buyers talking about a dual agency

Sharing an agent between buying and selling parties has both pros and cons.

Differences between a buyer’s agent, a listing (or seller’s agent), and a dual agent seem quite simple on the surface. When you’re looking to purchase a home in Denver, CO, or any other area of the country, you enlist the help of a buyer’s agent; when you’re ready to sell a home, you seek the services of a listing (or seller’s) agent; in a dual agency setup, one agent represents both parties in a real estate transaction. But as with many of the decisions to be made during the home sale process, there are both advantages and disadvantages to each.

Two agents, one home: Buyer’s and seller’s agents

When you’re buying a home, seeking a buyer’s agent is strongly suggested. Of course, you can browse homes-for-sale listings on Trulia, but a good buyer’s agent will also know of properties that are about to hit the market in the neighborhood you’re searching (or might even sell before a property goes live on the Multiple Listing Service, aka The MLS). Finding the right agent also means you will have someone with specific knowledge of your market, which can be a huge help if they suggest neighborhoods you haven’t considered that are a great fit for your needs.

If you’re selling a home, you could go the for-sale-by-owner route. But enlisting the help of a seller’s agent should be weighed heavily. Listing agents have trade secrets that can help you sell your property — such as staging the home for an open house and sale, knowing which inspections will be required, how to effectively market the house, and perhaps most importantly, what price your home should be listed at — and when you should consider re-evaluating that price.

One agent, one home: Dual agency

Should a buyer forgo a buyer’s agent and work with the seller’s agent instead? Perhaps in a few circumstances, such as if you’re buying from a friend or family member, or if there are very few real estate agencies in your area and you both know and trust the agent with whom you’re working. Keep in mind, though, that a buyer’s agent looks out for the best interests of a buyer, and a seller’s agent looks out for the seller. If you’re a buyer, do you really want to work directly with an agent who’s also responsible for negotiating the highest price for the seller?

It’s for that same reason that, as a buyer, you should be even more wary than sellers of working with a dual agent. And an agent wants the best commission possible, which will result from garnering the highest selling price that they can. You may not be getting the better end of the deal, while the seller is, especially with a dual agent. It’s for this reason that dual agencies are heavily restricted in most states, and even illegal in some.

Have you worked with a dual agent when buying or selling? Share your experiences in the comments!