Empowering the Buyer Consumer – Redfin

You’ve got to get MAD! You have to say, “I’m a human being, God Dammit, my life has value!

I wish I could take that stupid smile off of my face on my “permanent” photo on the right.  Just for this post.  Then I can go back to being the perenially smiling postage stamp.  But not today, not for this article.

I realized when Noah of Urban Digs commented this morning, that when I said I don’t read NYC blogs, his and Curbed and Christine’s, it’s not because they are about NYC.  I read many other blogs that are about their local environs.  It’s because “I’m as mad as hell” at NYC for not having Buyer Agency.

Truth is I’ve been mad since August 20th, 2006, when Christine commented to this post, comment #28 “A month a go or so, there was a debate that went from this blog to just about every blog from here to kingdom come, regarding “Buyer Agency

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ARDELL is a Managing Broker with Better Properties METRO King County. ARDELL was named one of the Most Influential Real Estate Bloggers in the U.S. by Inman News and has 33+ years experience in Real Estate up and down both Coasts, representing both buyers and sellers of homes in Seattle and on The Eastside. email: ardelld@gmail.com cell: 206-910-1000

164 thoughts on “Empowering the Buyer Consumer – Redfin

  1. OK. Let me just speak my peace on this issue because it is one that MOST BUYERS do not fully understand!

    First off, YES, most sellers price the commission into their asking price. This is not rocket science and as pissed as you may get as a buyer to hear this, trust me, when you go and sell you will do the same thing. We are human, and as such animals we are greedy and full of emotion.

    Second, I completely wholeheartidly and with every ounce of emotion I have DISAGREE WITH THE STATEMENT…”I am a broker here in NYC and we don’t act in buyer agency. We are all one in the same – we represent the seller. Period. “..I’ve had this discussion with another broker in my office and stand by my thoughts.


    This is how I do business. I provide a great service to my clients and work my a$$ off for them. I should get testimonials up to prove this but I like to keep UrbanDigs out of my personal business and let people decide for themselves to work with me. Im not a car salesman. I became a real estate agent because I was MAD AS HELL that I couldnt find someone with experience and knowledge to represent me. I had to learn for myself. Thats why I do my business this way.

    If you want to twist it and say I work for the seller because I get paid by the seller, FINE, but ask my clients whether they think I worked for them and in their best interests. I always do!

    Now, here is the problem. YES, most exclusive agreements for sellers have a trickle down commission structure; say 6% co-broke and 5% direct. There is NO problem with this as most sellers realize the most important fundamental to real estate: THAT BUYERS DICTATE MARKET PRICE, NOT BROKERS!

    Offering 6% to the brokerage community flat out gets you the most traffic and interest. There is no debating this. YES, a buyer could possibly save money by going direct with the seller broker, but WHY? They are not being represented. They are not being guided by a third party. Rather they are being treated as a BONUS for the seller broker who if gets a deal done will get a higher commission split!

    If I was a buyer I would at least realize that I should be represented by someone with experience and knowledge about the hundreds of thousands of dollars Im about to plunk down, and not by someone hired to sell a certain property! GET IT! If its not written in books than its a matter of ethics and you need to decide for yourself what the right thing to do is.

    Buyers, trust me, get a broker to represent you and do your research to find one that is educated, ethical, and patient! You dont want someone who needs a check next month! Be smart! You’ll end up making a much better investment if you do this!

  2. > And then we have Greg, and his Smackdown with Jeff and Russ, saying that WE look like aliens to NYC, as if WE who treat buyers as clients, have six toes on each foot when we take off our socks.

    I said nothing of the sort, Ardell. Honest bloggers quote:

    Here is what I said:

    “Whenever we talk about Dual Agency, the most fascinating remarks to me come from Christine Forgione at NY Houses 4 Sale. Because they’re still working from sub-agency, we look like aliens to each other.”

    This was in a post completely tangental to the main debate.

    You’re complaining about people not talking about agency by maligning the weblog that talks about agency more than other weblog on the net.

    And: I invited you to weight in as a full participant in that debate.

    This was cheap, Ardell. Your argument is reasonable. You methods are not.

  3. In Florida, we have “Transaction” Brokers when a broker represents both seller and buyer and all agents in Florida are “assumed” to be transaction brokers unless single agency is established. Transaction brokers provides for limited fiduciary responsibility to both seller and buyer and must represent both seller and buyer in a fair and honest manner. An agent is a middle man, just there to facilitate the deal. When working with a buyer, I prefer to establish Single Agency. In that way I have full fiduciary responsibility to the buyer. If, for some reason that buyer decides he likes one of my listings or one of my broker’s listings as his/her choice, then we transition to a transaction broker to facilitate the deal. I’m not “mad as hell” because I think this is a fair and equitable solution to agency.

  4. There’s no problem with the full commisson, both sides, being in the price. As long as everyone knows that the Buyer Agent Fee is in there. House is $500,000 of which $15,000 is “the buyer agent’s fee”. No buyer agent, price is $485,000 instead of $500,000. Not Oh good, buyer is unrepresented, so seller’s agent gets to keep the $15,000 on forfeit.

    Noah, I hear ya. But I still find it hard to believe that the law says all agents represent sellers. Are you saying you basically “break the law” by operating as you do? Are there no buyer agency agreements there? No way for a buyer to be represented? If not; why not?

    Nicki, I was there in Florida the day they outlawed Dual Agency and brought in Transaction Brokerage. You can choose Full Fiduciary duties or Transaction Broker, but the fee doesn’t get reduced for the lesser representation…does it? That was about ten years ago. The fact that no other state has copied Florida is a clue. Not criticizing you personally, just how it is there. It was a good try, really it was. But you may be seeing some changes there yet, from what I hear.

    Greg, I haven’t a clue what you are talking about. If I don’t parody you word for word, you get personally offended. This is not the first time this has happened. We agree up to a point. At that point, where we disagree, you choose to take it personally. I wish you didn’t, because we both like to talk about these things. We just can’t seem to talk to each other about them without your ending up personally offended.

  5. NYC Realtors, I brought my daughters to NYC this summer for fun and we loved it. Their favorite part: The subway system.

    Here’s the ethical dilemma: How can you be a loyal servant for two masters? Answer: You can’t. Buyers often do not fully understand complex agency law because they are so emotionally invested in the outcome of the transaction.

    Real estate transactions are complex. Real estate agents arguably know alot more than the average, random consumer. That’s why consumers pay you what you’re paid: To be their warrior.

    I see it from this angle: A couple comes to see their friend, a divorce attorney, for help with their divorce. The couple is parting amicably. Everything starts out fine but, well, you know how things can easily go south fast. I believe an attorney has an ethical duty to only represent one of them and refer the other spouse to another law firm.

    If dual agency goes away, real estate agents could not sell homes listed with their broker, they would have to refer them out to another brokerage firm. Reciprocal referrals would be assumed.

    Economics drives morality. We have dual agency for many reasons, the first of which is profits.

    So then what would an ideal structure look like?

    The Mortgage Professor wrote about this a couple of weeks ago on Inman.com. He recommended that lenders agree to add the buyer’s agent commission to the loan amount so that it could be financed. His argument was that it was being financed anyways because it’s part of the purchase price.

  6. Christine,

    I totally get it. I worked Bucks County for many years. Your longer explanation makes more sense. But tell me. Why do you think you wouldn’t get paid as a Buyer Agent? You simply withdraw the “co-op” and replace it with the buyer agent fee being paid inside the transaction simultaneously.

