Buying Through the Listing Agent: Dispelling the Myths

In this era of readily-available information driven by technology, it’s easy for people to overlook the benefits of using a proper buyer agent when making an offer to purchase a property. It used to be that selling privately was the popular method of cutting costs and maintaining control, but more and more buyers are looking to go directly to the listing agent these days and eliminate the dedicated buyer agent.

The danger in creating an environment where the public believes that they are far more real estate savvy than they actually are, is very real. Admittedly, we haven’t done a very good job within the real estate industry of communicating our value to the public. 

On that note, let’s talk about some of the myths surrounding this issue.

Myth #1: By going direct to the listing agent, the buyer will win in multiple offers. 

The truth is, when bringing their own offers, the listing agent loses either way, unless they’re not playing by the rules. If their buyer wins the property, every other participant will cry foul. If they lose, the buyer client will feel like they were merely used to increase the selling price to the benefit of the seller and the agent.

Myth #2: The buyer will save money. 

Any savings resulting from double-ending will go to the seller, not you. The commission agreement is between the seller and the listing brokerage, so any savings is theoretically between those two parties.

Myth #3: The listing agent will be transparent about any issues or pitfalls about the property since it is their listing.  

The listing agent is only focused on selling you this house, and can’t mention any issues unless the seller gives them consent to communicate those to you. That’s not to say that the agent’s intention is to act in a devious or unethical manner, but their primary obligation is to their seller client.

Myth #4: The listing agent will be in a better position to negotiate with the seller than an outside agent. 

If anything, a seller will expect a bigger take if the listing agent isn’t doing their job to get the most exposure. No seller would be happy netting less than their expectations just to turnaround and give a discount to a random buyer.

Myth #5: The listing agent will tell me how much (or how little) I can get the house for. 

The listing agent cannot ethically divulge such details, and if they do, you can bet they’re telling your private information to the sellers too. Doesn’t sound like the person you want to work with!

Myth #6: I can find the perfect house by just going to open houses. 

The majority of properties available for sale are not always hosting open houses, so you’re limited to a fraction of the market. And you’re forced to work with an agent you know nothing about. A good buyer agent is previewing properties for you and giving you access to a wide range of homes so that you can make a confident, educated decision whether or not to buy.

Myth #7: The listing agent is obligated to protect my interests. 

The listing agent has a fiduciary duty to the seller – not to you. You will only get customer service; they will treat you fairly, follow your instructions, but will not be in a position to advise or consult you.

Myth #8: The listing agent can clearly represent both sides. 

There is no way to protect the interests of a buyer and the seller in the same transaction without a conflict of interest. And if you were the seller, would you be happy paying your agent so that they can be used by a prospective buyer to negotiate against you?

Most buyers have the best of intentions, but this is the largest financial and lifestyle decision of your life. Spend the time to interview a number of professional buyer agents to find out how their process works, ask about their track record, and see if you can create a good working relationship. You’ll be glad you did…