Should You Use the Listing Agent to Buy a House

As we work with people moving up and finding the perfect home for their current life stage, we hear many questions from our clients. One of the most common questions that have been more prevalent since 2020 is “Should I use the same agent as the seller?”.

We invited one of our team members, Ari Shams, to talk about the real deal in working with a listing agent when buying your next house.

The Difference between Listing Agent & Buying Agent

Any realtor can be a listing agent or a buying agent. They can both list a house and help people buy a home. But in a transaction, the listing agent exclusively works for the seller, and the buying agent exclusively works for the buyer.

If you want to work with the seller's agent, you’re trying to ask that agent to work for both buyer and seller. But you have to set your expectations properly if you want to do that.

Buyers Thinking of Getting a Better Price

In most cases, the buyer thinks they will get a better price if they work with the listing agent. But that is not always the case. There are many circumstances and variables that come with the listing price.

Generally, the listing agent has a fiduciary duty to the seller. They have a contract in place, and they already negotiated commissions. If the conditions change, the seller is the one saving more money and not the buyer more often than not. Because even if the buyer pays a lower amount upfront, it will affect their mortgage.

Off-Market Inventory

A lot of buyers think that selling agents have a lot of secret off-market inventory. To put things in perspective, an average agent in Calgary can sell 6-12 houses a year. If they can sell one house a month, their pool of off-market properties will not be that big.

You also have to keep in mind that buying off-market inventory is not as advantageous as it may sound. Having a realtor to look out for your best interest is always the best way to go.

Think about it this way, if you're being sued for $400,000, do you want to represent yourself, or do you want to bring a lawyer to protect you? Buying a house is one of the biggest investments people make, so leaving it up to chance is not good.

In our brokerage, we have 15 agents, and we only know a handful of people who say their house is ready for sale if the right person comes along. In reality, this secret off-market inventory is not as big as some buyers think.

Winning Multiple Offers

Many buyers who go to the selling agent directly believe it might help them in winning multiple offers. That is not true because of the listing agent’s duty to the seller.

In a multiple offer scenario, the listing agent is responsible for identifying the best and most beneficial offer for the seller. Even if a buyer works with the listing agent, there’s no guarantee that their offer will win, especially if bigger and better offers are in place.

In that case, going to the listing agent actually hinders the buyer from having a realtor to advise the best way forward. Some brokerages do not allow agents to take a double-dip or work with both parties in a single transaction. It’s good to check the policies of the brokerage you are working with.

Getting Inside Scoop on the Selling Price

Sometimes, the buyers think they will get an inside scoop on how much they should pay for the house when they work with the listing agent, but that is not true. And if that happens, that will be a breach of the fiduciary duties of the listing agent.

It will be tough for the agent to provide sound advice if they are working with both the seller and the buyer. They will end up being the middle person telling information from one party to another instead of helping the client to have the best strategy to move forward.

The seller also needs to give consent to the listing agent to represent both sides. If the seller refuses, then the agent can’t represent the buyer. That's where the agent’s broker steps in to provide another realtor to be a part of the transaction.

All in all, going directly to the listing agent of the house you like is not as good as it seems. The agent may know the house a little bit better, but they are tied to their duties to the seller.

Find the Best House

We have curated a list of the seven biggest mistakes that clients can make when hiring realtors. Download it for FREE so that you can avoid these mistakes on your next real estate transaction.

Remember, the listing agent’s goal in the transaction is not to help you find the perfect house but to sell you this house. They might not put in the effort to build a relationship with you, understand your real estate needs, and just settle with selling their listing. It is all about the transaction. You will miss out on a huge opportunity of having someone work for you if that happens.

If you have any questions or want to discuss this with Ari Shams, you can reach out to him at 403-400-6269. You can also email us at info@chamberlaingroup.ca for any of your real estate needs.