Home Buying in San Francisco>Question Details

Oz, Both Buyer and Seller in 94107

Buying a property and using the same realtor that is representing the sellers.

Asked by Oz, 94107 Wed Apr 29, 2009

I am ready to buy a property (in the Castro, San Francisco) and am considering letting the seller's realtor complete the transaction (with the hope that it will reduce the sale price).
I am not a realtor but am very versed in the local market. I believe I know what the place is really worth to me and most definitely have done all the work on my own to identify the property.

So the question is:
1. Aside from saving some of the realtor commission (which is paid by the seller, but less commission will hopefully help me negotiate the price down), are there any pitfalls that I should be aware of?
2. Other benefits I may not be realizing?
3. Most importantly, what is a reasonable commission for a realtor who is representing both buyer and seller, and therefore does not have to share half with another realtor? (assume total commission is 5%).

Help the community by answering this question:


Um not a real estate pro but good student of the human condition. Since all the RE pros that posted here are all so capable we can fairly well assume the listing agent of the seller listed the property at as close to fair market as could be expected by any other. As opposed to $50 to $100K over (why would he/she because now their in the bind of not being able to deliver) as some have suggested. If that were true the buyer (he seems well informed) could make an offer via the listing agent based on that but with an additional 1% less than he might be prepared to offer if there were two agents and not say a word. The offer will be presented and accepted or not. If so great (we already covered it the listing RE agent is as competent as any other and the buyer is no fool) if not the buyer can suggest he isn't prepared to go any higher perhaps something can be done with the commission to make this work. If so great he gets his additional 1% if not maybe it is priced too high and there will always be others. Conversely if there are two agents that need to get paid 2.5% each under the exact same circumstances it seems to me that that makes it even less likely the deal will close doesn't it?
1 vote Thank Flag Link Mon May 17, 2010
Good luck Orie. I have one question for you. Have you asked the listing agent if he will give you the 2.5% commission or credit you that amount? The agent might, but I don't think the broker will.


Web Reference: http://DavidTapper.com
1 vote Thank Flag Link Thu Apr 30, 2009
Hi Orie,

Technically, the commission is between the listing Broker and the Seller. The listing agent agrees to pay a buyer's agent half or whatever is agreed upon. If the listing agent sells the property to his own buyer, she or he (and in particular, their Broker) is entitled to the entire amount.

A listing agent may be willing to negotiate with the seller but this is really between the seller and the listing agent, not the buyer. The reduced commission will also have to be approved by the agent's Broker (company).

It's somewhat hard to believe that the seller or the listing agent would set it up to benefit the buyer rather than the seller. The listing agent's fiduciary is to the seller. If you have your own buyer's agent, their fiduciary is to you.

Sometimes, this works out well for all parties but there is a reason that the vast majority of San Francisco home sales involves a cooperating Broker (buyer's agent).

A good agent's ability to negotiate on your behalf before and during escrow and protect your interests throughout will more than cover any discount you may receive. (Not to mention that your own agent wants you to buy the best property for you and not just the one she has listed.) But alas, this is my opinion as a good agent & effective negotiator! :)

It's a great time to buy so I hope it works out for you!


Danielle Lazier, San Francisco Realtor
Zephyr Real Estate
415.731.5000 x158
danielle (at) zephyrsf.com
Web Reference: http://sfhotlist.com/blog
1 vote Thank Flag Link Thu Apr 30, 2009
Thanks to all the realtors who took the time to answer. This is helpful, but I am wondering if there is anyone out there who isn't a realtor, and who bought or sold their place using the same realtor as the other party. Any advice?

To recap, I feel comfortable enough with the price I'm going to offer; I did the comps myself (they are all publicly available on Zillow, MLS and Trulia), know what the place was originally purchased for (Zillow) and what comparable places sold for recently (I know the area very well, have been to most comparable open houses in the area in the last year or so, and am closely following the market), and most of all, know my own finances. I believe I am also quite savvy when it comes to construction, but will still have an inspection done on my behalf. I read the disclosure package and even interviewed other condo owners in the building (does any realtor really interview the neighbors on behalf of their client?)

I also don't understand the claim that the buyer's realtor is free. If the seller is "paying" for the buyer's representation, the fees all get compounded into the sale price, including the 2.5% buyer's realtor fee (or 5% total for the seller's realtor fee, that then gets split by the two)
Would a reasonable seller not be willing to reduce the price by amount they are saving in realtor fees if they knew that this will bring the deal to a close?
1 vote Thank Flag Link Thu Apr 30, 2009
Dear Orie Zaklad,

I'll answer your question, if you answer mine. Would you use the same attorney to represent you and your spouse in a divorce where you disagree and have different goals? Would you be comfortable having the same lawyer to represent both sides in a claim for your personal injury damages? If you answer no, then why not?

1. Question: Aside from saving some of the realtor commission (which is paid by the seller, but less commission will hopefully help me negotiate the price down), are there any pitfalls that I should be aware of?

Answer: You're right the seller pays the commission! So why would an agent give up their commission to double their work and expose themselves to twice the liability? Is it a reasonable expectation to have someone do twice the work for half the pay? What kind of job do you think that person might do?

