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When you buy or sell a home, you rely on your real estate agent to be your guide. It's a big decision, and people often wonder about the agent's role in the process.
A common question people ask is, Can a realtor represent buyer and seller in the same transaction? The simple answer is yes! In this guide, we will discuss the major risks and solutions you need.
What is Dual Agency in Real Estate?
Think of your real estate agent as your team captain. Their most important job is to protect your interests and help you succeed. This special promise is called a "fiduciary duty."
But in a dual agency situation, one agent tries to be the captain for both teams at once. This creates a big problem called a conflict of interest. The seller wants the highest price for their home, while the buyer wants to pay the lowest price possible.
An agent cannot cheer for two opposing goals. They cannot give you advice on price or how to negotiate. This is a big deal, especially when you are buying a home and need an expert on your side.
The Pros and Cons of Dual Agency
Dual agency has some good and bad points for both buyers and sellers. It's important to look at both sides before you decide.
For the Home Seller
As a seller, here are the potential upsides and downsides for you.
Pros:
Simple Communication: Talking to just one agent can make scheduling things feel faster and more direct.
A Ready Buyer: The agent might bring a buyer straight to you, which could speed up the sale.
Cons:
Could Get a Lower Price: The agent cannot advise you to reject a low offer or push for a higher price.
Less Expert Advice: You lose a guide who is 100% on your team. When preparing your home for the market, you want someone focused only on your success.
For the Home Buyer
If you're the one buying the home, here's how dual agency could impact your journey.
Pros:
Direct Contact: You can talk directly to the agent who knows all the details about the house.
Convenience: The process might feel a little quicker at the start since one person handles everything.
Cons:
No Help on Price: The agent cannot help you decide on an offer price or negotiate for a better deal.
Split Loyalty: The agent’s payment is based on the final sale price, which doesn’t align with your goal of getting the lowest price.
Is Dual Agency Legal and What Are the Rules?
In places like British Columbia, it is legal, but it has very strict rules to protect people. Here is what you need to know:
The most important rule is "informed written consent." This means both the buyer and the seller must be told everything about the situation.
After the rules are explained, you have to sign a form saying you understand and agree to move forward with one agent.
When you sign this, you officially give up your right to have an agent who is working only for you and your best interests.
Are There Better Alternatives to Dual Agency?
Yes, there is a much safer and more common option called "designated agency." Here’s how it works:
Designated agency is when the buyer and seller each have their own separate agent, but both agents work for the same real estate company.
This way, you each get your own dedicated expert who has your back and is focused only on your needs.
Your agent can give you advice, help you negotiate, and keep your information private. This provides a clear and fair path for both the selling process and the buying journey.
Conclusion
So, we come back to our main question: can a realtor represent buyer and seller? Yes, but it is usually not a good idea for either person. The risk of not having a dedicated expert on your side is often much bigger than the benefit of convenience. You deserve an agent who is fully committed to helping you get the best possible outcome.