Sound Off: Can a Realtor represent both buyer, seller?

A: Buyers often think that having a listing agent write an offer will get them a competitive advantage with the seller, and allow them to get the property at a discount, given that the seller’s total commission due to the agent might be less if the agent represents both sides.

What generally happens, however, is that sellers feel uncomfortable having the listing agent act as a “dual agent” and are concerned they aren’t getting as high a price.

The possible discount on the commission — if there is one — would be factored into the purchase price by the sellers.

But they will also consider the fact they might not be getting the highest price possible. The buyers end up forgoing robust representation by an agent who negotiates solely for them.

Thus, we generally advise buyers retain their own representation by a buyer’s agent when submitting an offer in a competitive situation.

Vanessa Kitchen, Pacific Union Real Estate,

415-447-6258, vanessa.kitchen@pacunion.com. A: There are certain times when using the listing agent to represent both the buyer and seller may be beneficial. When it’s a “contractors special or fixer” or the home has been on the market for a while, you can gain an advantage in getting the property because both sides are motivated to get the deal done.

However, our market’s lack of inventory has been a problem, so the listing agent should be working for the seller — if they represent both they have a fundamental conflict. When you represent both sides you need to act as a neutral third party between the two sides to the transaction.

If both parties agree to terms and act in good faith this can work well. If something goes wrong it’s much harder to be in the middle of two parties that can’t agree. You might think that you gain an advantage having the selling agent represent you as a buyer, but understand that the relationship began with the seller. Put simply, in our market of multiple offers, you want your own representation.

Matt Heafey, the Grubb Co., 510-541-1754, heafey@grubbco.com. A: Representing both buyer and seller in a real estate transaction in California is entirely legal, and indeed common. But the potential for a conflict of interest lurks.

Honestly, it’s nearly impossible to serve two masters simultaneously

When representing the seller, the goal is to achieve the highest and best result. When representing the buyer, the goal is to obtain the property for a little as possible. Therein lies the inherent struggle and conflict.

Moreover, listing agents who suggest that a buyer “has a better shot if they write with them” are usually putting their own interests and pocketbook ahead of their sellers, which is why it’s always wiser to refer out unrepresented buyers to another Realtor, ensuring that each side has their own advocate and representation.

Julie Gardner, McGuire Real Estate,

510-326-0840, julie@juliegardner.com.