What's the Difference Between Dual Agency and Designated Agency in a Northern Virginia Real Estate Transaction?
Would you be shocked to know that there are real estate brokers that don't know the answer to this question? You should be. Once you read the explanation, you'll be able to spot a real estate agent/broker that knows their stuff. And the first way to tell is whether or not they even bother to explain the different forms of representation to you that include Buyer Agency (when an Agent represents a Buyer), Seller Agency (when an Agent represents a Seller) or Non-Agency (when the Party in question is not represented by an Agent at all.)
Let's start with a basic concept. When you hire me to help you buy or sell real estate, you are really hiring my brokerage, Long & Foster REALTORS®. I am merely the designated associate to help you through your transaction. Long & Foster REALTORS® has tens of thousands of licensed real estate agents working for their brokerage.
If you hired me as your Long & Foster representative to sell your home, another Long & Foster agent bringing a buyer would be a form of DESIGNATED REPRESENTATION. The brokerage, after alll, is handling both sides of the transaction, but each party has their own representative. If you hired me to help you purchase a home, and you wanted to buy a home listed by another Long & Foster agent, that would also result in designated representation.
DUAL REPRESENTATION would occur if you hired me to sell your home, and I also represented the buyers that wanted to buy it. You would also run into dual representation if you hired me to help you purchase a home and you wanted to buy one of MY listings.
It is important to note, that even though dual representation is legal (for now) in Virginia, I do not personally believe in it. You see, when done by the letter of the Virginia law, dual representation means I can not advise either party to things like price. And it seems to me, that if you hired me to help you buy or sell real estate, you probably expected me to help you with negotiations. So if you are a Buyer that is interested in one of my listings, I refer you to a very competent professional that will be able to actually represent you.
Buyers in particular need to be aware of tripping into undisclosed dual agency when they call Listing Agents about their listings. This recently happened to a friend of mine. She went right to the owner of a home and offered to purchase it. At the time, I offered to represent her, but she said she didn't want that, that she and the owner would do fine without the expense of agents. That owner hired an agent anyway and the buyer was left with the understanding she didn't have an agent, thus left with the feeling of "getting a deal." The tale of the sale in the MLS indicates the agent represented both parties. Did the buyer get a good deal on the house? Who knows? She and the Seller really didn't get the benefit of that type of advice if it was done properly. Or since the dual agency wasn't disclosed, which it should have been by law, maybe the agent didn't play by the rules and only advised the Seller...but remember, got paid for rep'ing both sides anway.
If you were that buyer, wouldn't you want your own agent? Food for thought when you are driving around and calling Listing Agents, reluctant to hire your own agent. It's NOT having your own agent you should be reluctant about. Undisclosed dual agency is the most common complaint to the VREB (Virginia Real Estate Board.) And it's always because one side of the transaction feels they didn't get the representation they deserved. You deserve better than that and I'd love to help you.
Chris Ann Cleland, Associate Broker-Licensed in Virginia, Long & Foster REALTORS®
703-402-0037, ChrisAnn@LNF.com, www.NVARealEstate.net
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