    Thanks for explaining further. So it IS possible for a buyer to be represented. You simply have a “default” position of all agents represent sellers “unless” the buyer signs an agreement. That’s OK, not as good as WA, but OK.

    I just don’t understand why you wouldn’t get the same fee as a buyer’s agent, that you would as a sub agent. It’s still financed either way. If you are a buyer’s agent, does the listing agent keep all 6% or 5% or whatever the total is? He takes half if you are a sub-agent, but all of it if you are a buyer’s agent? Do you do that if you are the listing agent? Isn’t that negotiable?

  7. BTW,

    Doesn’t everyone just LOVE that recorded speech? I played it for all of my daughters this morning. I think I’ll listen to it again, I get such a kick out of it.

  8. > I haven’t a clue what you are talking about.

    I believe you.

    > If I don’t parody you word for word, you get personally offended.

    I’m not offended, I’m annoyed. You mischaracterized what I had said, implying that I endorse sub-agency, when the exact opposite is true. I don’t believe you are careful enough to have done this deliberately, but I have to defend myself from it anyway. You can spare yourself and everyone else a lot of trouble by quoting the text you think you are objecting to. This is the transparent way of engaging in debate in the weblog world.

  9. Jillyane,

    The majority of the states have Designated Agency so that Dual Agency only exists if John Doe AGENT sells HIS listing, not another listing in the company. Buyer is represented, seller is represented, works fairly well. Why CA and NY haven’t picked up on it yet, I don’t know.

    No representation is a consumer right as well. But when a seller chooses to be not represented, he doesn’t pay for it. What is happening in this Country all too often is that when buyers make this SAME choice to not be represented…the seller’s agent keeps that fee and gets double as a result. OR the seller keeps that fee in the price and he gets the money.

    Buyers need to understand that the fee is built into the price, and be given the option to hire an agent with it…or keep it, one or the other. Ignorance is not bliss.

  10. Greg,

    I did not “imply” that you support sub-agency. You read that into it. Who the heck would believe that Greg Swann supports sub-agency? That’s a freakin’ oxymoron. How can you be sure sure…if it was “implied” and not “said”??

    What I DID imply is that you pussy-footed around the issue, as if different states have the right to different ways. That some place with no buyer agency is “just different” and that’s OK. THAT is what I implied, and what I GOT, from what I quoted or misquoted 🙂

    P.S. I’d love to “cut and paste” it to avoid any conflict, but am told that is a “no-no” in the blog world and will create problems for Dustin for “plagerism” of sorts. I do the best I can without cut and pasting for that reason. I’m not being “cheap”…I’m being careful not to blackball RCG in the search engines.

    It was a word or too off, but what I was trying to “imply” is that you seem to think that if another state permits sub-agency, then agents there are OK to just go along with that.

  11. > And then we have Greg, and his Smackdown with Jeff and Russ, saying that WE look like aliens to NYC, as if WE who treat buyers as clients, have six toes on each foot when we take off our socks.

    I said nothing of the sort, nor any of the other nonsense you attempt to attribute to me.

    Fair use quotation is neither plagiarism nor duplicate content. It’s the way things are done in weblogging. Had you quoted me, you would have spared us both this imbroglio, as you would have said, “But wait, he didn’t say that…”

  12. Greg,

    If you have something to say on the topic, great. Otherwise, I’m not going to split hairs with you. What you said meant that to me…we are all subject to how the reader “takes” what we say. That’s my take. You can’t WILL everyone to take it the way you meant it to be taken. Sometimes I think you want to be contrary for contrariness sake, or to follow the advice of those who suggest starting “blog wars” to gain attention. I read that somewhere today…”start a blog war…get your stats up” Just an aside.

    In any case…you are splitting hairs. You DID say WE look like aliens to them…you simply also said that they look like aliens to us as well. They are the alients we are not…get it straight 🙂

  13. Greg,

    I never even quoted you, I just went back and read it. How can you say I didn’t “quote” you right? I linked to your whole thread and didn;t “quote” you at all. Jeez. I stand by my original thoughts on this…which were MY thoughts and not a quote. My thoughts are not subject to your “edit”. You can disagree with me or attempt to change my opinion. But I’d suggest you just “get over it”.

  14. Greg,

    Funny thing is, you and I are two of the few who actually, primarily agree on this topic. It’s a shame you take a 15 paragraph post that mentions your name once, and turn it into some kind of personal attack. If anyone should be complaining…it’s Russell, or even Christine who took it REALLY well, given her comments on both your and my articles were the ones “in question”. Never expected you to take it so sideways. It wasn’t about you…but it’s turning out to be somehow.  Not sure why that is.

  15. Ardell –

    “I just don’t understand why you wouldn’t get the same fee as a buyer’s agent, that you would as a sub agent. It’s still financed either way. If you are a buyer’s agent, does the listing agent keep all 6% or 5% or whatever the total is? He takes half if you are a sub-agent, but all of it if you are a buyer’s agent? Do you do that if you are the listing agent? Isn’t that negotiable?”

    As the listing agent, you can set up a buyer agent commission. It is to the discretion of the agent – when it really should be up to the seller, in my opinion. IF the listing agent puts a 0% in the buyer agent commission then it is up to the buyer agent to get compensated from their buyer. When this happens, yes, the listing agent keeps the whole 4-5% commission. I have on occassion seen an agent do the structure with a buyer agent getting paid by the Listing side. Sellers should most definatley have a say in this – but they don’t understand, they just know that they are paying whatever to whomever and most listing agents do NOT explain this to their sellers.. (Don’t ask why, I have no idea).
    On my listings – yes, I do offer a buyer agent a commission. My broker hates that – but I do it. I also split 50/50 on all commissions, whereas MOST agents here don’t do that. THAT infuriates me, but again it is what it is – and I am not going to NOT show a property when I know it is right for my buyers because the listing agent is a jerk. I do what I have to do and I just show.
    I just looked now on my MLS and in my area of Whitestone, Queens NY – out of 7 new/price change listings – the buyer agent gets 0%! There is ONE listing that is offering 1% as a buyer agent. Amazing isn’t it?

  16. “Sellers should most definatley have a say in this – but they don’t understand, they just know that they are paying whatever to whomever and most listing agents do NOT explain this to their sellers.. (Don’t ask why, I have no idea).”

    My take on this is that we, as the experts, are the ones who are supposed to know how best to market the listing. If we allowed the seller to dictate how much we offer as a split (which is a part of the marketing involved), then why wouldn’t we also ask how big the ad in the newspaper should be, or how much they would like us to budget for other advertising for their property?

    On a slightly different note:
    Thank goodness I don’t deal with residential much, but in the commercial world (as well as business brokering) there are plenty of agents and brokers that selfishly guard their listings. There is no predominant commercial MLS (not to say they don’t exist).

    My broker has no issue with splitting with an outside broker — we would be happy if someone else came and sold every one of our listings. What kind of service would we do our selling clients if we did not cooperate with outside brokers? And yet that’s what several other agents and brokers do.

    We just use it as part of our sales pitch. You can go with the guys that only care about keeping the whole commission, or you can go with us and have maximum exposure for your listing.

  17. Christine,

    Again, I totally “get it” because that is what happened in 1994 or so, when buyer agency was first introduced where I was in Bucks County, PA. I am not amazed at the structure. I’m amazed that it stopped there and didn’t progress.