2. Question: Other benefits I may not be realizing?

Answer: I can't think of any.

3. Question: Most importantly, what is a reasonable commission for a realtor who is representing both buyer and seller and therefore does not have to share half with another realtor? (assume total commission is 5%).

Answer: The reasonable commission for a realtor taking on both sides should be the full commission plus! They are doing twice the work and instantly double their exposure once either side feels they have been taken advantage of... There are plenty of attorneys who love these cases!

My best advice is to get your own agent! Someone who knows the area and has plenty of experience in the market for the property you’re looking at. Let them do their job, ask those lots of questions and let them get paid for their professionalism.

I've completed hundreds of transactions over the years and only represented both sides in five transactions. These were exceptions where both parties agreed upon price, there was full disclosure upfront and no negotiations. After each of these transactions was over I wound up with a file three times the size of any of my regular transactions. My buyers and sellers both thanked me; they saw the results of my work and didn’t question my commission. I know there are a few agents who are perfectly comfortable doing both sides of a transaction concurrently; however I am uncomfortable negotiating with myself.

Good luck!

Michael Ackerman
Zephyr Real Estate
4040 24th Street (between Noe and Castro Streets.)
San Francisco, CA 94114
1 vote Thank Flag Link Wed Apr 29, 2009
Hi Orie,

Its all based on the listing agreement. When a seller chooses to list his or her home with a broker, they are asked to sign a contract that clearly outlines the fees involved. Assuming that the listing broker and the seller agreed to a 5% commission, the seller is contractually obligated to pay the listing broker 5% of the sales price upon the sale of the property.

The listing broker typically will advertise a percentage to the cooperating broker (the buyer's agent.) It is customary to the listing broker to offer 50% of his or her commission to the cooperating broker. In most cases, that amounts to 2.5% of the purchase price.

The answers that have been posted are all good. I also understand that you feel you do not need the services of a buyer's agent because you've performed your own analysis. However, the system is set up in such a way that the seller pays the commissions to the real estate agents. Therefore, you may choose not to exercise your right for representation however its unlikely that you will be credited for the cooperating broker commission.

I would like to take this opportunity to say that I am a actively practicing real estate agent in San Francisco. Some folks feel that real estate agents are self serving and therefore the information we provide is skewed. I think it is very smart of you to be discriminating as far as gathering your information and therefore I would encourage you to visit the California Department of Real Estate Website.


If you follow the URL above, it will take you to a Home Buyers Guide Book. This may be a great independent resource that will point you in the right direction.

Please feel free to contact me if I may provide any further information.

James Testa
Paragon Real Estate Group
0 votes Thank Flag Link Thu Apr 30, 2009
Dear Orie,

I think your mind is already made up. The realtors answers are good. In my opinion, you lose the person whose fudiciary responsibility is to you and not the Seller. The Seller's agent has a fudiciary responsibility to the Seller and not to you. How do you know you are getting the best representation from the Seller's agent? Are you then going to have that agent sell something for you? What has he/she promised you when you spoke to him/her?

If you are trying to save money, I would have an attorney look over the paperwork and also counsel you on negotiating. Do you have all the sale prices for the last 3 months? That is what you need to negotiate.

Good luck,

0 votes Thank Flag Link Thu Apr 30, 2009

These are all great answers. I really don't have anything to add to these except to ask you to read them all and take them to heart.

Tony Abad
Realty World

0 votes Thank Flag Link Thu Apr 30, 2009
"with the hope that I'll reduce the sales price"

in my estimation, you need data to negotiate. not a biased agent

don't over pay by 5% hoping he/she will save you 2.5%

in addition, the commission is already pre-negotiated. you won't be changing that. you need to negotiate the price, not the commission
0 votes Thank Flag Link Thu Apr 30, 2009
I forgot one thing Orie. If the listing agent represents both you and the seller, you might get 1% or nothing at all. The listing agent might have an agreement that if they represent both the buyer and seller they have to give the seller back 1%. That means there is nothing left for you.

The agent will also have double the liability, and we have to pay for insurance on all transactions. It's called E & O insurance. For errors and omissions.

Good luck,

Web Reference: http://www.DavidTapper.com
0 votes Thank Flag Link Wed Apr 29, 2009
Hi Orie,
The best way for me to decribe this is perception. Your perception and many others before you believe that if they can cut out one agent, they can save money. MAYBE! But probable not.

First of all, you are not an agent, and you are not getting the commission. And most PROFESSIONAL agents are not going to give you their commission just because you want to save money. Like Cheryl said, you might save a few bucks.

But, what if you had a good buyers agent and they could save you $50,000-$100,000. Would it be worth it then? Remember, if your buyers agent doesn't get the home for you, they don't get paid. That's a lot of Incentive and motivation! If the listing agent doesn't get the right deal for you, they still have the listing. Big deal.

Here is a real scenario for you. Depending on how long the property has been on the market, when the listing agent went for the interview, they went over the comps in the area, and shared their marketing plan with the seller. They told the seller that their home should sell for XYZ if they listed if for ABC.
Now, you write an offer and the sellers agent represents you. How strong do you think the seller/buyer agent is going to be with their seller when they present your offer when they just promised to sell their home for XYZ? I think they are going to tell their seller that they have an offer, but it's a lower than what they were looking for.

