Real Estate 101: Understanding Types of Agency

Posted by Susan Zanzonico on Saturday, August 21st, 2010 at 10:58am.

When it comes to the world of real estate, many people assume that the primary role of the real estate agent is to sell homes. While this is a large portion of many agents’ careers, the reality is that there are three different types of agency that a real estate agent may represent. Therefore, it is important for anyone who works with a real estate agent to understand these three types of agency and how they might affect the way the agent handles the entire transaction,

Real Estate Agent as Seller’s Agent Also referred to as the listing agent, the seller’s agent is responsible for representing the person who is selling the home. While the seller’s agent may assist the buyer with finding a home, he or she is ultimately responsible for representing the interests of the seller. This means that, when it comes to negotiating the price or any other details of the contract, the seller’s agent will try to get the best deal for the seller. Although this doesn’t mean the agent will be deceitful, it does mean the buyer should refrain from sharing anything with the agent that he or she wouldn’t want to be shared with the seller.

Real Estate Agent as Buyer’s Agent On the other side of the spectrum, a real estate agent may work as a buyer’s agent. As the name suggests, the buyer’s agent works on behalf of the person who is purchasing the home. Although the buyer’s agent may assist the person who is selling the home, his or her primary responsibility lies with representing the buyer. Just as the buyer shouldn’t disclose certain information to the seller’s agent, the seller should avoid sharing pertinent information with the buyer’s agent unless otherwise required by law.

Real Estate Agent as Dual Agency Sometimes referred to as an intermediary agent, the dual agency real estate agent serves as an intermediary for both the buyer and the seller. In this case, the dual agency agent must obtain written consent from the buyer as well as the seller as well as a contract outlining the agent’s obligations as the intermediary. When working as the intermediary, the agent must abide by the guidelines that have been established by the State. These include: Treating all parties honestly

Must not tell the buyer that the seller will accept a lower price unless the seller provides written consent
Must not tell the seller that the buyer will pay a higher price unless the buyer provides written consent
Must not provide information to either party if instructed in writing not to do so, unless written authorization is provided later, the agent is required to disclose the information

About the Author: Eric Bramlett is the broker & co-owner of One Source Realty, a boutique Austin real estate brokerage. Eric currently manages his agents, and works with select buyers & sellers. Eric manages a Austin condo website, and specializes in Steiner Ranch Homes for Sale. Eric has worked in central & west Austin for 7+ years, and is considered an expert in online marketing.