    In a lot of ways, Christine, you make me feel a lot better. I realize how good we really have it here. Probably the closest system to one that treats buyers and sellers fairly equally. We have designated agency…kind of “love the one you’re with” on an individual basis. I can represent a buyer and someone else in the office represent the seller. We have buyer representation as the default, without contract needed, representation at first contact for the most part.

    While not everyone “operates” as I would like, the laws support the best life has to offer, as far as I can tell here in WA. So I’m not “mad as hell” anymore.

    Truth is…the reason NY would make me mad, is because New Yorkers came “over the bridge” and demanded buyer representation in Bucks County. We “got it” and you didn’t. Same with 3 day attorney review period. But we didn’t go the way of the “lawyer needed for every sale”. Consumers did not demand that. It must have been the strength of the Bar Association in NY, that created that.

    I have to say watching Richard Dreyfuss on Bill Maher last week is partly responsible for my getting so “riled up”. He made me realize how very much the ball is in our court to keep this Country on track with regard to the rights and options of the people. I’ll mellow out soon 🙂

  18. Nathan,

    Once in a while Russ Cofano asks me why it maters whether or not we have “statutory duties” or “full fiduciary duties”. Thanks for reminding me why it matters. Keeping the affect our decisions will have on our clients as the only thought process, is what I call “fiduciary”.

    I have always viewed the total commission as two different amounts with two different functions. One of the reasons I hate when people quote it as 5% or 6% instead of 3/3 or 2/3.

    I never expect the commercial markets to operate the same as residential markets. For the most part, they are not even subject to the same rules (RESPA) and general protections afforded the residential market. That’s why I don’t like agents who “crossover” and apply commercial mentality to the residential market. It’s harder for me to train agents, who started in commercial, to put the client first and to think like a buyer or seller of a “home”.

  19. Oh boy, the “Buyer pays for his own representation” is a bad idea. I’m surprised Ardell keeps pushing it (probably feels guilty getting a commission as a buyer’s agent).

    If people had to pay their own buyer’s agents, there would be NO buyers agents…they’d go out of business. People won’t do it. Why should they, they have the “free” MLS search to which they feel entitled (and for which buyer’s agents pay to have it on their website). They’ll just find the homes themselves online, and make offers. Most people don’t value some agent’s advice…it only takes several minutes to give so they see no value to it.

    What will happen, is since it would be virtually impossible to make it as a buyer’s agent, most realtors would revert to doing listings only, and we’d be back to the old system. But now, since so many buyer’s would be unrepresented, the listing agent would have to again make 4-6% to work both sides of the deal, just like it was many years ago.

    The way things stand right now, sellers don’t pay buyer’s agents, neither do buyers. The listing agent does! They get a certain commission and choose a portion of it to offer buyer’s agents for help. It’s like a bribe, or a bounty, if you will. Works perfectly. Now you have several thousand agents scrambling to show your property, nagging their clients to see it.

    I don’t see what the problem is anyway. It’s a great system and works well. The problem is with buyer’s agents who don’t take their job seriously!

  20. Will somebody please GET that the buyer already does pay their own agent now!! Sheesh!

    What’s so great about Redfin? They :get” THAT!!!

    Jim, thanks for the “explanation”, but it’s a fairy tale you have hard one too many times.

  21. “I never expect the commercial markets to operate the same as residential markets. For the most part, they are not even subject to the same rules (RESPA) and general protections afforded the residential market. That’s why I don’t like agents who “crossover

  22. Nathan: “We can’t have anyone central…tell us how much the split should be…” “…this doesn’t mean that the client can’t ask…”

    I always have a problem with the client NEEDING TO ASK to get the info they need. What if they don’t know to ask the right questions? Puts the client with the highest need for transparency, at the greatest disadvantage…not good.

    While I agree that local authorities can’t dictate what the split should be, I do think EVERY authority should require that the client sign the “split” that is going to show in the mls. The offering dramatically affects the client, and the amount of the offering should not be hidden from their view, nor should it be unilaterally determined by the agent without the client’s knowledge and consent.

    Nothing that affects the consumer to this degree should exclude them from the decision making process. If they want to offer 1% in a market that generally offers at least 2%, it is our duty to advise them of the potential negatives. But ultimately, and clearly, it is their choice and not ours.

    I totally “get” where you are coming from, and you are not confusing the issue to put in your $.02. In fact, it is very good for seller readers to see that some agents and brokers operate this way, so they know that they may HAVE TO ASK, to get this very important info.

    In that regard, your comments are very much appreciated, even though we do not agree. Transparency is good…hiding facts from consumers is bad.

  23. Ardell,

    There won’t be to many offers today in the real estate business up here in Bellingham, WA. It’s just after 2pm up here and I just checked my front yard for yard for the amount of snow…12 inches and growing. It is really snowing hard up here. Those buyers and sellers are going to have to wait a few days…I’m not kidding it is really snowing hard up here…wow. Funny little post if you want to read it. http://www.bellinghamwahomes.com/blogs/jerry_campbell/default.aspx Just your friendly weather man/ Realtor here.

    Ps…I love representing buyers. Folks…remember it takes a willing buyer to give all that money to a willing seller inorder to make a transaction. If it wasn’t for buyer’s that are willing to say “hey Mr seller, I agree…your house is worth this much. here’s $500,000” Don’t spend it all in one place now. Sure the Seller sets the comish…but it’s the buyer that agrees that the “Price is Right”. Thats called a “Market Value”. So id argue that the buyer and seller are already equally in the game of paying for the professional Realtor costs.

    I first had my real estate license in 1980…the days of one or two pages on a typical real estate license. The days when…yes we only represented the Seller. I’m glad those days are long long gone around here. That was wrong to not have representation for buyers as well. We have a good situation for the real estate transaction now. And, don’t even get me going on the thought of dual agency…it’s just a matter of being up front, being ETHICAL, and protecting each sides negotiating ideas and financial aspects. Dual agency is a challenge…but as professionals we can do a good job for both sides. Just be honest and protect both sides.

    Ok off my soap box and back to shoveling snow…lol “Its a Winter Wonder land out there after all”

  24. Jerry,

    You are so absolutely dead on right! I have one in escrow that sold at “market value” the other day…that price at which neither party is exceedingly happy. Lowest the seller would go and highest buyer would go. That’s why I say the market is fairly balanced right now.

    But that’s pretty much EVERY November, for as far back as I can remember. I expect Spring to be the same as last year as well. More multiple bids on certain properties. Still hard to sell an ugly on a busy road or a difficult floor plan.

    The only truly confusing market I saw, was as a seller in 1989 before I got into the biz. There really aren’t as many surprises out there as people think there are. I remember once I learned this crazy business from the inside, it was like a major light bulb went on. That was 16 years ago and the light bulb hasn’t burnt out yet 😉

  25. Christine,

    Did you read my post? No, I NEVER had any client sign a buyer agency agreement. There is no loyalty as a buyer broker between agent and client. The buyer can do whatever they want.

    However, when I have buyer clients, I work FOR THEM! Not for the seller. I try to find the best property that meets their needs, within their budget, with my thoughts on the property itself, the neighborhood, its asking price, and how to bid based on current market value.

    I do NOT disclose that I work for the seller, because I have absolutely NO CONTACT with the seller at all. I have contact with their hired broker who the seller agreed to pay a 6% commission to. If I get my client the property at a price that they agree to, then its clear that I worked for them on this deal.

