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What is a Dual Agent in Real Estate

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May 12, 2017 in Business

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Real Estate can be a crazy business at times. You would think everything should be logical but at times it clearly isn’t. If you are going to be buying or selling a home in the near future one of the things you should be aware of is a term called “dual agency”.

When selling a home, more often than not people hire a real estate agent to represent them. If you are looking to purchase a home the same can be said as well.

People hire a professional real estate agent to provide guidance and counseling in what is often one of the biggest financial decisions of their lives. In simple terms the real estate agent representing the seller is known as a “sellers agent” and the agent representing the buyer is a “buyers agent”. Pretty simple right? Well nothing is ever that simple when it comes to the real estate industry.

There is a situation that can rear its ugly head in real estate sales known as dual agency. In dual agency a real estate agent does not represent either a buyer or a seller but both. This is what’s referred to as a dual agent. You might be wondering how that is even possible to represent two parties on the opposite side of the table. Frankly, it isn’t which is why I am writing this article. Dual agency is bad for consumers. When you allow dual agency to occur you give up your right to representation in the real estate transaction. The Realtor who once represented you, no longer does! The agent becomes a neutral party in the sale.

This means that the agent you are paying a large commission check to no longer has your back. When an offer comes in from the buyer your agent can no longer give you any advice on what to do! Sounds awesome right? There are lots of real estate agents who will try to convince you their is absolutely nothing wrong with dual agency. Why do they do this? One word – MONEY! Unfortunately, like many other industries, money gets in the way of doing the right thing.

Some real estate agents are consumer-concentric thinkers. This is the type of agent you want. Agent-concentric thinkers on the other hand have one thing in mind – their own pocket book. Dual agency really should be made illegal in all states. There are a number of places already where it is illegal to become a dual agent.

The only person who benefits from dual agency is the agent. If buyers and sellers truly understood the dynamics behind dual agency, they would never agree to participate in it. Unfortunately, most laymen don’t understand and the one who is explaining it to them is the Real Estate agent who will benefit from them agreeing to it.

So what can you do? When you meet with a real estate agent it is important to be clear right up front that you don’t want to allow dual agency. If you are selling your home you need to get in writing that the agent is going to represent YOU and only YOU! If you are buying a home the same can be said.

It is possible the agent you are working with to find a home might have the perfect listing that fits all of your needs. In this case you should ask your agent to refer you to someone else in their office who can be your buyer’s agent. You would be removing dual agency from the equation. You would have someone in your corner who can guide you and answer your questions as they pertain to value. Is this going to make the real estate agent happy? No of course not! They will be giving up a chunk of their commission. This however, isn’t about what’s best for the agent. In fact, decisions like this should never be about what’s best for a real estate agent.

There is a reason there are more lawsuits when dual agency is involved. Who wants to enter into a huge transaction blindly? Who wants to wonder if one day the agent is thinking of you and the next someone else? The bottom line is to stay away from dual agency. You will be glad you did!

About the author: Bill Gassett is a nationally recognized Real Estate leader who has been providing realty services around the Metrowest Massachusetts area for the past thirty plus years. He has been one of the top RE/MAX Realtors in New England for the past decade. In 2016 he was the #3 RE/MAX real estate agent in New England.

Bill has been servicing real estate sales for buyers and sellers in the following Metrowest MA towns for the past three decades: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton and Uxbridge MA.

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