It seems like the more I talk about Exclusive Buyer Agents, the less real estate professionals in social media want to engage in that discussion. As groups like the NAEBA lobby for national disclosure legislation and states like North Carolina find themselves in a fight over the same, it has occurred to me that some are just not willing to "go there" - even if that means participating in conversations about it on sites such as Facebook, Twitter, LinkedIn, AR, and other outlets. What I find fascinating is the exact opposite is true when I speak to banks, lenders, consumers, and other entities in our community.
I taught an Exclusive Buyer Agent Designation class last week to 28 real estate agents from the Rochester, NY, area. It was a great time of continuing education and relationship building. But most telling to me were the eyes that popped open, two at a time, as an understanding swept over the classroom - any agent who advertises as an 'exclusive buyer agent' while the agency he or she works for takes listings, is not an Exclusive Buyer Agent. A tough pill to swallow for some, but one that was willingly ingested by all.
Nationwide, and specifically in our upstate, western NY market, Exclusive Buyer Agency is the elephant in the room. What's more, it's the elephant in the room that is getting restless and pretty soon, the door will be knocked off its hinges and chunks of the wall will be laying on the floor with it. It is more than apparent to me and my agents, as well as the 28 professionals I had the privilege of teaching, that the general public is generally clueless when it comes to the difference between EBA's and traditional "buyer agents" who may even co-op the term "EBA". What's disturbing is when that cluelessness is demonstrated within the real estate community. For example, a listing agent in Boise, ID, writes on his company website,
"Then call one of the great screened agents on the listings. They are NOT the listing agent. You want an exclusive buyer's agent. Our agents will not try to sell you a listing that they have. They will help you get the best deal on a home you find. You can also call one of them and get automatic real time listings whenever ANY Realtor® lists a new property that fits your exact criteria. No running around looking at what YOU don't want and someone else wants to sell you because they have to sell THEIR LISTING. Our real estate agents are instructed to show you what YOU want to see and only what you want to see. If you want your maximum priced to be $250,000 you won't get pushed to spend more. Promise. We are here to help YOU." (thanks to RainMaker Paul Howard, Cherry Hill, NJ, for originally catching/posting this )
This type of advertising is extremely misleading and uses the term "EBA" in a way that is inaccurate and frankly, deceitful. Not only does he encourage buyers to use one of his agents, making them a promise that they will not try to sell them one their listings, he conveniently ignores the part where his agents take listings in the first place, which precludes them from qualifying as "Exclusive Buyer Agents". Just the fact that they work in an agency that takes listings means they cannot claim to offer exclusive representation to buyers.
Many will argue that binding fiduciary responsibilities are enough to cover the buyer's needs. And while we all hope that every agent will fulfill those responsibilities and conduct honest business, there is a rising tide in the industry and it is just about to break, as "the way we've always done it" is not cutting it anymore - not for buyers, anyway. What would the market conditions be today if five years ago, there had been agencies that only represented buyers and agencies that only represented sellers? I passionately contend it would look dramatically different, notwithstanding all of the factors that led to its demise. The subject of buyers' rights and buyer advocacy is just under the surface where many desire it to stay. But it won't stay there for long and we need to be having open discussions that benefit homebuyers, without mudslinging and self-preserving jargon. As one agent commented on an Inman News article about the NC situation, "It seems like it's an innate conflict of our fiduciary duty to listen to and then advise our sellers, and then take on a new buyer prospect who is asking us for unbiased guidance in the purchase of the same property." An "innate conflict" indeed.
The needs of consumers and the current market are moving us towards separate agencies for buyer agents and seller agents and there is an entire infrastructure of representation and advocacy for sellers already. So I propose - let's get and keep the conversations that benefit homebuyers going! After all, without Buyers, there would be no real estate market.