Why should I NOT use the listing Agent to buy a house?

Asked by Jason, 94544 Wed May 20, 2009

I am looking to buy a house on the East bay in the coming month . I don't have a buyers agent and I really liked the listing agent on one house. Is there any good reason why i should not have the same agent represent me as well? I am planning to hire my own ppl to do inspections, etc... and I am fairly familiar with the market (locations, price/sq, comps, etc...)

Please let me know what you think? thanks

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Steven Ornel…, Agent, Fremont, CA
Wed May 20, 2009
Hi Jason,

A DRE licensee in CA can act as a Buyer or Seller's agent. Similarly, that same person can act as both in a transaction - with the documented consent of both Buyer and Seller. An undisclosed dual-agency is a felony in CA. This is a topic that was covered quite well in during my Accredited Buyer’s Representative (ABR) Certification.

An Agent has certain Fiduciary duties to a client (A fiduciary duty is the highest standard of care possible). These can be boiled down to Loyalty, Obedience, Diligence, Disclosure, Accountability, and Confidentiality.

Here's the core potential problem: One Agent cannot provide full Disclosure and maintain full Confidentiality at the same time. To avoid this conflict of duties, a Dual-Agent may not place either client into a beneficial position over the other.

For example, a Dual-Agent can provide the asking price of a home but can’t provide advice as to its appropriateness. Similarly, say a Dual-Agent performs a Comprehensive Market Analysis. The findings can be shared between the two parties, but not interpreted for either client. In these situations, I have suggested that a current market appraisal be used to set price, with the appraiser being selected by both parties.

The decision to allow a dual agency is a personal choice. Your question concerning advantages or disadvantages should additionally be directed towards the agent. Based on those responses you can make a decision. You may also want the agent to provide referrals that you can contact to see how prior transaction went (ask them if they would do it again).

Since the Seller pays the commission to the Buyer's Agent there really is no reason not to get professional guidance when purchasing a home if identifiable benefits of the proposed dual-agency are not present. After all, the Seller starts off with dedicated representation – you may want this too!

Best, Steve
1 vote
Krista Miller, Agent, Berkeley, CA
Wed May 20, 2009

Ooh, great question! As agents, we always hope for a smooth transaction where everyone is happy and no problems come up. But things do come up, a lot. As other's have mentioned, it is really hard for the agent to be fair and just to both sides, and the listing agent's first obligation when the listing agreement was signed was to the seller, not the buyer. Whether it be negotiating the purchase price, negotiating a credit for repairs, or negotiating an extention of time, you want someone to be your negotiating advocate 100% of the time throughout the process. If someone is negotiating for both the seller and buyer, it makes it tough to be your advocate all the time.

Perhaps there are some buyers or sellers out there reading this question who can provide their experience where their agent represented both sides...would love to hear!

Good luck, Jason.

Web Reference:  http://www.kristashouse.com
1 vote
Jim Walker, Agent, Carmichael, CA
Thu Feb 23, 2012
Since you really liked that one agent, you could ask the listing agent of that one house to show you the competing houses that you have not yet seen, then once you have seen the competing houses, if you still like his listing best, AND if his seller is willing for him to be a dual disclosed agent (most sellers are willing) then I don't see the harm as long as you are as sophisticated and knowledgeable as your post conveys that you are. Having him show you the other houses will help you decide both on him and on the houses.
0 votes
Pacita Dimac…, Agent, Oakland, CA
Wed May 20, 2009
I have done very, very few deals where I represented both the buyer and seller.

It can be a real challenge, particularly at a time when there may be a breakdown in negotiations over credits and repairs. That's when one asks "Whose side are you on?" The negotiation process is constrained since the agent can only relay what one says to the other but not truly negotiate for either one. It's more like a mediation/arbitration.

My first deal was one I wish I didn't have to do. Everything was going fine until we hit a brick wall on the lender side wherein our closing was delayed. My seller, who already moved out, ended up making another mortgage payment. My buyer had to scramble to organize movers, utilities transfer, etc. We were 2 weeks behind in closing. And both of them were upset with me although the lender delays were not my doing.

My last deal was a charm because both sides were so agreeable and reasonable.

Here's the deal: if you want someone to be your advocate, then find someone who will look out for your interest from one side of the negotiations table: YOUR side. You don't need an arbitrator, you need a negotiator.

Good luck!
0 votes
Gina Odom, Agent, Santa Cruz, CA
Wed May 20, 2009
Why would you? It costs nothing to you to have your own representation. You might also get a better deal if you have someone negotiating for you. In my five years of working in the East Bay market, I have never double-ended a deal. I am not saying there is anything wrong if an agent chooses to do so, however, for myself, I want to give all my energy and time to my client and make sure they are getting exactly what they want.
0 votes
Nicole Bailey, Agent, Seattle, WA
Wed May 20, 2009
Hi Jason,

If you like the listing agent, there is no legal reason why you shouldn't work with her. Her first duty remains to her seller though, so it is important to keep that in mind. It sounds like you understand the process well and can fend for yourself through the transaction.

I would ask you what you are hoping to get from your agent, because in most cases, you get the best price and deal by having your own agent advocate for your side of the transaction.

You will love Albany! It is a great community with excellent schools. Good luck!


Nicole Bailey
0 votes
Gayle Hough, , Oklahoma City, OK
Wed May 20, 2009
State laws vary considerably. In Oklahoma -- where I am -- if I am the listing agent and have a "single party" agreement with my seller, which I always have, by law I can assist a buyer only as a "transaction" broker. This means I have to behave ethically and honestly with the buyer, but I can not provide the buyer with any "adivice" or "best judgement" based on experience, etc. If you're an experienced home buyer, and feel confident in you own abilities, fine--let the listing agent write up the contract--but if it comes to negotiating some aspect of the purchase, who's on your side working for you? We know the listing agent is working for the Seller. This is what I also tell buyers who want to purchase one of my listings. "I can write the contract according to your directions, but I can give you no advice and by law and contract must work for the best interests of my client, the Seller." It amazes me how often the buyer will still want me to write the contract, mostly because they want me to be their seller agent and their current home.
0 votes
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