Can A Real Estate Agent Work For Both The Buyer AND The Seller?

From The Blog

7 November 2016


A local real estate agent has a new listing that is perfect for you.  Can he effectively help you buy that house AND help his clients sell it?  The answer is yes, but you should be educated about the process.  The situation I just described is called Multiple Representation or Dual Agency and in the words of the Real Estate Council of Ontario, “occurs when two or more parties are represented as clients by the same brokerage.  This could happen with each party having a different representative of the same brokerage, or a single representative working with two or more parties”.  Most often dual agency happens when a buyer and seller are using the same agent and in that case, both parties are required to acknowledge and consent to the situation by signing a form called a Dual Agency Agreement.

What does this mean for you, the client?  Before entering into a multiple representation or signing a Dual Agency Agreement, clients must be informed if/when the situation arises, that their written consent is required and must be provided with a clear description of the services and levels of service that the brokerage/agent would provide.  As soon as the Multiple Representation is confirmed and BEFORE ANY OFFER TO PURCHASE IS MADE, the brokerage/agent must disclose to both parties:

  1. That they intend to represent two clients
  2. An explanation of how the obligation to promote and protect each client’s interests will differ, essentially outlining any differences in service (for both the buyer and seller) that could arise as a result of working on behalf of both parties

Remember, regardless of the situation, the brokerage must always deal with you fairly, honestly and with integrity, and provide you with conscientious and competent service.

As with most situations in life, there are both pros and cons to multiple representation.  Naturally, the buyer and seller have different objectives. A seller wants to get the highest sale price possible while the buyer wants a bargain.  This can sometimes create I difficult situation as an agent/brokerage has a duty to work towards accomplishing both of these objectives at the same time.  The silver lining is that if an agent is representing both the buyer and seller of one transaction who are very close but can’t quite agree on price, it is occasionally possible for the agent to agree to reduce his/her total commission in order to facilitate an agreement.

Buyers sometimes reveal confidential information to their agent, which could potentially reduce their bargaining power. This is why it is key to establish a good relationship with your agent and to work with someone you trust.  Most agents are just like you, they work hard to earn a living and would never knowingly put their clients in a position which could be less than beneficial.  Do your due diligence and make sure you feel comfortable with your agent before pursuing any property.  On the positive side, there are often administrative elements to the transaction that are streamlined when both parties are dealing with one agent/brokerage.  Paperwork, communication and the logistics associated with a transaction can be a stressful element all on their own.  This stress can often be reduced or avoided when there are fewer parties involved.

There is one important thing you should keep in mind before agreeing to multiple representation.  You have a choice.  If you’re not comfortable with dual agency, say so.  You have the right to disagree if you feel the situation does not fully support your needs.  The good news is that if you do decide to find a different representative, there are many reputable brokerages and agents to choose from and the agent you initially made contact with can probably even refer you to someone.


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