    Jim said it best: “The way things stand right now, sellers don’t pay buyer’s agents, neither do buyers. The listing agent does! They get a certain commission and choose a portion of it to offer buyer’s agents for help. It’s like a bribe, or a bounty, if you will. Works perfectly. Now you have several thousand agents scrambling to show your property, nagging their clients to see it.”

    I look at the seller broker splitting their commission to the buyer broker for bringing the deal to the table.

    You said: If you have a listing that you are doing an open house, if you do them – how do you handle the buyers that come in? What do you do when a buyer makes an offer on a listing of yours? How do you work it?

    My Answer: I do my best to SELL the property! If Im successful, and they submit a bid, I submit it! If they are on their own or with a boker. I do not discriminate either way as my responsibility is to my seller in this case and to get the highest and best price possible. I only had 1 direct deal in my days as a broker and I think I actually did disclose to this client that I was hired by the seller. In fact, they low-balled, refused to go higher and my seller accepted. I tried to get the buyer up, but it didnt work. It was all they could afford. Honestly, I didnt expect a deal to get done.

    Also, Ive had buyers come into my exclusives and request information from me, which I provided to them. Does this mean I work for them now? No it doesnt. Im tryint to get my client a deal.

    I just dont see the big hassle in this process. Buyers should have representation whether they sign an agreement or not.

  26. Noah – I hate to beat a dead horse. Seeing as you are my neighbor – I want to understand what you are saying. You start off by saying ” I NEVER had any client sign a buyer agency agreement. There is no loyalty as a buyer broker between agent and client. The buyer can do whatever they want.” You have me here. BUT where you lose me is this statement: “I do NOT disclose that I work for the seller, because I have absolutely NO CONTACT with the seller at all. I have contact with their hired broker who the seller agreed to pay a 6% commission to. If I get my client the property at a price that they agree to, then its clear that I worked for them on this deal”.

    Granted – you may not know the seller, the buyer could be your best friend, your sister or your mother for that matter. Bottom line DOS says you work for the seller if you do not have established a buyer broker agreement. Just like a listing agent would have an agreement signed laying out the specific duties. A buyer agent would need to do the same. Just because a buyer walks into your office or calls you from your blog – does not make that your client. They are your customers and only your customers unless you have a BUYER agreement signed.

  27. Christine,

    Does the DOS say that buyer agency can ONLY be established via a WRITTEN contract? Can’t it be a verbal agreement or implied agency? Does it say unless you have a written agreement with someone else, a licensee by default represents the seller? Also, if there are 3 offers, two from “sub-agents” and one from a “buyer’s agent”, do you think there is any negative attached to the one from the “buyer’s agent” from the seller’s camp?

    Again, to Seattle readers…this does not apply here. We have buyer agency without written contract, by our State Laws.

  28. The agency can not be implied. Who implied what? Is it the agent that is implying that they work for the buyer? Or did the buyer imply/THINK that the agent was working for them? Who implied and how do you prove it?
    Verbal agreements – well not that I can imagine. Thats another – one word against another. How do you prove it?
    Written Would be the best. You must have the agency disclosure http://www.dos.state.ny.us/lcns/pdfs/1565.pdf filled out from the first contact. If you read it – it spells out who the agent is working for – The seller, the buyer or both. If this is done on intial contact then there would be no implying, no word of mouth it would be suffice as written.

  29. The DOS requires that the buyers sign an agency disclosure at intial contact. There should not be any implied agency ever. How would implied agency be proved? It has to be made known from first contact who works for who -the buyer,the seller or both.
    As for your other question – I actually can not answer that. I have never recieved an offer from a buyer agent. BUT, if I did – I dont think on my end it would make a difference –

  30. Well Noah?? Do you blame me for being THAT MAD at a Major City in this Country where an agent can say that she hasn’t even SEEN an offer from a Buyer’s Agent by 2006!?!?

    I stand by my post, and someone needs to get as mad as Howard out there and fix this.

    It’s not that I never hear or see this. I know a guy in some podunk town in PA, away from a “big city” who only handles historic homes, who operates this way. I can see his point, as he knows the quirks of really old houses and doesn’t promote other agents selling them who don’t know as much about these really old houses.

    But really…NYC? You definitely oughta be better than that, and “There Oughta Be a Law”, by this time. Where’s Richard Dreyfuss when you need him! Maybe Seinfeld! Someone needs to get mad about this. Someone who can make a difference. This is soooo antiquated. Isn’t anyone proposing Designated Agency? A law “in the works” at least?

  31. Christine,

    OK, right, they are my customers. But in my mind I treat them as a client, and the services I provide for them are as if they are my client.

    Thats all that matters in my mind, the real deal, the actions that are provided. If the DOS says I work for the seller, fine, than I am doing a very poor job for the seller as my true intentions are to represent my buyer customers.

    Is this better? Forget semantics, you know the point I am trying to make here.

  32. It WOULD be great if you could indeed wipe off “..that stupid smile on your face” (your words). You take cheap shots at Redfin yet appear to champion the very cause that Redfin offers to buyers – choice and empowering the consumer. Seems like a lot of consumers like Redfin for those reasons- I can understand why self-serving, self-important real estate agents/windbags don’t.

  33. Not sure what you are referring to, Mark. I’m going to let this comment stand, though the last line is obviously a personal attack. I’ll give you a chance to respond intelligently and on point. Where’s “the cheap shot”? If not, I’ll delete both this comment and yours if you are just “trolling by”…your choice. Keep the personal attacks out of it, and I’d be glad to respond to your “concerns”.

  34. Cheap shot illustrations for the painfully-obvious-challenged >> Start by looking at this post’s title…and your so thoughtful sharing of “why you like Redfin” previoiusly, etc. etc…. Perhaps you made this issue PPP..personal from the beginning.
    Maybe readers aren’t as interested in what YOU think – but it’s your blog so blab/blog on – I’m turning the channel -sorry for the distraction.

  35. Thanks for stopping back Mark. That wasn’t what I expected at all.

    I have to admit that from a “passing through” perspective, the post title is not “self explanatory”. But I would think most people understand that Redfin, to the best of my knowledge, is the only company that recognizes the buyer’s role in the real estate transaction. They are the only company that doesn’t act as if the fee paid to the Buyer Agent, is none of the buyer’s business. Maybe not the ONLY one, but clearly the one saying it loud enough to start making a difference in the way agents think about this issue.

    Those who “like” Redfin, as you state, are the ones who have already gotten “mad as hell” and refused to be ignored regarding their role in the transaction…hence the subject of the article “Empowering the Buyer Consumer – Redfin”. I acknowledge that they do “empower the buyer consumer”. Where’s the “cheap shot”?

    I thought maybe “the cheap shot” was in the For Sale By Owner post, which had nothing to do with buyers. I felt badly, but in being honest, said nothing that Redfin themselves have not said. They are less tried and tested on the listing side than the buyer side, just fact at this point in time.

    On the one hand, we (agents generally) are criticized for being “cheeleaders” if we only say superlative things about the market. On the other hand, are you asking us to BE cheerleaders, at all times, regarding Redfin or Zillow? Not fair. Everything has its pros and cons.

    But since you are just trolling by…no sense in going any further on this one.