Now the agent comes back with a counter offer to you and says, hey, this is what the seller is willing to do.
How do you know if that's the best they can do. I just went thru a 5 counter offer transaction for my buyer. We knew. Would you?

Orie, you "might" be able to save 1%. Is that a great deal in this market? It all depends on your Perception. It also depends on how the home was priced, the location, the condition, and supply and demand.

Orie, sometimes it's best to let the professionals do the work for you. It's a lot of money.

As well versed and savie as you seem, you will NEVER know if you got the BEST price or could have saved thousands more without having an agent who's sole responsibility is to get the best possible deal for you.

Feel free to visit my web site, I'm a native San Franciscan and would love the challenge of getting you the best possible price. But I can also vouch for Cheryl. She is also a very good Realtor in our industry.


Dave "Tap" Tapper
Cashin Company
Web Reference: http://www.TeamTapper.com
0 votes Thank Flag Link Wed Apr 29, 2009
Hi Orie,

One of the biggest misconceptions about real estate is that the primary purpose of hiring an agent is so they will locate the property for you. That may have been true years ago when agents used a big fat book to locate new and appropriate listings for clients. However, today with information so available via the internet and public access sites for the multiple listing services, I find that many of my clients locate their future homes on their own.

The real work begins after the property is located. There are inspections, possible further negotiations, request for credits, title issues, disclosure issues, insurance issues, loan issues, lot line adjustments, encumbrances, liens, etc. that all have to be addressed, negotiated and remedied. If something out of the ordinary occurs, who is on your side?

There is no basis for expecting that you are going to save on commission. The listing agent will be representing both sides and will be entitled to a full commission unless the seller renegotiates something different. Any agreement that varies from the original listing agreement will have to be approved by the broker.

The seller pays for you to receive FREE representation for one of the largest purchases you will probably make in your lifetime, so why not take advantage of it and hire someone, for FREE, in case I have mentioned that already, to represent your best interests and get you a screaming deal?

This listing agent is retained by the seller and has a fudiciary responsibility to the SELLER, not to the buyer. Ponder this: how can the listing agent represent the seller to the best of their ability and also get you a great deal? It is not going to happen and believe me when I tell you, this misconception is alive and well and you are not the only buyer to consider this strategy.

I have represented both sides on two occasions in my 14 year career and they were special circumstances. For example, one family member was selling to another family member. On another occaision I had a listing which wasn't ready for market because the tenant was still in the property and I also happened to have a buyer for the property. The price was previously agreed upon by the sellers and I presented comparable sold prices to my buyer and it was a done deal. Even under these unusual circumstances, I felt somewhat uncomfortable.

Regarding your question about a possible reduction in commission; I reduced my commission on the two deals to 4%, but as I mentioned, those were special circumstances and I was dealing with past clients. For a stranger, I would not complete the transaction for less than 5%, but I am sure you can find someone who will.

It could turn out just fine if that is the road you are determined to travel, but it could also be a sticky wicket.

Good luck!
Web Reference: http://www.nancycorsaut.com
0 votes Thank Flag Link Wed Apr 29, 2009
Hi Orie,

Why take the risk of not getting full and fair representation? Working with your own agent will ensure that you have someone negotiating the best price & terms on your behalf. It’s very difficult for an agent to represent both buyer and seller for the same property since there’s an immediate conflict of interest.

I doubt that you’re going to be saving that much on the commission, perhaps a few thousand dollars especially since there is more liability involved for an agent involved in dual representation. What you are giving up is in the final price that your own agent could have negotiated for you. Perhaps $10-25K+ or more depending on the property? I completely understand why you would consider this approach but you may very well end up overpaying for a property without realizing it.

From the stand point of the list agent defending their list price, that agent will present comps (recent sales) to buyers agents that support how the price was determined whereas your own agent will present comps that support your offered price. If you decide to hire your own agent, make sure they/their company is active in the neighborhood and has seen the comps. My company is extremely active in the Castro from both the listing side and representing buyers.

I know that when I’m working with my buyer clients that I am very critical of properties and will point out the “flaws” which in the future can make it more challenging to resell that property. Will an agent who is representing both sides do the same? There is nothing wrong with buying a property that has floor plan or location challenges but those details need to be appropriately factored in to the offered price.

If you still decide to go with the list agent, at the very least make sure to get your own pest inspection and contractor’s inspection. The pest inspection will provide a second set of numbers (assuming the list agent has done a pre-sale pest inspection) and the contractor’s inspection will allow you to learn the details of the systems of the property. Hopefully, there is a complete disclosure package. Having your own agent also helps to ensure that disclosures and point of sale requirements (tank inspection, energy audit) have been properly provided by the seller and list agent.

Best wishes,

Cheryl Bower, Realtor , GRI, ABR
Cell 415.999.3450
Zephyr Real Estate
Web Reference: http://www.sfbungalow.com
0 votes Thank Flag Link Wed Apr 29, 2009
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