A good question. Agency is a topic that has gotten a lot of attention in the past few years by the courts. There has been a lot of confusion about Agency by both clients and brokers. It depends upon your persective. The listing broker will almost always know more about the property. However, the listing broker is contractually bound to act as a fiduciary to the seller of the property. This means his loyalty is to the seller, not the buyer. This means that while he can negotiate for you, at the end of the day he may not have your best interests at heart. A buyer's broker may negotiate harder for you, since his loyalty is contractually to you. If the listing broker represents you, then he's performing Dual Agency. This is perfectly legitimate and legal, as long as you are made aware in writing that he ultimately represents the seller. However, Dual Agency can potentially be a minefield for a broker, as he is now serving two masters, with each master thinking they are the client. With Dual Agency, the listing broker will earn the entire commission, so the listing broker can sometimes offer you concessions if the negotiations get tight. A specialist is a good idea. You will needs someone who knows the financial ratios, real-world costs and realistic rental levels. Finally, do your own homework. Research the actual rental comps up and down the street you intend to buy on. Spend a few hours knocking on doors of tenants and ask what they pay for rent and if they received andy concessions. Some won't tell you, but many will.
Jun 15, 2010