Should I go directly to the listing agent when buying a house?

For some reason, buyers of real estate think they are getting an advantage by going directly to the listing agent to buy a house. I am going to explore why buyers might feel this way and then I will go on to say that it does not matter if you choose the listing agent or a selling agent to help you buy the house.

Lots of people like to find the listing agent of the property because they feel they are going straight to the source to buy the house. When this happens, the listing agent will become a dual agent to both the buyer and seller, both of whom must consent to the dual agency via a disclosure of agency relationship. My opinion about dual agencies is incidental to the main point of this article, but what I can say about dual agency is that it is ethically permissible.

Dual agencies are ethically permissible because the agent works in a way that helps both parties and does not reveal the “weaknesses” of either party and maintains confidentiality throughout all her actions. Many of my colleagues might have different opinions about this, but what I can say is that most agents find the dual agency morally permissible (its legality is obvious and nobody is trying to overturn its legality).

So if the buyer goes directly to the listing agent, a dual agency will be created. Buyers think that going to the listing agent will give them a distinct advantage over other offers. This is not necessarily the case. When the listing agent presents all offers to the seller, the seller will not choose an offer simply because the listing agent is representing the buyer. The seller will choose the highest and best offer—highest in terms of price, and best offer in terms of the terms and details of the offer that determine the costs divided to the parties.

So if the seller chooses the highest and best offer, it’s not the case that going to the listing agent will get you the house, especially if your offer is not higher than the rest.

Another reason buyers might want to go to the listing agent is so that they think they can close faster because all the files are being worked on internally. Again, this is not necessarily true. While I have been a dual agent before and it is convenient to have all the files in one place for myself, that is merely a convenience to myself, the professional Realtor, and not necessarily a benefit passed on to the buyer. How fast the transaction closes is determined by the terms of the contract and the loan of the buyer. If the buyer’s loan needs time to qualify and fund, then the closing is determined by that, and not by the fact that the listing agent is representing the buyer.

Recall now the original purpose of putting a listing on the MLS: sellers do this to get the exposure, with each MLS board providing at least 20,000 members who are Realtors. Chances are that the listing agent will not be the one to sell the property.

What the consumer should be aware of is that the listing agent does represent the seller, but the listing agent may not necessarily be the best person for the job. Good buyers should get a strong feel for the Realtor by meeting them face to face and having frequent phone conversations with them in order to see if there is compatibility. Imagine automatically choosing the listing agent only because they represent the seller in the house they are selling but they are incompetent. As a buyer, you will feel neglected, trapped, and worst of all, there might be miscommunications that could cost you money.

I’m not saying that always selecting a buyer’s agent will save you from agent blunders; what I am saying is that choosing a Realtor is like interviewing a series of professionals to make sure you are represented properly. By automatically defecting to the listing agent, you completely skip over the interviewing process which is essential to your own self-regulating consumer protection protocol. You wouldn’t operate heavy machinery without reading the manual, right? So too would you not select your Realtor without learning more about the Realtor and determining whether they are right for you.