Listing Agent vs Selling Agent
What’s the Difference?
Written By: Mariko Baerg, REALTOR of Bridgewell Real Estate Group
If you’re looking for a realtor to help you buy or sell, contact our team today!
There are a number of differences when it comes to the listing agent vs the selling agent in real estate.
This blog explains the differences in the listing agent vs the selling agent with regards to what their roles are, how they differ, and why they should not be the same person.
If you’re looking for an agent to help you buy or sell a property, read this blog first for important information on the listing agent vs selling agent in real estate!
Listing Agent vs Selling Agent
Broadly speaking, there are two different types of traditional real estate agents:
- Listing Agents: This is the agent that represents the seller of the property. They help you price, market, and sell your current home.
- Selling / Buyer’s Agents: Help you search for, make offers on, and purchase your new home. This type of agent is commonly referred to as the buyer’s agent.
When you are represented by a realtor and have that realtor working solely for you as your agent, then regardless of whether you are hiring a listing agents or a selling agent, you can expect:
- Loyalty to You
- Duty to Avoid Conflict of Interest
- Requirement to Fully Disclose Information
- Duty to Protect Your Confidentiality
Because representing both a seller and a buyer in a transaction is a clear conflict of interest (the seller wants the highest price, but the buyer wants the lowest price), most real estate transactions involve both a listing agent (rep of the seller) and a seller’s agent (rep of the buyer).
Now, let’s get in to the roles of the listing agent vs selling agent.
What does a listing agent do for a home seller?
There is a lot to do when selling your home, and all of that is managed by the listing agent. From the day you start thinking about selling and want a market evaluation to the day you close and move out of your home, the listing agent will be there for you every step of the way. Here are some of the duties you can expect from a listing agent:
Offers local housing market expertise & a competitive market evaluation: A listing agent will be one of the firsts contacts when you consider listing your home. They will be able to prepare you with a competitive market analysis to help you estimate market value of your home. A great listing agent will have a strong understanding of the market in your neighbourhood and be able to offer local market expertise for your type of property. This knowledge will serve you further throughout the process, specifically when you receive an offer on your property and need to negotiate the price based on market comparables (aka comps) and stats.
Recommends a listing price & strategy: Accurately pricing property is perhaps a listing agent’s most important role. After reviewing the competitive market analysis with you and providing you with market comps, the agent should be recommending a listing price based on your real estate goals. They should know whether you can push the envelope based on the supply and demand market trends in your area, or if it’s better to price to sell or at market. Listing strategy and pricing extremely important when it comes to selling quickly while yielding the maximum amount of profit, so it’s important that you work with an experienced agent that is familiar with your type of home and area and can recommend an appropriate listing price.
Helps you to prepare your home for sale: Listing agents know what sells a house and what turns prospective buyers away. They can suggest quick home repairs that will disproportionately increase market value, or possible renovations that will result in a good ROI for you. They’ll be the ones supporting you with professionals to get the home ready to market, and should be coordinating professional photography, videography and floor planners that give your property a competitive edge on listing sites.
Lists the property on the MLS & markets online: Your listing agent will be able to advertise your home on the realtor Multiple Listing Service (MLS), which is a comprehensive database of listings for sale by licensed real estate agents in the area. The MLS is run by the local Real Estate Board, and is the site that links to all other listing advertised sites to ensure maximum exposure of your home. Since the majority of all properties are discovered through this catalogue, it’s a great disadvantage for a property to go unlisted.
Advertises on social media & increasing exposure: A great real estate agent should have a marketing plan to maximize exposure of your home listing. Make sure that the listing agent you choose advertises on social media outlets like Facebook, Instagram, or REW.ca, in addition to the basic MLS listing advertisement. Ask them what other types of marketing they do, like open house mailers or email marketing to their database.
Handles showings and open houses: The listing agent will be the one that is responsible for organizing showings and open houses, and allowing potential buyer’s and their agents access to viewing your home. A great listing agent should be doing all of their showings and open houses in person (rather than on lockbox), so that the buyer’s know all of the benefits or your property or in case they have any questions about the property. Listing agents can talk up a property, keep it safe, and act as an objective presence to make prospective buyers comfortable (nobody feels comfortable wlaking through a house while an owner is watching them like a hawk, so it’s good to have a 3rd party that the buyer can feel comfortable around). The listing agent also knows what to disclose and what not to disclose, to ensure that there aren’t any issues down the line.
