In the last couple of weeks, I have been thinking about Dual Agency and it's place in the Philadelphia real estate market. In some states, it is not allowed. In Pennsylvania, it is. On the consumer notice it states:
"Dual Agency is a relationship where the licensee acts as the agent for both the seller/landlord and the buyer/tenant in the same transaction with written consent of all parties."
I am interested in knowing what other people's opinions are regarding dual agency. I have done several dual agency transactions this year and I have a feeling it will continue to be more frequent as a direct result of the intensive internet marketing that we do on our listings. Basically, since we do so much marketing, often times buyers will come directly to us. When they do, we will show them properties that fit their needs which may or may not include some of our own listings. If the buyer decides to write an offer on one of our own listings, that is when we may begin to act as a dual agent.
Based on our past experience with these transactions, I think there are 3 main benefits of dual agency:
1. Transaction can be smoother and more streamlined as well as being more transparent - you do not have to wait around for the other agent to respond or in some cases, educate the other agent regarding the property (condominium association, the short sale process...etc) Acting as the go-between can be extremely efficient and effective.
2. Real Estate Commission - Often times, it can benefit both buyer and seller that a dual agent is involved for there maybe an agreed upon commission that is a little lower which allows some more negotiation room, either on the sales price or perhaps in repair concessions. For example, we may take a listing with an agreed upon 6 percent commission but it would be stated that if we brought the buyer, it would be 5 percent.
3. Increased showings for the seller - Because of our internet marketing, we generate a tremendous amount of leads for each listing. If dual agency was not applicable, what would we do with those leads that want to see the property ? Hand them to someone else and hope that those leads are communicated with ? Thus, we can show the properties ourselves or refer them to someone in our office.
I think it is important to note that it is not our goal to be a dual agent. When it happens, we enter into it cautiously and state the benefits to both parties. The bigger picture is that we are an advocate for our clients and feel that this can be accomplished in all of the types of agency that we practice: seller agency, buyer agency and dual agency.
Also, every case should be looked at individually. If the listing agent is representing themselves or a family member, that might be different where the buyer might be better off served with their own buyer agent. This can all be discussed with the seller when the listing is taken.
In doing some research, I found some blog posts on Active Rain that also discussed dual agency that are worth reading:
What is your opinion of dual agency ?