Agents for both the buyer and the seller are commonplace in real estate deals. However, there are certain instances of real estate agents serving as a dual agency. There are situations where a real estate agent can serve as both a seller’s and buyer’s agent.
Property buyers often have issues to locate buyers agency queensland to handle the buying property process, due to lack of trust and doubts, such as – will he/she be working in my favour or against me?
Should you team up with a dual agent? Let’s analyze the benefits and drawbacks in further detail.
How Does Dual Agency Work?
When a real estate agent represents both the buyer and the seller in a transaction, this is known as a “dual agency.” Instead of having one agent negotiate on behalf of both parties in a real estate transaction, it is more customary for each side to have its own agent.
When you find yourself falling in love with a home that your real estate agent also happens to be selling, it is possible to work with a dual agent. But if the thought of working with someone who represents both the seller and the buyer makes you uneasy, you are under no obligation to do so. Keep in mind that dual agency is prohibited by law in some jurisdictions.
Who Gains in Dual Agency?
If you’re a property buyer, the convenience of a dual agent setup can appeal to you. Potentially lessening the burden of paperwork and facilitating better communication between the buyer and seller when there is only one agent engaged.
While the buyer does stand to gain from this arrangement, the dual agent stands to gain the most.
The dual agent’s goal is to find a compromise that benefits both parties. However, as a dual agent, they have an additional incentive to rush through the deal without giving much thought to the finer points of the negotiations.
They stand to gain from commissions from both the buyer and seller. Therefore, completing the transaction at or near the asking price is in their best interest. Both the buyer and the seller may end up paying more in commissions than they should because of the real estate agent’s inability to fulfill their fiduciary duties to them individually.
The Downsides of Dual Agency
There are several drawbacks to a dual agency setup that you should know about. The following are examples of these:
- There is a potential conflict of interest between the agent and the buyer if the agent’s commission is tied to the final sales price.
- Although both the agent and the seller desire to maximize profit, the agent may feel pressured to expedite the sale at the expense of a higher price.
- There can be no impartial counsel given by a dual agent to either of the parties they represent.
- As the agent’s workload rises, his or her availability decreases. Buyers and sellers must compete for the time of a dual agent, who must handle twice as much business as an exclusive agent.
- There are use cases when the disadvantages are acceptable. It’s not a good idea to force yourself into an uncomfortable situation.
Are Dual Agencies Illegal?
Despite your desire to collaborate with a double agent, doing so may be illegal in your state. The states of Alaska, Colorado, Florida, Kansas, Maryland, Wyoming, Texas, and Vermont all have explicit bans on the practice.
In most jurisdictions, dual agents are permitted to do business. However, they are often subject to certain limitations. If the issue of dual agency arises, the agent cannot proceed without the buyers’ and sellers’ express written consent. If your Brisbane buyers agent is a dual agent, he cannot represent both parties without the express written permission of both.
Dual Agency Vs. Designated Agency
A dual agent is one who represents both the buyer and the seller in a same transaction.
Dual agents are frequently confused with designated agents. Designated agents, like buyers agents in Queensland on the other hand, are not working together as a dual agent would. Both agents must be licensed real estate brokers, however, they need not operate for the same firm.
When you have a designated agent, you can feel assured that they are looking out for your best interests. Many buyers then, prefer to use a buyers agent to guarantee that their realtor is acting in their best interests.
Should you Hire a Dual Agency?
By having two agents work for both the buyer and the seller, the home-selling process can go more smoothly for everyone involved. You shouldn’t enter into this contract without careful consideration. Considering the dual agent’s potential effects on your decision is highly recommended.
Instances when avoiding dual agency is problematic include:
- Multiple agents from the same firm often cover the same geographic area.
- Few agents operate in a concentrated region.
It is also possible for a dual agency to occur without the buyer’s knowledge in situations such as:
When built from the ground up: New home buyers who go to the sales office meet with agents who work for the seller (the builder). To the untrained eye, this connection may not be immediately apparent. When purchasing new construction, savvy buyers will work with a single agent to protect their interests, but many purchasers are unaware that this is an option.
An open house: A listing agent holding an open house for an investment property is likely working on behalf of the property’s seller. There will also be a sign-in page for potential homebuyers to provide their contact information on. One interested buyer may be swayed to employ the selling agent just because they hit it off with them at the open house and want to buy the property.
Online listing: One day, when house-hunting online, you come upon a place that piques your attention. A buyers agent’s contact details are included in the listing. You may be in a dual agency position if you contact them directly rather than using your own agent (one who works for a different organization).
Conclusion
Although there is nothing improper about using a dual agent (in jurisdictions where it is legal), verifying that your real estate agent is serving your best interests might be difficult. Having your own agent to look out for your interests could save you a lot of hassle.
Be sure to give working with a dual agent careful consideration before agreeing to do so. Start applying for a mortgage when you’ve found a reliable real estate agent and are ready to begin house hunting. This way, you can make an offer on the house of your dreams as soon as you locate it.
For property buyers to know the best timing for the right property in the Brisbane property market, and when to take the best opportunity in property purchase, our buyer’s agent recommends that you follow the right buying process for your particular property. Contact the best buyers agents Queensland for the best results.
At buyers agency Queensland, we always have the interest of our clients at the centre of our operations. Working with our experts Brisbane Buyer’s Agents, you can be rest assured you are getting the right property.