Screens potential buyers: Because a great real estate listing agent will be there in person to do their showings and open houses, they should be able to screen potential buyers to make sure that you’re able to separate serious buyers from the not-so-ready or not-so-serious to avoid wasted time. Your listing agent is there to confirm that buyers are pre-approved and prevent a collapsed offer at all costs.
Negotiates offers on behalf of the seller: While most seller’s goal is to obtain the most amount of money out of their sale, negotiations also typically include stipulations about closing dates, subjects, terms, warrants, and deposits. Even once an offer is accepted, the agent is there to represent and negotiate if required during subject removal and assist with legal obligations and financial due diligence until closing. A great listing agent will be a strong negotiator, and put the seller’s best interests first.
Helps with paperwork and closing: There is A LOT to know when it comes to real estate (believe me, I’ve written over 200 blogs on different topics… there’s a lot to talk about). Do you know the six most common subjects? Do you know what types of warrants to put in to a contract or cross out? How familiar are you with regional rules governing residential property disclosure? Do you know the difference in roles of a notary or a lawyer when it comes to completion? Selling a home is a high-stakes — and regulated — transaction. An experienced agent will help you navigate the sea of legal documents, contracts, and tax procedures to ensure you don’t inadvertently overlook an important detail that could result in an audit or lawsuit after closing.
What does a selling agent do a for a home buyer?
The selling agent, also known as the buyer’s agent, will help the buyer navigate through purchasing a home from start to finish. As a buyer, here’s some of the duties you can expect the selling agent to cover:
Helps buyers find financing: One of the most important steps to avoid time and gain clarity for a buyer is to get pre-qualified for a mortgage. Selling agents can connect buyers with credible lenders and experienced mortgage brokers to ensure that the buyer has a clear picture of their affordability and what the mortgage payment is going to look like. This financial backing will ensure that when a buyer is ready to make an offer, they can do so quickly and with confidence. A great buyer’s agent will have a team that they can recommend to help the home buyer get a great rate and a mortgage that meets their needs.
Discovers new properties: Many public sites like REW.ca or Realtor.ca have a lag from when the property is listed and when it actually hits the realtor MLS site. Furthermore, they often restrict the amount of information available (like pet or rental restrictions). Selling agents will have full access to all properties on the MLS (the biggest real estate listing database), as well as a wide network of agents and any private listings available to you. Using this comprehensive catalogue, selling agents are able to pick out the properties most suitable for their clients and expedite their house hunting journey, as well as set you up on auto notifications so that all new properties that match your preferences are emailed to you instantly without need of manually searching!
Coordinates and guides property showings: This is the most visible role a selling agent plays: walking their clients through the prospective properties they’ve selected for them and organizing a tour with the listing agents. A great selling agent will know the area that you’re looking in and how other homes compare, so that they can provide you with an unbiased and informative opinion on the properties that you’re interested in.
Offers you a comparative market analysis on properties you’re interested in: Great selling agents have the same in-depth knowledge of the housing market as their listing counterparts (ideally more), and understand whether a property has been fairly priced and how it can be expected to increase or decrease in value over time. They will be able to provide you with an estimate of market value based on the recent comparable sales for properties in the same area, as well as given you an opinion on what offered prices are too high or too low.
Prepares & negotiates offers on behalf of the buyer: The selling agent acts as an objective legal representative for the buyer, and is responsible for presenting offers and counter-offers to the seller and/or seller’s agent on your behalf. The buyer’s agent writes the initial offer presented to the seller, so they will be able to guide you and recommend appropriate prices, subjects, clauses, terms, and dates to add to the contract of purchase and sale. In addition to a deep understanding of the complicated closing process, selling agents are capable of negotiating neutrally, absent the intense emotions that buyers can feel when bidding on a new home.
Helps with subject removal and performing due diligence: The subject removal process requires a lot of reviewing, paperwork, correspondence and bookings to ensure that due diligence is done and you know what you’re purchasing. Whether it’s reading through strata documents, setting up a home inspection, calling the city, reviewing the title search and property disclosure, or helping you obtain a quote for home insurance, the selling agent is there to support the buyer during subject removal and make sure you are fully aware of what you are purchasing.
