As Realtors (and team staff), we abide by a code of ethics to uphold professional standards and good relationships in our industry. Our actions are also governed by the agency agreements we sign with our clients. When a seller or buyer hires a Realtor, it is the Realtor’s job to put the client’s best interests first. This can lead to walking a very fine line between being cooperative with other real estate agents and brokers, and doing what is best for our client.
With that said, here is one of the biggest mistakes home buyers can make when viewing homes.
Disclaimer: This post is inspired by a discussion thread I recently saw in a real estate agent Facebook group. While our team has experienced similar situations, events outlined here are not our own. They do, however, provide a good lesson on what you shouldn’t do when house hunting.
New homes come on the market every day, but inventory is incredibly low so they’re also going under contract quickly. It’s important for buyers to schedule showings as soon as possible. Otherwise, they may miss out on “the one.” This makes buyers anxious, sometimes impatient, and even a little desperate to get someone to show them a home.
However, if you are a buyer who has already hired an agent, the biggest mistake you can make is calling the listing agent directly to schedule an appointment. On the surface, this may sound harmless. After all, it is the listing agent’s job to get the home sold and you are a buyer who may want to purchase it. But you must know that this can be a major disservice to YOU.
Why Would a Buyer Call the Listing Agent?
Sometimes, buyers hire an out-of-area agent to represent them, so rather than ask the agent to travel to show them houses, they request the listing agent to do it.
More frequently, though, buyers will call the listing agent when their Realtor is on vacation. They’re either not getting a quick response from their agent, or they don’t want to bother them, so they bypass them and go to the source.
In the case of the Facebook discussion, the buyers, a married couple, called the listing agent, because their agent was just getting home from a cruise and, for whatever reason, they didn’t feel the agent would get them in to see the house.
When they called, the listing agent did their due diligence and asked if they already had an agent. The buyers lied and said they didn’t. It wasn’t until the end of the showing that they mentioned they were already working with someone and would discuss an offer with that agent.
Why It’s Bad to Have the Listing Agent Show You the Home
As mentioned above, the listing agent has a written agreement with the homeowners to put their interests first when selling the property. This includes sharing all factual information that could affect the sale of their home.
Many states allow a listing agent to represent the buyer and seller. This comes with sacrifice from both sides of the transaction because the agent becomes more of a facilitator than a guide. Because the transaction can get messy under these circumstances, most listing agents will refer interested buyers to other agents on their team or in their company. This is best for the buyer and seller because it guarantees them the representation they deserve. It’s also best for the agent, because it protects them from unintended errors and omissions.
As for the agent in the Facebook discussion, they could legally represent both sides, but were planning to refer the buyers to another agent in their company once they gauged how ready they were to purchase. During the showing, the buyers openly discussed their feelings about the home in front of the listing agent. The wife was in love with the home, but the husband didn’t want to be part of a multiple-offer situation. When the listing agent asked if they would like to submit an offer, they revealed they were already working with someone else.
The buyers left and the listing agent received notice that another agent was submitting an offer for their clients. Then, the first buyers decided to submit an offer with their original agent. The listing agent presented both offers to the sellers, but because he was present during the first buyers’ showing, he had additional information outside of the offer that he was inclined to share due to his fiduciary duty.
He explained that the husband had reservations about the property and didn’t feel it was worth being part of a multiple-offer situation. Still, the listing agent recommended the seller notify both parties that there were multiple offers and ask if they would like to change anything in their terms before final consideration.
The sellers rejected the idea. The husband’s general attitude made them feel uneasy. So, they decided to accept the offer from the second buyers without a call for best offers. The first buyers were trying to get the upper hand by getting the listing agent to show them the home, but they inadvertently put themselves at a disadvantage.
Communicate with Your Realtor
Most Realtors have a plan for servicing their clients when they are unavailable. If they choose to go on vacation, they arrange for a team member or other agent in their brokerage to cover their showings. If you hire them to represent you in an out-of-area purchase and they are unable to attend, it’s their job to line up another agent to show you the home.
We have shown our own listings for buyer agents facing conflicts because they communicated with us. We made sure to give the buyers space to walk around and form their own opinion of the home, and the buyers saved all personal discussions for after the showing.
If your Realtor is planning to be out of town, make sure to ask what their plans are if you want to see a home. If you are unable to make contact with them while they are out of town, call their office or broker-in-charge. They can help make arrangements that will fit your needs. After all, the buyer agreement isn’t with just the agent, but the brokerage as well.
If you must reach out to the listing agent, be very upfront. Say, “I’m working with [agent name] at [brokerage] and I want to see this home, but they are unable to show it to me.” The listing agent can then take the steps necessary to make sure the code of ethics and written agreements are properly observed.