Who Works Harder - Buyers Agent or Listing Agent?
With Anywhere Real Estate (formally Realogy) folding, and NAR and other big names still getting sued over buyer and seller commission, it's about time we discuss the duties of the buyers agent and sellers agent.
Historically, the sellers agent (listing agent for some) had a contract signed by the seller which dictated the commission paid to the buyers agent. For decades, that was a 50/50 split.
In recent years, we have seen all types of splits being paid out of the closing, but ultimately agreed upon by the seller and their agent. Unless, of course, the buyers agent had a Buyer Representation Agreement (or whatever you call it in your neck of the woods) signed, which insured that the buyers agent would make a certain dollar amount. Were many buyers willing to pay money out of their pockets to their agent regardless of what was offered in the MLS?
This brings us to an article I wrote years ago...
Who works harder...the Buyers Agent or the Listing Agent?
I think it's time to revisit.
Listing Agents or Buyer’s Agent, who works harder for their money?
The old debate rages on, who works harder a listing agent or a buyers agent? There are two checks paid at the closing, one for the listing agent and one for the buying agent. But the question is who worked harder for their check? Well I’m about to tell you and settle this once and for all.
Disclaimer, if you are indeed a Realtor reading this you are likely about to love me or want to punch me in the face.
Where listing agents have it easy is the old saying in Real Estate that “those that list, last.” The reason that is a timeless Real Estate saying is because whenever a Realtor “lists” a house for sale they almost always have “exclusive right to sell a property” as the listing agent.
Effectively what this means is during that listing agreement, which is often 6 months to a year, if that property sells for ANY reason by ANY PERSON that Realtor is going to get paid the LISTING SIDE of a commission split. This is why Realtors LOVE listings because if its a sellable property they are going to get paid at some point. Once you have listed it you have effectively won its just a matter of when.
Listing a Home
So what kinda craziness do listing agents have to deal with? Well first of all, you have to actually get the listings which isn’t exactly easy. You are fighting with every other Realtor in town to list a property and there is more than a little back stabbing going on.
You sometimes lose listings you should have gotten because others are so willing to over promise their abilities just to get a listing. This is just one reason that choosing the right agent is so important. Then if you actually get the listing you are often dealing with clients who believe their house is worth way more than it is, then you pay for professional real estate photos, fliers, open houses, food, drinks, and lots of other marketing outlets all the while knowing its not going to sell until your client gets more realistic. Sometimes your client calls you and decides they don’t wanna sell at all!
Representing a Buyer
So where to Buyer’s agents have it easy? Buyer’s agents do exactly what it sounds like they do. They are out trying to sell properties to people looking to buy properties. Well, sometimes you luck out and get those clients that buy immediately.
Difference Between a Buyers Agent and Sellers Agent
You occasionally get those wonderful folks that go out for a weekend and find a property then write an offer on it the next day and love you for finding them the perfect spot so quickly and refer you business to all their friends. You aren’t paying for open houses, marketing listings, and all the other hoopla that a listing agent has to deal with. You simply find the properties then your client buys them and all is well right?
Even though technology has drasticly changed the workload of an agent, there is still a lot of work representing a buyer in a real estate transaction. The buyers agent has to schedule appointments, drive buyers around, they show them properties, they often buy lunches or dinners, they scour the MLS looking for properties for the more picky types, and countless other things. Eventually through hard work many buyers fall in love with something and a deal is struck and then the Buyer’s agent gets paid the other side of the commission split so it all works out right?????
WRONG! The issue with Buyer’s agents is sometimes those people don’t actually buy anything. Sometimes, they decide not to move. Sometimes they get approved through a lender that didn’t really vet them so they can’t even buy anything.
Sometimes you show them houses nonstop and then they use their “friend” or “Aunt Jenny” who’s a Realtor and really they were just using you. Sometimes you show them houses for a year but you aren’t available this weekend to show them houses so they go call someone else and completely forget about any loyalties they had to you. Sometimes they buy something and get cold feet and back out the next day, or during inspections, or worse.
So Who Has The Easier Job?
So at the end of the day who’s in a better spot? Who would I rather be? The listing agent every day of the week and twice on Sunday. Sure they deal with their fair share of grief too but ultimately they are a lot more likely to get paid than a Buyer’s agent and they aren’t running the streets non-stop to do it.
Their income is more reliable and their days are more predictable. But the real kicker is, that listing agreement guarantees your client has to be loyal to you and that is worth its weight in gold.
So if listing agents have it so easy do I have to pay 6% to one? Well that depends, if I was going to select an agent I would make it a point to interview more than one and look for a low cost “discount” broker to include just to see what they have to offer you. You never know that might be your ticket to a quick sale and a lot of savings!
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