  36. I’m just spellbound by these discussions over buyer representation. Almost as baffled as the California Association of Realtors was back in, oh, I’m not sure I recall the exact year — maybe it was 1982 or ’83 — when I wrote letter in support of operating as a buyer’s broker. Because that’s how I ran my brokerage and conducted business, as a buyer’s broker. In California.

    Even today, my buyers sign agency with me, except now I represent them exclusively. Nobody complains. OK, one guy did but I didn’t work with him. 🙂

    I look forward to the day when sellers sign exclusive listings that do not allow for dual agency. But for now, buyers can still choose in California. The smart buyers know enough to ask for a price reduction or credit if they are unrepresented, but the really smart buyers realize that by hiring a top-notch agent with superior negotiating skills, they are saving money by hiring a broker.

    The real question isn’t whether services or prices are discounted, it’s whether sellers and buyers are getting their money’s worth — are they getting what they are indirectly or directly paying for? Because every single real estate in CA has the ability to operate as an buyer’s broker if that agent so chooses.

  37. Elizabeth,

    I remember polling some people in California and they all seemed to “operate” and think, as if they had “Designated Agency”. In other words, if their agent was not the listing agent, they were OK with that, and felt that their agent was representing them and the other agent was representing the seller. For the most part, that is how everyone acted in the marketplace also.

    There were those who wanted to deal with the listing agent direct and work part of the commission into the transaction. I don’t think anyone can force “no dual agency” for that reason. Some buyers want dual agency, many want to call the listing agent. I don’t think we can make laws that tell the consumer they can’t do that.

    Much like Noah, where the laws haven’t caught up with his ethics. The marketplace acts as it should, and waits for the laws to catch up sometimes.

  38. Ardell,

    I agree with your assessment that the marketplace will eventually dictate the laws. Now, I don’t know what you are seeing in WA, but in CA, I foresee a time down the road, maybe within the next 10 years, when sellers will hire a listing agent and not offer a commission to a selling agent at all, and that will become the norm in the West.

    When that does happen, and I think it will, I just don’t have a crystal ball to say when, then you will see an increase of brokers using Exclusive Right to Represent buyer’s broker agreements. The forms I used in the 1980s called for the sales price to be reduced by the amount of the selling agent’s commission and that amount was then credited to the buyer for direct payment of the commission. It was clean. It was simple. It avoided sub-agency, and I received a lot of heat for operating in that manner from C.A.R.

    In addition, it removed all the complaining from competing brokerages over the listing commissions. Nowadays, the agency agreement I use says if the listing broker doesn’t offer enough compensation to meet my minimum commission requirements, the buyer will pay, at my sole discretion, the difference. At first blush, an agent may back away from using such an agreement, exclaiming, “What buyer in her right mind would sign such a thing?” But they will and they do.

    BTW, lovely blog.

  39. Pingback: Phoenix Arizona Real Estate - Dalton’s Arizona Homes Blog » Blog Archive » Rolling Over? I Think Not …

    • Not sure why you singled out Redfin on that, Terry. Clearly there are many brokerages in your area where an agent in the company has sold a listing of the company…and likely moreso than Redfin has. Why target Redfin? There is no state that prohibits a buyer working with an agent of a brokerage from buying one of the listings of that brokerage. Clearly banning buyers from buying any of the listed property does not exist anywhere in the Country.

      In WA ONLY the Listing “agent” now called “broker” vs “brokerage” (confusing) Only that ONE person represents the seller. In CA, as example, every agent in the brokerage represent the seller. But here in WA ALL agents represent buyers except “the” one and only listing “agent”.

      If you have Deisgnated Brokerage where you are, and it seems you do from your blog, then calling it Dual Agency when it is not is an invalid attack on Redfin by your own State Law.

      • Hi Ardell –

        I thought I had made it pretty clear in my post why I “singled out” Redfin but let me lay it out for you again. There are two primary reasons that I wrote the post.

        1) Redfin’s pro-consumer marketing message had always given me high hopes that their entrance into the real estate market would change the industry. This has not been the case and I was expressing my discontent with that fact.

        2) Redfin published a post on their blog a day earlier with what I felt was a rather misleading message ie that they have the best “buyers agents”. The hypocrisy between their words (“always on your side”) and their deeds (hello designated/dual agency) annoyed me sufficiently to respond.

        With regard to states that prohibit dual agency… I know that at least four (AL, FL, KS, MD) have an outright ban on it. I will have to do some more research to determine whether all have a loophole that allows agents from the same firm to work on the same deal.

        As far as the concepts of designated vs dual agency. Designated agency is a sub-form of dual agency. In designated agency the dual agency relationship does not disappear it is simply pushed up the food chain to the brokerage and principal broker while individual agents are assigned to the buyer and seller to act as advocates.

        As I explained in the comments of my post while both traditional and designated forms of dual agency are legal in Massachusetts, both create significant downsides for the consumer. Hence my state’s requirement of written notification before either is allowed.

        • Terry,

          I read your post and if you hadn’t dragged your beef into Seattle, I wouldn’t have put my nose in it.

          1) Redfin has changed the industry by forcing brokerages to recognize that the buyer agent commission IS the buyer’s “business” and not a “free” service. Not sure what you wanted from them with regard to change…but to suggest agents haven’t changed their viewpoint as to buyers and buyer agents is just not true. I believe there is a direct correlation to how buyers are treated by agents when the agent deems that they are getting paid by their client vs the seller of the home. In that regard they have made more progress in a short period of time than any other brokerage I know…and I know a lot of them.

          2) Thin argument. “Always on your side” when representing YOU is implied. If you’re trying to play the EBA card…put it back in your pocket. It’s a bunch of nonsense.

          3) Those states are far from stellar examples of how to handle Dual Agency given they have replaced it with NO duties. What a horrific “WIN” that was. Now everyone in Florida runs around being unrepresented almost always…both buyers and sellers. OH… that is so much better…NOT! I was in FL the very day they outlawed Dual Agency and the brokers had a freaking party about the reduced liability of being free to represent NO ONE…except…themselves! There’s a big consumer got screwed royally for you.

          I don’t know why you have your bun in a twist…but dragging your beef into Seattle doesn’t play.

          WA has the best Agency Law in the Country…and YES we do allow Dual Agency IF the buyer insists on using the house’s and seller’s agent…and sometimes they do. Taking away a buyers right to do so usually leaves no one in the entire state represented AT ALL. Not a better answer, Terry.

          It took the powers that pushed Transaction Brokerage in Florida about two hours to realize they were wrong. That was in 1996ish. Why do you think the majority of States never copied them? Because Transaction Brokerage sucks for ALL consumers, sellers and buyers alike.

          • I totally agree, Redfin has helped the industry along. Personally I’d like to see them go further and not fall into old real estate broker tricks hence my post.

            Not sure why the exclusive buyer agency “card” is a bunch of nonsense. It has always seemed to me that its the most straightforward way to operate. Redfin claims they are always on your side but in realty sometimes they aren’t on anyone’s side. If they operated as a true exclusive buyers agency they could actually back their words up.

            Don’t get me wrong I don’t have a problem with dual agency being legal especially when its properly disclosed. I just think its an ethically perilous road for any agent or brokerage to go down and its certainly hypocritical for a firm that claims to be sooo pro-consume to allow it as part of their regular business practice.

            I am really not that “twisted” about it. I just think its an important topic to discuss and I felt that Redfin’s blog post yesterday trumpeting their ‘buyer agents” warranted an examination.

