There are over 1 million REALTORS in the United States. Of that amount, less than 1,000 dedicate their real estate practice unconditionally to buyers. The reason for this disparity is quite simple. Most feel that because there is a buyer and seller with every real estate transaction, creating an allegiance to only one party will eliminate 50% of their income potential.
Whether or not a traditional broker makes more money than an exclusive buyers broker is open for debate, but we feel it is more important that the direction we go with our business practice is set more by a moral compass than a monetary one.
It is our sincere belief that in real estate brokerage, a buyer should be able to rely on their broker to look out for them. Furthermore, real estate laws should be written by keeping the two most important parties in the transaction at the forefront…the seller and the buyer. We find it interesting that in the legal profession, the opposing parties cannot hire the same attorney (or an attorney with the same office) due to conflict-of-interest concerns, but in a real estate transaction it is perfectly legal that both buyer and seller use the same broker, or be represented by another broker in the same office.
The practice of real estate brokerage began with the understanding that because the seller initiated the sale by virtue of a listing contract with a broker, and it was the seller who was paying the brokers from the sale proceeds, the brokers should represent the seller’s interests. This relationship was not only true between the seller and the listing agent, but carried even father to the broker who showed the buyer the property. This was great if you were a seller, but buyers were left to fend for themselves.
It wasn’t until as recently as the 1980’s when the movement for consumer protection in real estate began to take hold. In fact, it started in Colorado. This philosophical change was, in part, from a realization that many consumers had been hurt financially or otherwise from no guidance (buyer beware), and also a realization that although it was the seller’s asset involved in the transaction, it was the buyer’s money coming to the table to make it happen. As such, both parties were contributing to paying the brokers.
However, due to heavy lobbying from the large, traditional brokerages with their fear of change and, more importantly, ‘losing 50% of their income’, the laws that have been enacted fall far short of where consumer protection still needs to be. It would be very simple to enact the same guidelines as the legal profession by having each party represented by their own council. But that may never happen.
We are not saying other REALTORS are unethical. They are working under the auspices of the law. However, if you are considering a real estate purchase, you have a choice of who you align yourself. The direction they decide to go will determine the satisfaction they receive. Traditional brokers operate by seeking listings, then market those listings for sellers. They will either represent the seller, as a Seller’s Agent, and owe a fiduciary duty to the seller. Or, the listing agent can work as a Transaction-Broker by simply facilitating the transaction and not advocating for either party. It is important for a buyer to realize in this type of situation the seller hired the broker due to some prior relationship (friend, neighbor, relative, the broker may have helped them buy the property, or the seller liked the broker’s presentation to get the listing).
Traditional brokers also advertise themselves as a buyer’s broker, but they can also take listings, upon which the potential for a conflict-of-interest exists to buyers.
As exclusive buyer agents, we offer a higher level of service and standard. We have committed our services to the sole benefit of buyers. We believe a buyer needs to be able to rely on the services of their broker. When a client asks for our honest opinion on the value of a property, we provide a thoughtful and reliable answer. Want to come up with a negotiation strategy to buy a property? With our years of experience we’ll develop a strategy with your needs being our number one concern. We maintain confidentiality and professionalism with each and every client.
Our services are not dictated by how much money we can make, but by the value of our services to you.