Florida Waterfront Buyers Brokerage

Looking out for Home Buyers?

Looking out for the Buyers

In 1983, a Federal Trade Commission study revealed that over 72% of all home buyers mistakenly believed that they were represented by the agent who was showing them homes. The fact was that most agents showing homes were representing sellers. And by the legal requirements of "agency representation", a Real Estate agent must negotiate in the best interest of their client. This requires not withholding any information from them (possibly meaning they would reveal such important information as buyer's motivation, financial qualification etc.) and presenting their property in the most favorable way. When consumers became aware of this, they demanded their own representation. Consequently, laws requiring disclosing representation were passed all over the country... Enter the "exclusive buyer agent", an agent that does not have a conflict of interest since he/she only represents the buyer in a transaction. An Exclusive buyer agent works in the Buyer's best interest getting back to the legal definition of "Agency Representation".

Florida’s Dual Agency Solution ?

Florida is now a "Transaction Brokerage" state. That is, all Florida Real Estate Brokerages are assumed "Dual Agency" brokerages. These Transaction Brokerages represent 98% of Florida brokerages. Due to the FTC finding and the widespread practice of "Dual Agency", where the seller’s agent would represent both the Seller and the Buyer… "Conflict of Interest" was a legal problem that more and more brokerages had to deal with.

Today's Florida Transaction Brokers must walk a tightrope between the Buyer and the Seller. The Transaction Broker can NOT provide Full Disclosure or Fiduciary (100%) Representation to either the Buyer or Seller (some would call this leveling the playing field). In fact, they can't provide representation to either party. They are simply "Facilitators" leaving both the buyer and seller without meaningful representation and an agency protection. This is why they are called "Transaction Brokers". The National Association of Realtors has opposed this form of Real Estate since 1993.

Why would an agent choose to do this.... ? Because, as a Transaction Broker, the agent doubles his/her commission. As the sellers Listing Agent now Transaction Broker, the commission paid for selling the owners property is collected as well as the commission that the buyer would use to obtain his own individual representation is collected. This Double Commission (Double Ending) is the same as a Dual agents collect. The idea of twice the commission for no representation and the "conflict of interest" legal ramifications have caused "Dual Agency" to be band in a number of states. (see Transparency in Representation Maryland Law)

About Face….

Some have argued that today, Florida Law protects the Buyer's interest from a Seller orientated Real Estate industry and Dual agency. However, in 2008 the state of Florida DROPPED the long standing requirement that a Real Estate Agent must identify who he/she was working for or representing at the very first meeting with a new client. This law was originally written to provide transparency in representation and to protect buyers from agents not disclosing they were really working for the seller. Since then there has been a rush to "Buyer Brokerages"and their "Exclusive Buyer Agents" that represent only the buyers interest .