Real estate transactions can be tricky to navigate. It is common knowledge that real estate agents assist in selling and purchasing a property. People may not know that there are actually two different types of real estate agents: selling agents and listing agents.
This article will explore the differences between these two real estate agents, highlighting how sellers and buyers can utilize agents to complete a real estate transaction.
Who Is a Listing Agent?
Also commonly called the seller’s agent or listing broker, a listing agent is a person who represents the seller in a real estate transaction. This real estate agent puts the seller’s property on the market and is in charge of selling that property.
Typically, a listing agent has a contractual agreement with the sellers that states they are the sole agent and/or brokerage who can list their home on the market. The contract is important as it ensures the agent gets paid for their time and expertise once the property sells and that their respective brokerage gets credit for selling the home. Additionally, this contract outlines a fee, often a percentage of what that property sells for, so they can earn a commission.
Listing agents receive a commission, making them highly motivated to sell a property. They aim to sell a client’s listing in the shortest time for the highest possible price. This pay structure benefits both parties as the sellers can collect their profits and move to a different property. The agent collects commissions and gains visibility in the real estate world.
What Are the Responsibilities of a Listing Agent?
Knowing what each agent is responsible for is a great way to understand the difference between a listing agent vs. a selling agent. Below are some of the key tasks sellers should look for in a quality listing agent:
A Listing Agent Provides a Comparative Market Analysis
Though a seller’s main goal in a real estate transaction is to quickly and efficiently close the deal, sellers may not be aware of each detail that goes into selling a home. A listing agent needs to provide a Comparative Market Analysis, also called a CMA, to set expectations for themselves and the seller. <
A CMA is a report that outlines comparative properties in the area and what those properties sold recently for, and what current properties have as their listing price. The CMA helps to create a competitive price for the listing. A good agent will suggest a price that falls within the range of comparable properties to sell the home as quickly as possible.
CMA’s help the seller understand how to price their property. Specific components included in a CMA should be:
- The condition of the property
- Number of bedrooms and bathrooms
- The gross living wage in the area
Listing Agents Offer a Detailed Marketing Plan and Professional Photography
Along with providing a CMA, a listing agent should review how they plan to market a seller’s property. Unless they already have a buyer in mind, selling a home can be pretty difficult. Listing brokers should always have a detailed marketing strategy to advertise listings.
Components of this marketing plan can draw components from how they sold previous listings, but it also should reflect the uniqueness of each property. Professional photography is a great way to capture individual features.
Photography is the first thing selling agents see when trying to find a home for their clients, so it is essential to make a property stand. Photos can also attract buyers looking for themselves on websites such as RealtyHop.
A Listing Agent Will Handle Negotiations and Communication
A listing agent must take responsibility for getting the best price for their seller’s property while carefully keeping track of the terms and conditions of the buyer’s offers. Sometimes this can be tricky as an agent is motivated to sell a property but has to keep their client’s best interests in mind.
To ensure both the listing agent and the seller are on the same page, both parties will sign a Seller’s Agent Agreement. This agreement is a contract that states the property’s listing price and other terms and conditions of the property. A Seller’s Agent Agreement is a legal document with agreed terms that the agent must follow.
Who Is A Selling Agent?
Opposite a listing agent, a selling agent is responsible for helping a buyer find and purchase a property. Rather than selling the listing themselves, they look at properties available on the market and take their clients to listings that accommodate their wants and needs. A selling agent is also called the “buyer’s agent.”
Though some of the responsibilities between a listing agent and a selling agent are the same, some key differences distinguish the two from each other.
What Are the Responsibilities of a Selling Agent?
A selling agent accepts the following responsibilities to ensure they find their client a standout home at a fair price.
They Find a Desirable Property
First and foremost, a selling agent must find a property that fits their client’s criteria. An agent who takes buyers to houses with entirely different features than discussed will upset the client and possible terminate the relationship. An agent must understand what each buyer wants so they can view properties to potentially purchase them.
Selling agents will listen to their client’s budget, desired room size, required location, and any additional requested features and amenities to help find a match.
A Selling Agent Will Create a CMA
Like a listing agent, a seller agent must also conduct a comparative market analysis. This is to help ensure that the price of the home their client is interested in is fairly based on the area’s comparative properties. A buyer’s agent must get the best price for their clients.
In some cases, if an agent thinks a property is priced too high, they can negotiate with the listing agent on a fair price for the home.
They Continue to Be an Agent Until the Transaction Is Over
Sometimes buyers’ agents may feel that once an offer is accepted, they have completed their job, but that is not the case. A good agent will continue to monitor the transaction until the entire process successfully wraps up. There are plenty of issues that could occur even after an offer is accepted.
Agents also must be available to their clients throughout an entire transaction. Buyers could have questions and concerns after the sellers accept their offer, and agents must be able to support them throughout the remainder of the process. A great selling agent will have open communication with the buyers throughout the entirety of the transaction.
What Types of Clients Do Selling Agents and Listing Agents Work With?
A listing agent will always represent the person selling a property, while a selling agent will have a client interested in purchasing a home. Even though they represent different people, the two agents work together to meet the needs of the clients.
Selling agents and listing agents also work with individuals looking to rent, lease or sublet. Though some areas may not have robust rental markets, metropolitan cities and larger towns consist of a plethora of rental opportunities, with many agents eager to help find their clients homes.
On some occasions, an agent can be both the listing and selling agent, referred to as dual agency. Dual agency means an agent represents the person buying and selling the property. Since the agent represents both the seller of the property and the person potentially interested in purchasing that same property, various rules come into play to ensure both clients receive fair treatment.
A seller may be inclined to work with a dual agent as they can negotiate a lower commission and streamline communication with the buyer. When the seller directly talks to their agent, they know there is less room for miscommunication with the buyer as that exact person handles both sides of the transaction.
Legally, an agent representing both sides cannot give fair advice to either party, and they technically cannot even represent both parties simultaneously. It can be difficult for an agent working on both sides to remove all bias and remain neutral. Most brokerages would suggest to clients not to have a dual agent as it can impact the fairness of a transaction.
A selling agent vs. a listing agent share similar responsibilities but represent different parties. A listing agent represents an individual looking to sell their property and conducts research in the real estate market to determine a fair listing price for their client’s property. Additionally, they sell that property and remain available to their client throughout the transaction.
A selling agent represents an individual looking to buy a property. They must listen to the wants and needs of each client and find properties that fit within a predetermined budget. Like the listing agent, a selling broker must also be reachable throughout the transaction.
Both kinds of agents do their best to ensure they help their clients, and earn commission when they successfully close a deal. In a typical real estate transaction, both a seller and a buyer will use their agents, and both agents communicate with each other to seamlessly satisfy both sides.