            So again I am not advocating outlawing dual agency nor its stepchild designated agency I just think it should be understood and since even industry thought leaders like Glen Kellman and yourself still seem a bit fuzzy on the topic (designated agency is a form of dual agency and does not eliminate it) its probably worth talking about.

          • Terry,

            I’ve known some of the best EBAs in the Country in the last 20 years and the argument usually is just too self-centered and self-promotional. Clearly the majority of buyer agents who are not EBA’s are also not performing any kind of Dual or Designated Agency. They are more often selling the listing of another brokerage altogether.

            My problem is that while EBA’s will raise holy hell about Dual Agency, the usually have no problem having 10 buyers who all want the same house…or the same kind of house at the same price in the same place. To me that is a much greater conflict than Dual Agency.

            I will not take two buyers who want the same thing at the same price in the same place. I don’t know many agents who have that ethical stance…and clearly EBAs open themselves up more to that greater conflict of interest than Dual Agency represents.

            If you ONLY work with buyers…the odds that you will have two or more buyers with competing interests is greater than if you both list and sell. The answer to Dual Agency is not EBA or No Agency at all. And I am clearly NOT “fuzzy” on this issue. I have been a national advocate on this topic for more than 15 years with many discussions with many of the founders of NAEBA and Transaction Brokerage. So no…not fuzzy Terry.

          • PS…we in WA do not merely have “Designated Agency”…we have Buyer Representation as the default as in EVERY agent represents the buyers they speak with…unless they are “the” agent who represents the seller. I don’t think any other State has Buyer Representation as the default on as broad a scale as we do. Unfortunately…lots of agents don’t understand it though. 🙂 …and NAR comes in and teaches the ABR class incorrectly, making matters worse. But our law…the letter of it…is the best Buyer Agency Law in the Country, hands down…and has nothing to do with being an EBA.

            EBA just hasn’t worked out well. How long have you been doing that?

          • Our debate has trended toward a discussion over what the best type of agency is. For me exclusive representation is the best choice but I am sure there are situations where something else is appropriate. Certainly for any type of representation their are scenarios that create conflicts. Hopefully most brokerages consider these ahead of time and formulate a set of rules to guide their agents and their clients.

            Really the point I intended to raise with my post was not whether exclusive buyers agency is better than dual agency or designated agency but simply to highlight that a real estate brokerage, Redfin, was promoting something that wasn’t quite the whole truth. Their hypocrisy is what I am interested in. As far as I am concerned they can practice dual agency or designated agency or no agency to their hearts content. I just think they should very clearly explain to their clients what their roles is and in the case of the blog post yesterday I felt they did the opposite.

  40. LOL…read your website Terry, and it looks like you are playing the EBA card. Is Tom Early still alive and kicking? Tom Hathaway?

    Many before you have tried to convince the world that no agent can represent a buyer…except you. It’s a broken record and it didn’t play 20 years ago…or 15 years ago…or 10 years ago…or now. It’s a concept that might have worked if EBA was followed by ESA…but that battle was lost. I love the idea of EBA and ESA with no brokerage ever representing buyers and sellers. Sounds pretty cool. But it ain’t ever gonna happen.

    Sellers want a buyer and don’t want to work with agents who will never talk to a buyer. Buyer’s want a house and don’t want to work with agents who don’t know much about them as they never list them. A balance creates a better agent…better at negotiating…better at knowing how sellers think…better at most everything. The Country has spoken on that and no one wants an ESA…so EBA has no “counterpart” to create a New World with.

    Instead of picking on Redfin…given there are plenty of other “buyer agents” in your state to pick on, maybe you should try to convince ONE brokerage to open up an ESA shop. Then maybe you’d be getting somewhere.

    • Ouch. Well I guess your mind is made up, the world is the way it is and will never change. Glen seemed to take the same stance in his comment on my post. Maybe I am just young and naive but In the 10 years I have worked in the industry things have changed a lot, and mostly for the better. I hope the trend will continue.

      Shout out to Albert Tu @ Thread Real Estate and Michael Curtin @ Summerview Real Estate two exclusive sellers agents who both ranked in the top 30 agents by dollar volume for the entire State of Massachusetts last year.

      • So…how long have you been an ESA? Do you know who Tom Early is? Tom Hathaway? Do you know the Founders of “your movement”?

        Find me an ESA office with more than a dozen agents who never ever talk with buyers…or do the talk with buyers BUT let them be “unrepresented” buyers. That is not a better answer Terry. Never was. Never will be. Replacing partially represented with no representation at all…is not the better way to go on that. That’s why the majority of States went the way of Designated Agency. The majority isn’t always right…but the battle fought for 20 years that never gets anywhere…is not likely the right way either.

        ANY model that has to make everyone else wrong to be right…is not standing on its own merits. Its the attacks that kill the EBA model…don’t go that route…I can tell you it doesn’t work.

  41. The bizarre part is that both Mat, and Glen responded to what would be an obscure post, at best.

    Terry brought the post link here, because in a Google search, especially for redfin, this site comes up.

    He has made a good point.

    redfin is headed the way of the very business model they villified to establish themselves.

    • It’s good for all of us David that many who think the system is totally broken, come back full circle to be back pretty much like us. It proves time and again that the system isn’t as broken as people who are not “in it” think it is. It’s not perfect…never will be. But it’s not nearly as broken as some claim it is.

      It’s good to be tested and tested again…and found to be pretty much right. It makes you more right when people test you. I think it’s great!

      I wish Terry a lot of luck. I do. But I just wish for once an EBA could operate without bashing everyone else to draw attention to their biz model. There are more inherent conflicts of interest for buyers with an EBA model than a traditional model, so it’s just a bunch of hot air. What a buyer fears MOST is another buyer getting the house they want. So working with many buyers who want the same house is WAY worse than “Dual Agency”.

  42. The issue is the redfin business model. They have a lot of sales, maybe 25% are listed and sold within the same office, OK, let’s say it’s 15%.

    The web site is there to make sales, and generate leads. They say that every day. The agents they have don’t have to do anything because the web site generates the leads.

    The agents they have only need to write it up. In my opinion, that’s sales, not that there is any thing wrong with that.

    The other point I want to make is that both Mat, and Glen chose to comment on what would otherwise be an obscure post. How would they know? My suspicion has always been that redfin monitors the Google search for mention of the redfin name, and engages in dialog to generate web presence.

    • Personally I don’t have a problem with how Redfin breaks up the process – website generates leads, agents close leads – if anything I try and imitate this model.

      There is no question Matt & Glen monitor mentions of Redfin across the web. I think most companies concerned with their web presence do this. I suspect the reason they chose to comment was because I stuck a nerve when I exposed a chink in their “consumer first” armor.

      Obscure blogger – Terry Sanford

      • I think most companies respond to attacks. That doesn’t mean they have a chink just because they respond when someone attacks them. Usually people pick on Redfin more than other brokerages who do the same thing and more often…likely because it gets them more attention to do so.

        Also when they open in a new market, they are always more attentive to what is being said about them. Once they have some marketshare it becomes less of an issue than when they are still trying to make a name for themselves in a new area.

        So tell me Terry, have you ever had to reject a client because you already represent a buyer who has the same search parameters? What do you do if you have two people who want a 4 bedroom colonial with a basement on a 12,000 sf lot in the best school district? When the best one hits the market…which buyer do you call?

