I'm parking to read more, it's enlightening to see how it's handled in different parts of the country.

Cheers,

Heather

Ber-tha!   Ber- tha!    Ber-tha!   (the crowd is chanting wildly) 

From Duel Personalities arises Dual Agency Issues.  You cannot be all things to all people.

I say that one of your breastes's can be single or both can be dual:)

Now no representation....you decide..or you can include your butt cheeks as an open representation...a you choose it.

Hi BB,  I guess I missed this post.  A very good one too.  I hate this subject by the way.  In Texas we can "work both sides" but we can not give advice or opinion to either party. 

So what is the point?  I am just going to be blunt here...that is the stupidest thing I have ever heard.  Anyone who thinks they can do that honestly and with integrity is just flat out lying to themselves and anyone else.  IMO of course.

Now,  in regards to Lenn's comment about an Intermediary with appointed agents.  (Same Broker, different agents representing each side)  That is another story.  I do not discuss my business or contracts with anyone in my office anyhow.  I do not personally think that is a big deal. 

That was a great question by John S.  One I think many consumers have and should know the answer to.  And...we will have Bertha next week?  :)

I'm not going to "defend" dual agency. I don't feel I need to. It's a legitimate and legal way of doing business in Illinois and involves clear cut rules and regulations that agents are both legally and ethically obligated to follow. Whether one agrees or disagrees with the concept is certainly their prerogative, but in reality, it is a decision made by the parties involved. I prefer not to pass judgement on consumers or agents for their personal decisions regarding representation.

So here are a few facts:

• I don't make any more money when I undertake dual agency. I actually make less. I do it when and if it's what my clients want me to do. Key words...clients want.
• For sellers, dual agency is discussed at the point of taking the listing agreement (the language is actually written into the standard listing agreement avail through the North Shore-Barrington Assoc. of Realtors). So sellers choose from the very beginning how they would like to be represented, and the pros and cons. Key words...sellers choose.
• For buyers, the issue is addressed prior to even showing them a home you have listed. The dual agency disclosure is given to them up front. They can then choose the manner in which they would like to be represented (whether by you as a dual agent, or if they want their own agent or to represent themselves). Key words, again: buyers choose.

BB. I've mentioned to you before that I sell businesses. For the most part I do not co-op. It takes a special skill set to take a bus op sale all the way to closing. My sellers know I don't co-op. They know I will be representing both sides. It is necessary. My feeling is that a business can not be sold unless both sides are happy. We let them back out at any point prior to the assignment of the lease or transfer of a state license (such as Alcoholic Beverage Control or Depaartment of Motor Vehicles). Everybody must be happy. The few times I've been in transactions where there were two agents the situation was "adversarial" and the deals didn't close.

As for being a transaction coordinator instead of an agent, I don't think so. Both sides need counseling and advice. These are major financial transactions not penny ante.

Bill Roberts

Since we're both Jerseyites, we agree with what Desiree said.  If we can pass a saving on to the Seller of our listing, we do but Dual Agency is legal in our state so it's inevidable that it will come up if you're an active agent.  We do it but we do it as fairly as possible to all parties involved.  If everyone gets what they want and they're happy, where is the harm?