Helps with paperwork and closing: Buying a home is a complicated process, and the selling agent is there to help with facilitating the accepted offer, subject removal, and closing process in addition to the team of a mortgage broker, inspector, and notary or lawyer. This process involves a huge amount of paperwork, disclosures, and legal documentation. Agents have extensive experience with paperwork, contingencies, and the other legal ins and outs of the home buying process. They’ll help ensure your closing goes smoothly and prevent any surprises down the road.
Listing Agent vs Selling Agent Commission
At the time of listing a home, the seller and their designated real estate agent agree to a gross commission; which in turn will be split between the listing agent and a buyer’s agent.
The seller then pays the buyer’s agent commission, also known as the cooperating brokerage commission, to the buyer’s agent. Offering a full cooperating commission is done to encourage Buyer’s Agents to bring their Buyers to see the property, and the agent whose Buyer actually purchases the property receives their split of the commission upon completion.
Just to reiterate – Buyers do not pay their Buyers Agents!
The Seller pays a commission to the Sellers Agent who then splits that commission with the Buyers Agent when the property sells!
A typical gross commission (split between the listing & selling agent) in the Lower Mainland is 7% on the 1st $100,000/3% on the balance, in which a typical portion of 3.255% on the 1st $100,000/1.1625% on the balance is typically given to the selling agent (buyer’s agent). The difference between the gross commission and the selling agent commission is what the listing agent receives as a commission.
When the Listing Agent is also the Selling Agent: Limited Dual Agency
In the past, buyer’s had considered to purchase through the listing agent (aka dual agency) or as an unrepresented buyer on their own.
The Real Estate Council in recent years has introduced the Disclosure of Representation in Trading Services and also an Unrepresented Buyer Form to make sure that Buyer’s knew exactly what it meant to be purchasing either with a listing agent/without a realtor representing their sole interests. They found that many buyer’s did not actually know what it meant to purchase without a realtor, or how the conflict of interests and duties to them would be compromised if so.
For this reason, dual agency is no longer allowed unless all of the following requirements are met at the discretion & approval of the council:
- The property is in a remote location.
- That location is under-served by real estate professionals.
- It would be impracticable (i.e. not possible) for the parties to have different real estate professionals.
Ultimately, the council has made it clear that dual agency is banned – and that there is no way of getting around dual agency in a market like Vancouver where we clearly do not meet any of the 3 exceptions.
Related Article: Dual Agency Banned in Most Cases in BC
In the case of dual agency, the agent representing both parties gets to keep the entire commission because they are doing more work by representing both sides. One of the reasons for banning dual agency is that, on top of the fact that each party involved has different goals that collecting a double commission is a conflict of interest that skews some agent’s judgement in terms of what is truly best for their client.
While buyer’s can still choose to purchase as an unrepresented client, purchasing through the listing agent in a dual agency relationship for the most part, been banned.
Selling Your Home Without a Realtor
While the majority of home sellers choose to work with a real estate agent, there are some who choose to list their home for sale on their own which is typically referred to as a “For Sale by Owner” home. (aka FSBO)
While you can feel like you are “saving” on the commissions, keep in mind that while the internet has changed the way people shop for homes (half of the homes purchased in 2016 were found online); still, 88 percent of buyers use representation to manage the transaction.
In addition to the time and work that you’ll need to put in to selling your home (showings, photography, staging, floor plans, open houses and more), many home sellers don’t have access to comprehensive market data such as competitive properties, or sold and expired properties that would help them to determine the best listing price and estimate true market value. For a lack of knowledge of the market and lack of exposure & marketing, many FSBO properties end up selling for less than what they would have sold for if listed by a realtor. On average, homes initially listed FSBO take 20 days longer to sell than those listed on the MLS by a realtor — and when they do sell, they sell for less.
A lot of sellers that list their home on their own underestimate the amount of work and time that is put in by a listing agent. Even while in one of the hottest markets a few years back, less than a third of FSBO’s are successful at selling their home on their own (and most of those in this category knew their buyers personally beforehand). The rest eventually enlist the help of a realtor to get their property sale back on track; in fact, 90% of homeowners overall list and sell their home for sale with a realtor.
