What’s the difference between a listing agent and a buyer’s agent?
The real estate jargon can be confusing, especially if it’s your first time selling a home.
Equipping yourself with the necessary knowledge and information will help you select an ideal real estate agent to represent your interests. (And yes, even the most well-informed sellers are sometimes thrown off by the real estate jargon!)
Let’s clear the air with some of the most commonly used terms in real estate:
Buyer’s Agent vs Listing Agent
Selling a house is no easy feat. It can involve several stages such as renovating, staging, listing, marketing, and finally closing the deal. For homeowners, it’s also an emotional time since they have many memories attached to the place they’ve called home.
So they hire a listing agent with expertise in accurately pricing, promoting, and selling their property. This pro also manages all the paperwork, negotiations, and legalities throughout the process.
On the other hand, finding your next place also can feel overwhelming.
That’s why buyers also hire an agent, called the buyer’s agent, who assists them in securing their new home.
So…What’s the Confusion?
If you’re planning to sell your home, you go to a listing agent and if you’re planning to buy one – you go to a buyer’s agent.
Sounds simple, doesn’t it?
But bring more jargon into the mix and this is where it gets confusing. You may sometimes come across other real estate terms, such as “selling agent.” Judging by the word “selling,” most people consider it a synonym for “listing agent.” However, that’s not true.
Here’s the deal: Before signing the formal agreement, a buyer’s agent (representing the buyers, of course) is referred to as, well, a buyer’s agent. Fair enough. But after the contract is executed, i.e., the home is sold, the buyer’s agent is also known as the “selling agent.”
It’s because they effectively closed the deal and sold the home. Hence, from the perspective of that buyer, the buyer’s agent is also the selling agent.
Long story short: Seller’s agent = listing agent; Selling agent = buyer’s agent. (No, there will not be a quiz at the end of this article…but you still might want to take notes!)
Can Real Estate Agents Represent Both Sellers and Buyers?
The term ‘real estate agent’ is a broad term that comprises both listing agents and buyer’s agents. However, a real estate agent can be both a listing agent and a buyer’s agent. If your agent is representing you (a seller) as well as a buyer, then they are essentially a “transaction broker.”
It means they are not technically representing either of you, but only servicing the transaction. Note that this is not legal in all 50 U.S. states. And where it is indeed legal, the agent is required to obtain each party’s consent in the dual agency situation.
Are there any benefits to opting for a transactional broker?
Yes! You can save money by hiring a transactional broker as each side pays less in fees. However, the potential downside is a big one: it’s very difficult for humans to be 100% neutral in a given situation and there’s more than a chance that without someone exclusively on your side, your deal may go in favor of the opposing party.
In a Nutshell
Understanding these differences will help you call the right agent when it comes time to sell. Moreover, by familiarizing yourself with these terms, you’ll feel more confident throughout the process.
Just remember: a seller is represented by a listing agent or seller’s agent. On the other hand, a buyer is represented by a buyer’s agent or the selling agent. (If you rolled your eyes a bit at this second reference, well done on remembering these terms!)