When it comes to real estate transactions, the typical arrangement involves one agent representing the seller and another representing the buyer. However, there are instances where the same agent represents both parties in a transaction. This is known as “double ending” or “dual agency.”
In the first scenario, both the buyer and seller each have their own separate agents who happen to work for the same broker. This is called dual agency and is allowed in many cases without any complications. In this situation, the fiduciary duty of both agents increases, which can actually be beneficial for both parties.
The second scenario refers to a situation where the same agent represents both the buyer and the seller. This is also considered dual agency but is additionally referred to as “double ending.” In this case, the listing agent is responsible for representing all the interests, negotiations, contracts, and disclosures for both parties. The agent essentially gets paid for managing both the buying and selling sides of the transaction.
While double ending can have its advantages, such as in cases where a house has been on the market for a long time and the listing agent has done a great job promoting it, there are also disadvantages. Real estate agents have a fiduciary duty to their clients, with a buyer’s agent aiming to get the lowest possible price for their client and a seller’s agent seeking to maximize their client’s profits. When the agent represents both parties, it becomes challenging to navigate these conflicting interests.
Some buyers may want to have the listing agent represent them in a transaction because they believe it gives them an advantage. However, this can sometimes be a tactic used by listing agents to earn higher commissions. They may entice buyers by suggesting they have a better chance in a multiple-offer situation and could potentially receive a credit back from the listing agent. In reality, the interests of the buyer may not be truly protected as the listing agent may prioritize getting the transaction closed instead of advocating for the buyer’s best interests.
It is important to note that while dual agency is legal, sellers should always be consulted and provide approval. Not all agents engage in double ending, and most only do so with the full approval and understanding of their clients.
If you are thinking about selling and are considering double ending, it is recommended to have an open and honest discussion with your agent. Together, you can weigh the pros and cons and make an informed decision.
In conclusion, double ending or dual agency can occur in real estate transactions when the same agent represents both the buyer and seller. While there can be advantages and disadvantages to this arrangement, it is crucial for both parties to be fully informed and for sellers to provide their consent. Transparency and open communication with your agent are key to ensuring a successful transaction.