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Real estate agents operate under different agency relationships and business structures. Understanding these differences helps buyers and sellers choose appropriate representation. The type of agent affects who they represent, what services they provide, and how they’re compensated.

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Agency Relationships

Represents the buyer in a transaction.What they do:
  • Help find suitable properties
  • Provide market analysis
  • Arrange showings
  • Write and negotiate offers
  • Coordinate inspections and due diligence
  • Advocate for buyer’s interests
Compensation: Typically paid from commission split at closing. Sometimes paid directly by buyer through buyer-broker agreement.Fiduciary duty: Owes loyalty to buyer.
Represents the seller in a transaction.What they do:
  • Price property through comparative market analysis
  • Market property to potential buyers
  • Manage showings and open houses
  • Review and present offers
  • Negotiate on seller’s behalf
  • Coordinate transaction through closing
Compensation: Commission percentage agreed to in listing agreement, paid at closing.Fiduciary duty: Owes loyalty to seller.
One agent or brokerage represents both buyer and seller in the same transaction.When it occurs:
  • Buyer’s agent’s client makes offer on listing agent’s listing
  • Two agents from same brokerage represent buyer and seller
  • Agent has buyer client interested in their own listing
Legal status: Restricted or prohibited in some states. Where allowed, requires written consent from both parties.Considerations:
  • Limited advocacy for either party
  • Agent cannot disclose confidential information to either side
  • Neutrality required in negotiations
  • May reduce commission paid
Some buyers and sellers prefer to avoid dual agency due to inherent conflicts.
Agent facilitates transaction without representing either party.What they provide:
  • Ministerial acts (paperwork, coordination)
  • Market information
  • Transaction management
What they don’t provide:
  • Advocacy for either party
  • Advice on negotiation strategy
  • Fiduciary duty
Where used: Some states recognize this arrangement as alternative to traditional agency.
In a brokerage representing both parties, specific agents are designated to represent buyer and seller separately.
  • Each designated agent owes full fiduciary duty to their client
  • Agents don’t share confidential information
  • Broker remains neutral
Allows same brokerage to represent both sides while maintaining individual agent advocacy.

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Business Structures

Individual agent working independently under a broker.Pros:
  • Direct relationship with one person
  • Consistent communication
  • Personal attention
Cons:
  • Limited availability (vacations, sick days)
  • No backup if agent unavailable
  • All tasks handled by one person
Group of agents working together under team name.Structure:
  • Team leader (often the name on marketing)
  • Buyer’s agents
  • Listing agents
  • Administrative support
Pros:
  • Coverage and availability
  • Specialization (some handle buyers, some listings)
  • Combined experience
  • Systems and processes
Cons:
  • May not work with named agent
  • Variable team member quality
  • Communication handoffs
Questions to ask: Who will I primarily work with? Who handles what aspects?
Different company structures:Traditional full-service brokerage:
  • Complete marketing and support
  • Office infrastructure
  • Training and supervision
  • Higher commission splits to broker
Discount brokerage:
  • Reduced commission rates
  • Limited services
  • Self-service technology
  • Lower overhead
100% commission brokerage:
  • Agents keep full commission
  • Pay monthly fees or per-transaction fees
  • Minimal broker support
  • Experienced agents benefit most
Virtual/online brokerage:
  • Remote operation
  • Technology-focused
  • Lower overhead
  • May serve broader geographic area

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Specialty Agents

Represents buyers purchasing newly built homes.Expertise:
  • Builder contracts and addenda
  • Construction timelines and quality
  • Upgrade negotiations
  • Warranty coverage
  • Common builder practices
Note: Builder’s sales representatives work for the builder, not the buyer. Having your own agent is advisable.
Focuses on high-end properties.Expertise:
  • Luxury market trends
  • High-net-worth client service
  • Discreet marketing strategies
  • Luxury property features and amenities
  • International buyer networks
May hold designations like Certified Luxury Home Marketing Specialist (CLHMS).
Works with real estate investors.Expertise:
  • Investment property analysis
  • Rental market conditions
  • Cash flow and ROI calculations
  • Property management resources
  • 1031 exchanges
  • Multi-family properties
Assists clients moving to new area.Services:
  • Comprehensive area information
  • Virtual tours and remote buying
  • Coordination with relocation companies
  • Temporary housing assistance
  • Connection to local resources
Often part of relocation networks and receives referrals from corporate relocation programs.
Handles distressed properties.Expertise:
  • Short sale negotiation with lenders
  • Foreclosure purchase process
  • Bank-owned property (REO) transactions
  • Potential risks and issues
  • Required disclosures

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Agent Designations

Professional certifications indicating specialized training:ABR (Accredited Buyer’s Representative): Specializes in representing buyersCRS (Certified Residential Specialist): High production agent with advanced trainingGRI (Graduate, Realtor Institute): Completed comprehensive real estate educationSRES (Seniors Real Estate Specialist): Works with buyers and sellers age 50+SFR (Short Sales and Foreclosure Resource): Specializes in distressed propertiesDesignations require continuing education and experience requirements.
Designations indicate:
  • Specialized knowledge
  • Professional commitment
  • Ongoing education
Not all good agents have designations. Not all designation holders are exceptional. Consider designations as one factor among experience, reviews, and compatibility.

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Choosing the Right Type

Match agent type to your situation:
  • First-time buyer: Agent experienced with first-time buyers, patient communication style
  • Selling family home: Local market expert with strong marketing
  • Investment property: Agent with investment experience
  • Luxury home: Specialist in high-end market
  • Relocation: Agent with area expertise and relocation experience
  • New construction: Agent who understands builder contracts
  • What type of clients do you primarily represent?
  • Do you work solo or as part of a team?
  • What is your specialty or focus area?
  • What designations do you hold?
  • How is your brokerage structured?
  • Who will I work with day-to-day?

Next: The Agent Process

What agents do from initial contact through closing

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