In Barry Stone’s column on Inman News this week, “Resolving disputes over home repair estimates,” a worried home buyer writes in with an almost classic scenario: The buyers are in escrow, their home inspection reveals that the furnace needs repair, and now they’re negotiating with the seller over how much the repairs will truly cost (with different prices named by different contractors) and how much the seller will pay for it all.
Unlike some homebuyers who don’t know which contractors to trust, this pair feels pretty confident in their own heating repair folks — and less than eager to rely on the lower bids (surprise, surprise) from the seller’s favored contractors. As with all mid-escrow negotiations, this may come down to how badly the buyers want the place, and how hard the sellers want to push back, risking the collapse of the deal.
But there’s a wrinkle to this case that caught my eye: The buyers say, “When we insisted that the work be done by one of our contractors, the sellers’ agent said this was an “outlandish” request.”
Where’s their own agent in this deal? Stone noticed the same thing, and said, “Hopefully you have an agent of your own who will negotiate on your behalf, rather than giving in to the sellers’ refusal.”
I’m guessing they don’t have their own agent. Dual agency — when the same agent attempts to handle the deal on the buyers and sellers’ behalf — is still “common” in the U.S., according to a survey of agents by Inman. This arrangement often arises when buyers visit an open house before getting an agent, fall in love with the place, and agree to the listing agent’s urging that, “I can just draw up all the paperwork for you and we can get this deal done!”
Hopefully the seller’s agent in the above case disclosed to the buyer (as is legally required in most states) that they’re now in a dual-agency relationship, and got the buyer’s written consent. (But did the agent really explain what it meant?) Hopefully also, the buyers will soon catch on to the fact that the sellers’ agent is not fulfilling his or her duty, as a dual agent, to act in an unbiased manner, avoiding promoting the interests of one party to the detriment of the other. They should raise this issue with the agent and his/her broker/supervisor.
Because there’s no doubt that calling this buyer’s request “outlandish” is promoting the sellers’ interests. It’s rather, well, outlandish.