An old co-worker of mine recently told me about their friends, who have been forever hunting the market for a new home. Their strategy is to contact the listing agent of a house they’re interested in, hoping that by working directly with the listing agent they will get a better deal on the house.
I’ve been trying to wrap my head around their logic. Perhaps they figure that by not working with a agent, they will pay less for the house because a second commission doesn’t have to be paid? Or do they think the listing agent will give them a competitive advantage in negotiating?
Sorry friends, I hate to break it to you but it doesn’t work this way. Here are a few things to consider:
1. If the listing agent represents both the buyer and the seller (called “double ending”), the agent takes 100% of the commission, instead of the usual 50/50 split between agents. And if there’s some sort of commission reduction, it would benefit the seller not the buyer…because the seller pays the commission.
2. It’s the listing agent’s fiduciary duty to market the house and get the most money possible. The agent’s duty and responsibility is to the seller.
3. If the listing agent represents both parties as clients, the agent must represent both parties equally. There must be complete impartiality and the agent cannot advise on price.
To summarize, there are no back room deals to be had or commissions reductions that benefit the buyer. In fact, there is only one reason I can think of where a buyer might want to deal directly with the listing agent…and it isn’t because they’re going to save money. It’s because they like the agent. Great agents are hard to find and a lot of deals are double ended because of this.
As a buyer, you’re not paying anything to work with me as your agent. And for this, I represent you and your best interests…before my own or the seller’s. I save you time. I advise you on the market, neighbourhoods, specific homes, investment potential, possible renovation and tradespeople. I learn about you and what you want, and I suggest options you may not have considered. I’ll tell you when I think you’re making a mistake and I protect you from the many pitfalls along the way. And I negotiate to get you the best deal. My 100% focus is you.