Dual Agency, Not In Anyone's Best Interest

It seems as though every time I post my professional opinion either in my own personal blog or in a public forum about how I feel about dual agency, a bunch of Realtors jump all over me because they just can't understand how a Realtor can have such an opinion.

The problem is that most Realtors do not actually understand what dual agency really is or the consequences thereof.

Dual agency is very complicated so it is easy to see how most Realtors wouldn't understand it however due to their lack of understanding, it hurts consumers.

I wanted to explain what dual agency is and why I do not practice it.

Dual agency occurs when a Realtor represents both parties. Further, since Realtors do not own their listings and the Broker does, the entire office then becomes a dual agent. So, are you confused yet? Obviously, you are not alone because most Realtors don't even understand.

I will try to break it down for you. Each real estate office must have a Broker of Record who is responsible for all of the agents. So, when one of the Broker's agent's takes a new listing, even though the agent met with the sellers and was hired by the sellers, it's actually the Broker of Record who owns that listing. Are you still with me?

Upon taking that listing, the entire office in effect becomes a dual agent. A dual agent in name only. Think of it as an umbrella. Some Realtors will argue that what one Realtor knows in the office every Realtor knows in the office. Meaning that the agent who took the listing came back and shared all of the seller's personal and confidential information with every single agent in the office. Not only is that not true but if it were true, that would be unethical on the listing agent's part because they have a fiduciary duty to their seller to keep the seller's information confidential. And in an office where there are 200 plus agents that would just be silly to think. How am I doing?

So, yes in theory and in name only, every single agent in that office is deemed a "dual agent" because the Broker of Record owns every single listing in the office. So, if a buyer wants to purchase a listing that belongs to their buyer agent's office, the agent's must disclose that dual agency exists within the entire office but neither agent is personally acting as a dual agent.

Are you dizzy yet?

Real dual agency occurs when a Realtor is hired by a seller to sell their home and then secures a buyer who wants to buy that seller's home and wants the Realtor who took the listing to also represent the buyer at the same time. At that point, the Realtor is working both sides of the table and now can no longer negotiate for either side but instead acts as a mediator. Dual agency.

In my professional opinion, dual agency is not in anyone's best interest, not even the Realtor. The seller doesn't have fair representation anymore even though when the listing agent was hired, promised to get the seller the highest price the market would allow and vowed to protect their best interest but as soon as a buyer comes along, the agent just throws all of that out the window and wants to represent a buyer who never wants to pay the highest price for the home.

Years ago, buyers didn't have the right to representation, only the seller was represented. The playing field was not level. Now, the field is level. Both sides can have equal representation.

I do not see any good in dual agency. I feel that nobody wins when both sides are represented by the same Realtor as someone usually gets hurt. I will certainly not promote it and will stand up against it when the need arises.

Consumers are always concerned about their rights and I write this blog to make consumers aware that they do have rights. They have the right to be represented by their own Realtor. They have the right to have someone look out for their best interests. But most importantly, they have the right, finally, so why not use that right?

Realtors are supposed to put their client's best interest first all of the time. By participating in dual agency, I feel that neither client's interests are put first. The agent basically sits on the fence and is neutral. How does that help anyone when the Realtor basically sits on the fence and says to the seller, "the buyer wants to offer you this, do you want it?" And then goes back to the buyer and says "the seller says no, are you good with that?" The Realtor is just acting as a paper pusher. The best quality a Realtor is supposed to have is their negotiating skills. Take negotiating out of the equation and then what good is the Realtor? I suppose dual agency is the way to go for those Realtors who are just not comfortable with the negotiating process.

Keep in mind that when a Realtor enters into a dual agency relationship, the Realtor keeps the entire commission which leads many to believe that is the sole incentive for a Realtor wanting to partake in dual agency because it can cloud the Realtor's judgment.

In closing, I say to all buyers and sellers, if you want the best deal, hire your own Realtor and stay away from dual agency.