    • My friend David G. responded to any mention of Zillow when it first started. It’s pretty common practice for a Company to follow what is said about them. Usually when it is a new Company or they are opening in a new area, there is heavy monitoring until they get a good foothold.

      Matt monitors pretty much anything said about Redfin anywhere just as David did for Zillow. It’s pretty standard practice.

  43. Terry,

    Just saw this on your website: “Terry Sanford co-founded Territory, the real estate industry’s first true buyer brokerage.”

    Seriously? You think Territory is the first EBA Company ever in the Real Estate Industry? What year did you “co-found” it? Tom Hathaway started the first Buyer Agent franchise in 1988 and Tom Early started before him. Early founded the National Association of Exclusive Buyer Agents in 1995 and was the first president, and that was in 1995, almost 10 years after the “first true buyer brokerage” was founded.

    Has Territory been around since before 1988? Not saying it hasn’t. Just doesn’t look like a Company that was around back when we had mls “books”. 🙂

    “The industry’s first true buyer brokerage”??? Really?

    • Hi Ardell –

      I am more than aware that there are lots of other exclusive buyer agencies out there. Territory is different and in my opinion more “true” because we go a step beyond just exclusively representing buyers. We have also adjusted our compensation system to fall in line with exclusive buy-side representation. Instead of a percentage commission we charge the same flat fee on every transaction. This ensures that our clients not only get an exclusive advocate but that there is no financial incentive for said advocate to sell one house over another. I starting fooling around with the idea in 2004 while I was living in Manhattan but formally founded the company with my partner Marla Mullen in Boston in 2006.


    • Hard to avoid “the encounter” when the purpose of the “encounter” was web presence…but not Redfin’s. Seriously…do you really think that Redfin is doing the most “in-house” deals in Boston? Not likely.

  44. No, what he is saying, and it is probably true, is that redfin listings are posted on the web site. Buyers searching the web can make an offer on line. There is going to be a per cent of redfin listings sold by redfin agents. Actually the probability may be pretty high. Here in Seattle it is something like 18%.

    As to his other claim that redfin agents are in the top five, or ten, it makes no difference. They publish the sides of the transactions. redfin agents have more sides of a deal. That makes sense for what they spend on lead generation compared to the number of agents to an office.

    • Actually its 13% of Listings and 2% of total sales. I checked a strong office in Bellevue of a major brokerage and they are showing 21% (vs Redfin’s 13%) of listings being sold in house and 12% (vs Redfin’s 2%) of all sales being in house.

      So tell me…why is Redfin being targeted? Why not talk about the office with the highest number of in house sales? If my first random pick of office is 6X the number of total sales being in house…why are people singling out Redfin on this issue?

      • I can answer this for you once again. I wrote the blog post on Redfin for two reason…

        1. They claim to set a higher bar for themselves which I don’t think they are meeting.
        2. It was a direct response to a blog post they had published a day earlier trumpeting the success of their “buyer agents’.

        The post wasn’t about whether dual/designated agency is acceptable. It was about the fact that there was a hidden catch to working with Redfin and that they were glossing over the defect just like any used car salesman would.

        • Terry,

          I get it, Terry. You are “more true” and every one else is disingenuous.

          The biggest “defect” a buyer agent can have, is working with two people who may want the same house. In this market where it is hard to find one really good house, what do you do if two or more people come to your site to buy the same house?

          If you had titled your post “just another traditional brokerage” based on the fact that they both list and represent buyers…that would have been more correct than “just another used car salesman”. Unless you call everyone, except you of course, a “used car salesman”.

          To David…looks like Terry’s “new” model is pretty much the same as Craig’s. One low price of $4,995, the balance rebated to the buyer. Maybe Terry can change his price to $4,994 so he can be the one and only, true, and lowest. 🙂

          • Too funny. At no point have I said that “everyone else” is disingenuous. Redfin is presenting its dual/designated agents as buyer agents and I have called them out for this. Nothing less, nothing more.

            When I have two clients pursuing the same house I inform them both and then I offer the later mover the option of working with another agent at my firm or another agent of their choice.

            My title was intentionally provocative but it was meant to play off the fact that the real estate industry has a well know reputation for being disingenuous. One of Redfin’s main marketing message has been that they are out to change this and I found it ironic that despite their stated intentions they were sliding down the same old slippery slope.

          • ” Redfin is presenting its dual/designated agents as buyer agents…”

            Under the Law of Designated Agency they ARE “Buyer Agents” as both Glenn and Matt explained to you.

            Are you “above the law” too? You are not only disagreeing with Redfin…you are disagreeing with The Law of Agency in your State as well? Your Law allows for the “buyer’s agent” to represent ONLY the buyer’s interests, even if someone else in the company represents ONLY the seller. That’s your law and ours.

            So yes…even people who don’t work with “your firm” are Buyer’s Agents under the Laws of your State. Are you saying that Redfin’s use of the term Buyer’s Agent is illegal in your State? Or it just doesn’t meet your personal definition of the term?

          • Designated agency is not the same as buyers or sellers agency. Designated agency requires the use of a dual agent who designated advocates for the buyer and seller. It is simply not the same and their are conflicts that arise through designated agency that do not exist with buyers or sellers agency.

            My critique is that Redfin’s use of the term “buyers agents” to promote themselves is disingenuous. I called them out on this because I feel that they should be held to the high standards that they claim to embody.

  45. redfin is a lead generation site that offers searches that are more interesting to look at than just house pictures. The technology is a combination of search option that are very familiar to people here in Seattle.

    It is lead generation, with a sales team. You pointed it out in a very straight forward way.

    The top producer claims have always bothered me. A redfin agent is working the web site rather than the market place. Like I said, for what redfin spends on lead generation I would expect the sales people to do a lot of sides. I expect the investors were thinking redfin would do a lot more sides.

  46. “Designated agency is not the same as buyers or sellers agency.”

    That’s just not true, Terry, as an Agent can be designated to represent their client whether the buyer and seller are working with agents from the same firm or not. You are looking at Designated Agency only as it applies in a quasi-Dual Agency situation. But that is not the case.

    In a Designated Agency State such as ours, every Listing Agent is “designated’ to represent the seller of the home and every Buyer’s Agent is designated to represent the buyer of a home who is their client. This is true even when a Coldwell Banker agent helps a buyer purchase a RE/MAX listed home.

    You are twisting the facts to conform to your personal view or model, and then calling other good people disingenuous because they don’t conform to your personal idea of truth. I think that’s called slander.

    In your State, the issue is not whether the agent is a Buyer’s Agent…but whether or not all the agents employed by the firm represent that buyer. It’s pretty clear in our State that is never the case. We operate almost always on the basis that the agent you are working with represents you, but not all of the other agents of the firm who don’t know you from Adam. This pretty much conforms to consumer expectations and the way all offices operate. If the office has 160 agents, I don’t know any buyer who presumes all 160 agents are, or could be expected to, “represent” their personal best interest.

    Massachusetts does a good job, almost too good of a job, of explaining that those 160 agents may or may not represent you. We just make it clear that the 160 agents do not…which I think is a better stance, and basically the way Redfin views it given they started here.

    Do you know what the % of transactions are that invoke the Facilitator mode? In Florida, once they opened up a non-agency category, many brokerages opted for it as the default position to decrease liability. Is Facilitator the most common form of agency (actually non-agency) used now in your area? Any stats on that? We don’t have a TB or Facilitator status.

