Should You Buy With the Listing Agent

When you're in the real estate market to purchase a new home, you may have some questions about the role of the listing agent. Particularly in British Columbia, there are some unique considerations that buyers and sellers should consider regarding working with a listing agent. It seems intuitive to consider working with them - after all, they are showing you the property, so it can be tempting to try and work with them directly to cut out another middleman. But is it a good idea to buy with the listing agent, or is it better to have your own dedicated buyer's agent? Today, we will explore exactly that.

How a Real Estate Transaction Works

Before determining whether or not to work with the listing agent, it’s important first to understand how a real estate transaction works. In BC, there are typically two or more agents involved in a residential real estate sale. When homeowners decide to sell their property, they usually hire a dedicated listing agent to help them market the property and negotiate the sale. The listing agent's job is to use their extensive resources to effectively market the property and answer any questions related to the listing.

On the other side of the transaction is the buyer's agent, who represents the buyer's interests and helps them find the right home. The buyer’s agent can help with searching, setting up showings, asking the right questions and negotiating on the buyer’s behalf. 

Banning Dual Agency in BC 

In British Columbia, Canada, limited dual agency in real estate transactions has been banned as of June 15, 2018. This means that a real estate agent can no longer represent both the buyer and seller in the same transaction, except in certain specific situations where both parties provide informed consent.

The Real Estate Council of British Columbia (RECBC) implemented the ban on limited dual agency to address concerns around conflicts of interest and to better protect consumers. Under the new rules, real estate agents can no longer act for both the buyer and seller in the same transaction, even if both parties have agreed to it.

Instead, real estate agents in British Columbia must now work in a designated agency model, where they represent either the buyer or the seller, but not both. This is intended to ensure that the agent is fully committed to their client's best interests and has no conflicts of interest.

Under the new rules, real estate agents are required to disclose to their clients the extent of their services, the fees they charge, and any conflicts of interest that may arise during the transaction. This is designed to ensure that clients are fully informed and able to make decisions based on all relevant information.

While the ban on limited dual agency in British Columbia has been controversial, it is part of a broader trend in real estate towards more transparent and ethical practices. Particularly in smaller towns, the BC Real Estate Association argued that limited dual agency is crucial due to the lack of agents. On the other hand, requiring agents to work in a designated agency model brings hope that consumers will be better protected and that real estate transactions will be more transparent and fair for all parties involved.

Overall, the ban on limited dual agency in British Columbia is an important development in the real estate industry and underscores the significance of transparency and ethical conduct in all real estate transactions.

Should I Still Work with a Listing Agent? 

There is one exception to the dual agency ban in BC, but it is very limited in scope. On an approval basis (i.e. the agent must present their case to the RECBC), agents can act with dual agency if:

• The property is located in a remote area
• The area is proven to be under-served and lacks real estate professionals
• There is proof that it is impracticable for the parties to find separate agents.

If that situation arises, then you may be able to work with the Listing Agent. 

The Dangers of Buying With The Listing Agent

Ultimately, the listing agent is obligated to disclose to you that they will be putting their client’s interests first and do not have any loyalty or obligation to act in your interests. The listing agent is working for the seller, and their job is to get the best possible price for the property. Therefore, the same agent can't also prioritize the buyer's best interest. You may not get the best deal if you try to negotiate directly with the listing agent. As such, it is highly unusual that you will have a better experience choosing a listing agent.

Alternatives to Working with the Listing Agent

So, now that we’ve established that working with the listing agent is mostly impractical in British Columbia, what are your other options?

Representing Yourself

One alternative to working with the listing agent is representing yourself in the transaction. If you're considering representing yourself, it's essential to do your research and be prepared to do the work required. You'll need to be familiar with the local real estate market, including property values, trends, and legal requirements. You'll also need to be able to negotiate with the seller's agent and navigate the legal and financial aspects of the transaction.

While this approach may seem appealing, it's important to understand the risks and challenges involved. Real estate transactions are complex and involve legal contracts and negotiations, and without a professional to guide you, you may be at a disadvantage. Additionally, without an agent to represent your interests, you may not have access to the same resources and tools that agents have, such as market analysis, property search engines, and professional networks. 

Finding a Buyer’s Agent

Another alternative to working with the listing agent is to hire your own buyer's agent. Buyer agents are licensed real estate professional who represents your interests in the transaction. They can help you find the right property, negotiate the best deal, and guide you through the entire home-buying process. A good buyer's agent will have your best interests in mind, and they will work hard to get you the best possible price and terms for the property.

To find a suitable buyer's agent, you can start by asking friends and family for recommendations or searching online for agents in your area. Look for someone who is experienced, knowledgeable about the local market, and has a track record of success. When you meet with potential agents, ask about their commission fees, availability, and approach to representing buyers.

If you have any questions about buyers' agents, consider connecting with our team. Loyal Home’s Client Care Coordinators can provide accurate and up-to-date information to help support you through any buying process. We can also connect you with local, on-the-ground agents who can negotiate on your behalf and support the completion of your real estate transaction. Please let us know if you have any questions! 

An important question to ask when selecting an agent is their experience. Some real estate teams have designated agents who specialize in either selling or buying. This allows clients to work with an agent who has expertise in their specific needs and who can provide useful representation.

Once you've found an agent you're comfortable with, it's important to establish clear communication and trust. Be upfront about your budget, preferences, and timeline, and be willing to listen to their advice and guidance. Remember that the buyer's agent works for you, and their goal is to help you find the right home and make the best possible deal. If you're considering buying a home, it's essential to weigh the pros and cons of working with the listing agent and ensure you have a clear understanding of the agent's obligations and the risks of dual agency.

Conclusion

In conclusion, buying with the listing agent is an unlikely experience for a British Columbian buyer in 2023. We touched on the limited situations where it can still occur, where it's essential to weigh your options carefully before making a decision. If you have a good understanding of the real estate market and negotiation skills, representing yourself may be a good option. However, hiring a buyer's agent may be the best choice if you're new to the process or need a professional to represent your interests. 

No matter which option you choose, it's important to be informed, do your research, and work with a professional you trust. A successful real estate transaction requires careful planning, communication, and collaboration, and with the right team in place, you can find the home of your dreams and make a deal that works for you. Contact our team today for any questions about the process!