Here is one of my pet peeves as a realtor: people who have chosen an agent to work with but ask other agents to arrange showings, unbeknownst to that agent. You ask these people if they have an agent and they say no because they haven’t signed any kind of contract. But really, they do.
I was contacted by a prospective client about one of my listings last week. I told her there was an Open House on the weekend and gave the agent hosting it on my behalf a “head’s up” that she was coming. When she was there, she asked the Open House agent if he could arrange for her to view some other properties in the area. Since she had contacted me first, he sent me her coordinates and I set up the viewings. (This, by the way, is the ethical way to proceed. Even though she asked him to show her around, she had contacted me first, so she was my prospect, not his.)
Now I am assuming she didn’t tell him she already had an agent. She certainly didn’t mention it to me in our many conversations. In fact, she didn’t mention it at all until we were standing inside of one of the properties. (I should have asked.)
“Alright,” I said to her as soon as she did. “Do you have a Buyer’s Representation Agreement with this agent? Because if you do, I can’t even talk to you.”
The Buyer’s Representation Agreement sets out that there is an exclusive relationship between that buyer and that agent. They contractually agree, among other things, that the agent will do his or her best to find the buyer a suitable property; the buyer agrees to refer any properties they come across to that agent.
Most agents would like to have one of these in place before they spend a lot of time with a buyer, but many are afraid to ask. Lots of buyers don’t want to sign them for the very reasons I’ve listed above. It limits their freedom to go hunting for properties on their own, and to deal with another agent. But it does protect the agent who’s investing all that time in this client for the period agreed upon.
“Oh no, nothing like that,” she said. “We don’t have a contract or anything. But she’s shown me a few properties. If there was something I liked, I’d probably want to use her.”
“Okay,” I said, a little annoyed. “Do you understand that if I’m showing you properties, it’s so that I can earn a commission on a sale? Either you are committed to working with me if you’re interested in one of these properties, or you aren’t. I can’t show you a property if your plan is to use someone else to make the offer. I wouldn’t make any money for my time. That’s not fair to me or to my brokerage.”
“Oh,” she said. “Well, I don’t know what to do then. I wouldn’t feel right about that; after all, she’s been showing me properties for almost a year.” (Note the progressive disclosure, as we used to call it when I was an adjudicator in Indian Residential School claims.) “Can’t you show me the ones you’ve already booked?”
“It doesn’t work like that,” I said. “If you have an agent you’re committed to using, even if you don’t have a contract, you should be contacting that person to show you listings. You shouldn’t be contacting another agent.”
“Oh,” she said. “Well. I thought it was okay in a private sale. I thought this was a private sale because it was listed on Kijiji.”
Now, that made no sense. The ad I put on Kijiji named me as a Sales Representative with Royal LePage, as did the “For Sale” sign out front at the Open House. My role as a realtor was prominent on all my emails. But I digress.
“You know,” I said. “That’s the kind of thing that drives realtors crazy. If you want to see a private property for sale you should be telling your agent so she can try to get you in.”
It was late, and I had booked quite a few properties for us to see so I came up with a third option. I asked her to call her agent and as soon as she did, I got on the phone and let the agent know what had happened. We agreed that I would continue to show her client the listings I’d already booked, and if her client decided to make an offer, I would refer her back to her agent and we would work out how I would be compensated for my time.
And so that’s what we did.
But there is a larger moral to this story, and it’s this one: If you are working with an agent, for God’s sake, work with them.
Don’t go contacting other realtors to arrange showings for you. I know, sometimes buyers don’t want to keep going back to their realtor after a certain point in time when they haven’t found exactly what they want ; they feel like they’re wasting their agent’s time. And they don’t actually have a contract with the realtor so they don’t see that they’re doing anything wrong.
Legally they aren’t. Morally, they are. And worse, they’re not telling anyone what they’re up to.
It isn’t fair to ask an agent to provide you a service without any expectation of ever getting paid. If I don’t sell a property, I don’t make any money. And it’s certainly not fair to your agent to be meeting with other agents without their knowledge.
As a buyer, you have to sign a Buyer’s Representation Agreement before you can legally present an offer on a property through an agent. So if you’re working with an agent, do them a favour and sign one right away. Then everyone knows what the rules are–you can have a very clear discussion about the time period of that exclusivity and what the expectations are.
This, like any other business, is about long term relationships. A Buyer’s Representation Agreement is a very good place to start.