Buyer Agency Explained

What is a Buyer Broker?

• A Buyer Broker is a licenced real estate realtor, who is responsible for helping the buyer select and purchase a property
• A Buyer Broker assists in financially pre-qualifying the buyer and helps assess their needs, pre-screening properties, arranging for showings, drafting Agreements of Purchase and Sale, negotiating the transaction with the listing broker and managing the multitude of other details necessary to allow the buyer to buy the property
• The typical nature of the relationship between the buyer and the buyer broker is an 'Agency' relationship

• All realtors (as required by their Code of Ethics) must establish the manner in which they will represent a buyer in a transaction.  There are many different kinds of relationships (i.e. agency, contractual, employer-employee, etc.)
• Historically, realtors have had agency relationships with their clients
• In an agency relationship, the realtor has the following responsibilities to the buyer:  
  • Obedience
  • Accounting
  • Competence
  • Diligence
• There are two kinds of agency relationships a buyer would have with their realtor.  They are:  Buyer Broker or Listing Sub-Agent relationships

• In a buyer broker agency relationship, the realtor is obligated to meet the responsibilities indicated above (i.e. obedience, good faith, etc.); in other words, the agent has the duty to look after the interests of his client, the person he is working for
• When you are buying a property, the alternative to a buyer broker agency relationship is called a listing sub-agency relationship.  This relationship is the opposite of a buyer broker relationship
• In simple English, a listing sub-agency relationship means that the realtor now works for the seller, not the buyer and accordingly is responsible to protect the seller's interest in the transaction, not the buyer's
• Most buyers would prefer a buyer broker relationship as this ensures that the realtor is working for their best interests throughout the process and especially during the negotiation stage of an offer