Is your real estate agent really on your side? If not, whose side are they on and how can that impact their ability to act in your best interests?
This debate triggers one of the most confusing parts of home buying, selling properties and investing in real estate for most consumers. While there is certainly lots of fine print following the smooth sales pitches, it is still not clear to most home buyers and sellers who a real estate agent really represents.
This causes all types of confusion, frustration and sometimes disappointment. Especially when buyers, sellers and investors find that their real estate agents are blatantly unwilling to negotiate the terms they want. Some real estate agents withhold offers from their clients or ask for strict conditions that might turn away potential homebuyers. Buyers may then be prompted to raise their offers, put down more deposit money and waive all types of important contingencies which are designed to protect them.
This bewilders the individuals that placed their their trust in these real estate agents to act on their behalf and breeds cynicism.
In fairness, some of this comes down to a lack of real estate education and understanding how the industry works. There are several different types of agencies real estate professionals act under. It is important to familiarize yourself with each of them.
This can differ according to the laws of different states, but there are generally 3 types of agencies:
Transactional or dual agency
Most big name real estate brokerage brands operate mainly as transactional agents. This means that they have no loyalty to either party. Seller’s agents are bound to protect their client’s interest and get the best possible deal out of any buyers that are shopping. A true buyer’s agent ought to be working exclusively for the buyer to get the terms they want and protect them throughout the transaction.
So make sure you know which type of agency your real estate agent is working under before you get in too deep. It is not too late to switch real estate agents if they do not have your best interest in mind.