    I would rather you argue how you are a BETTER Buyer’s Agent than a Redfin or other firm’s Buyer’s Agents…than for you to insinuate that you are the ONLY “true” Buyer’s Agent in existence. How do you DO “it” better?…vs insisting no one else can call themselves a Buyer’s Agent.

    Again…I have heard your rant for 20 years from the small component of EBAs in our industry…it just doesn’t play. It sounds too much like “the ONE and ONLY – TRUE religion”. You are not on a mission to right the wrongs of an industry. You are on a mission to convince everyone that yours is the one and only true answer. If you were the first…I’d listen, as I did to many before you. But that battle has been wrought and lost, as the majority favor Designated Agency as the answer, and not the exclusivity of a career vs today purpose.

    Also…the only time the EBA card gets played is during a Buyer’s Market…a good sign it is only a “play” and not a “true” long term position of conviction.

    • I am not familiar with the setup in Washington State so I won’t speak to it but in Massachusetts designated agency is not the same as buyers or sellers agency (that’s why we have a different name for it). Designated agency allows for the possibility that a dual agency relationship will occur. Agreeing to a designated agency relationship means that a consumer may or may not be subjected to dual agency.

      Redfin presented its “buyer agents’ in a way that I felt was slightly manipulative since they were actually practicing designated agency and in some cases dual agency was occurring. That was my post. I don’t think it’s slanderous, I think its factual. Both Glen and Matt even acknowledged that their firm practices designated agency and that at times agents from their firm represent both sides of a deal.

      I don’t know where your hostility towards exclusive buyer agency comes from. I don’t really care to know. My post was not meant to promote my firm or the practice of exclusive buyer agency over all others but simply to call out Redfin on something that I didn’t think met their high standards.

  47. “…in Massachusetts designated agency is not the same as buyers or sellers agency (that’s why we have a different name for it).”

    I have read through all of the Massachusetts Agency Disclosure and ancillary forms and I do not agree that “they have a different name for it”. They call it Buyer Agency, with the distinction as to whether it is Single Agent Buyer Agency, or Entire Firm Buyer Agency…but it is still Buyer Agency by your own Law.

    The material causes the consumer to make the distinction as to whom their Buyer Agent is or is not…but it does not call it something other than Buyer Agency.

    Your three general classes are Buyer Agent, Seller Agent or Facilitator. As in Florida, my guess is that the Facilitator role was created to replace Dual Agency in whole or in part. How that operates in practice differs from one transaction to the next.

    But I will repeat, as it bears repeating, that having two or more buyer clients who want the same house is a much greater evil than Dual Agency. But that goes un-addressed by EBAs for the same reason Dual Agency is still permitted, or replaced with no agency, in most every State.

    The higher ground is NOT to move to representing 10 buyers who want the same house from representing a buyer and seller who want to buy and sell the same house. Not getting the house at all, in the mind of a buyer client, because their agent represented someone else who got the house vs them, is clearly the consumer’s worst fear and greater grievance. Informing them that you are willing to “kick them to the curb” in favor of another client is not a remedy and pointing a crooked finger at other businesses is a weak attempt at pretending to be superior.

    Had you pointed at ALL companies who do not exclusively practice single agency, without reverting to non-agency, well still crappy but…

    Singling out Redfin for a practice that is commonplace and appropriate in your environs is just a cheap shot to gain attention for a company that appears to have one agent, ONE “preferred” attorney and ONE “preferred” lender.

    Matthew 7:3 comes to mind:

    “”Why do you look at the speck of sawdust in your brother’s eye, and pay no attention to the plank in your own eye?”

  48. Massachusetts recognizes 5 types of agency representation and the definitions for each can be found on the second page of our Mandatory Licensee Consumer Relationship Disclosure:

    1. Seller’s Agent
    2. Buyer’s Agent
    3. Non-Agent Facilitator
    4. Designated Seller’s & Buyer’s Agent
    5. Dual Agent

    The disclosure forms explains that when designated agents from the same firm represent both buyer and seller that dual agency is created. Its really not that complicated: Designated agency = Buyer’s or Seller’s Agency with the potential for Dual Agency.

    if you’d like to write a separate post I’d be more than happy to contribute to a discussion on the merits and failings of the model Territory uses but it’s not really relevant to this debate regarding whether or not it is appropriate for Redfin, a firm that promotes its self as being so transformative, to under-represent the agency relationship that its agents practice.

    • You can twist it anyway you want to serve your need to attack Redfin…but #4 clearly states that “designated” does not “eradicate” the fact that the individual designated to represent the buyer client is “a Buyer’s Agent”.

      I am writing a post on the greater evil of having 2 buyer clients who have the same objective, as I have been meaning to do so for quite some time now.

      As to your desire to attack Redfin…focus on the word “attack”…and just day no. Attack someone else. Attack all the someone else’s who are Buyer’s Agents without being an EBA. Attack, Attack, Attack…or not.

      I say…”or not” is the best answer. Try founding a business model that doesn’t require that you attack everyone else, to gain a toehold in the marketplace.

      • That’s right, designated agency doesn’t eliminate the requirement for an agent to act as an advocate for the buyer or seller it does however allow for a dual agency relationship to be created with the brokerage and there are a number of very real pitfalls that come along with this. Hence my “attack” that Redfin’s identification of its Designated Agents as Buyer’s Agents simply wasn’t the whole truth.

        Seller’s, buyer’s, designated, and dual agency are all perfectly good models. My position is that it’s important for consumers to clearly understand what they are choosing and the advantages and pitfalls of each. If on the other hand you think its better to gloss over this stuff and pretend that all agency relationships are the same that’s certainly your prerogative.

        Look forward to your next post. it’s certainly an important topic and as an exclusive buyer’s agent I think one that is worth discussion.

  49. “That’s right, designated agency doesn’t eliminate the requirement for an agent to act as an advocate for the buyer…”

    Bingo. IF there is a CHOICE for an agent to be something other than a Buyer’s Agent…it is the choice of the client NOT “the brokerage”.

    All of Redfin’s Agents ARE free to be Buyer’s Agents, as they have claimed. If they are acting in a different capacity at any time, for any reason, it is the client’s reason. Clearly you would not take that “buyer’s right” away, and call it a good thing…I hope.

  50. Since you are having such a hard time acknowledging the downsides of designated agency I will spell them out for everyone.

    Under designated agency: If an agent is working for a buyer and that buyer decides they want to pursue a listing that the agent is representing in a seller’s agent capacity the agent is forced to abandon either the buyer or the seller. In either case the brokerage firm assumes a dual agency relationship and can no longer offer guidance to either agent such that it might benefit their clients.

    This is a real and significant downside. Which is not to say that other forms of agency don’t have their own downsides but designated agency is certainly different from straight buyer’s agency. That was my quip with Redfin and its the last time I will explain it here.

    Terry Sanford – obscure, attacking, slandering, cheap shot taking, blogger/buyer’s agent

    • The REAL “downside” of Agency Representation is something YOU do, Terry…and not some perceived…maybe…might…OMG crap. IF I have a listing that is just perfect for my buyer client…which is a RARE, if ever, event, guess what? The seller is happy AND the buyer is happy. Happy…happy!

      However IF I have 3 clients who want the same house…TWO of the THREE would have to be UNHAPPY at the end of the day. A much worse dilemma than the one you choose to “target” in your smear campaign against Redfin.

      This is the Question you DON’T want your clients to ask you:


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