Buying a Home Without a Realtor: What to Keep in Mind
It is a new law by the Real Estate Council of BC that every buyer that wants to remain unrepresented be fully aware of exactly what it means to be unrepresented. As a buyer looking to purchase a home without a realtor, you will need to sign a document acknowledging that you understand that any agent you come in to contact with as an unrepresented buyer has no duty to you as a client, therefore they have:
- No Loyalty to You
- No Duty to Avoid Conflict of Interest
- No Requirement to Fully Disclose Information
- No Duty to Protect Your Confidentiality
You should also keep in mind the risks of buying a home without a realtor:
There’s a lot of legal information that you may not know. Buying a home isn’t as easy as you may think. If you’re buying a home without an agent you’ll need to know contract law, how to properly fill out a contract of purchase and sale, subject removal rules, terms and warrants to include, and much more. For what is probably going to be the biggest asset of your life, it’s likely you want to have an experienced realtor working on your side.
You won’t have full access to the comparable sales data. Market value is mostly determined by sales, as listing prices aren’t much help since the seller can list at, above, or below market value. In order to avoid overpaying for the home, you’ll want to have access to a realtor’s database on the MLS to pull comparable properties and sales that are great reference points for the home you’re purchasing. Right now, realtors are the only ones who have easy & complete access to this information online as many of the public sites are only able to display limited information.
Not everyone is a good negotiator. Negotiating effectively is a skill – it takes communication, knowledge, and resources. Even if you are a good negotiator, you probably haven’t negotiated many home sale – and it’s way different than price matching at the grocery store. An experienced realtor, on the other hand, has negotiated hundreds of times before and has a sense of what works and what doesn’t.
You don’t know what you don’t know. A realtor should have the experience of hundreds of homes, and as a result of that will know the red flags and potential problems to be aware of. If you don’t buy a home as often as your realtor (ask your realtor how many deals they do a year, not all of us are the same), then you may not know what to ask or what you are legally entitled to. Knowledge is power, and when you’re buying a home it’s good to know what to look for.
Related Article: If you’re wondering about what a realtor does to help when purchasing a home then check out our blog on “What Does the Buyer’s Agent Do & Why Should I Hire One?”
How to Find a Great Realtor
There are over 14,000 realtors in the Greater Vancouver Real Estate Board, so how do you find the right one?
Here are some tips on how to find a great realtor regarding of whether you are selling or buying a home:
Check how they market themselves: Begin your search for a realtor online and see how they market themselves. Are they at the top of google searches? Are they on social media? Do they have a blog or youtube channel? Do they have omnipresence in the market and what you would consider to be a good marketing strategy? If so, then you can probably expect a similar approach to your home sale.
Read their reviews online: Google reviews, Facebook or yelp are all great ways to start. Make sure that the agent that you’re looking to work with is credible and has great reviews, so that you know you’re working with a professional & experienced realtor.
Make sure they know the neighbourhood and type of property you’re looking to buy or sell: There are a lot of great agents, but you want to make sure you find the right agent for YOU and the property you’re dealing with. If you’re looking for a condo, make sure you hire a realtor that deals with condos and is familiar with strata documents and processes. If you’re on acreage then you’ll want to make sure you deal with an agent that knows the ins and outs of selling/buying acreages. Every transaction requires different skills sets, so make sure you choose the right agent that represents what you’re looking for.
Attend open houses: The best way to check if you get along with an agent is to meet them. An easy and low-commitment way to do this is by attending an open house they’re hosting. Do they make you feel welcome? Are they good at talking up the property? Can they answer all your questions? Most importantly: would you want them hosting an open house for you?
Get to know them: Once you’ve narrowed down your search, contact the agents you like directly and maybe go for coffee. Ask them simple questions about their experience in the area, the typical price range they represent, how long their properties stay on the market, and how they might go about selling your property in particular or helping you buy. Also, go with your gut… do you like them and trust them? Do you get a good feeling about them? Sometimes it’s just as simple as that!
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Looking to buyer or sell real estate in the Greater Vancouver and Fraser Valley areas? Start a conversation with a realtor from Bridgewell Group by calling or texting 604-319-2020 or email [email protected] to talk to a realtor about buying or selling in the Greater Vancouver area today.
