In the past, real estate agents almost always worked for, and were paid by, the seller of the property. Even agents who brought a buyer to another agent’s listing were considered subagents of the seller. Agents and subagents alike owed a fiduciary allegiance to the sellers, meaning that they would serve them with “confidentiality, loyalty, obedience, accounting, disclosure and diligence.” Buyers, on the other hand, traditionally had no legal representation whatsoever. Sellers were the clients. Buyers were the customers.

That system had potential problems, both legally and ethically. First of all, the seller could be faced with liability if the subagent - whom the seller might not even have met, but who was supposedly working for him or her – should misrepresent the property. Secondly, although a buyer might assume that a traditional agent is looking out for his or her best interest, that is not actually the case. The fiduciary responsibility of the agent, after all, is to the seller. And although that disclosure was often made to the buyer, sometimes it was not, leaving the buyer uninformed regarding his or her representation. The buyer might not realize that, as a fiduciary agent of the seller, an agent can offer no advice on how much to offer and is prohibited from giving his or her true opinion about the property to the buyer if that opinion is detrimental to the seller.

Within the last decade, buyers came to realize that the system was one-sided and began to demand equal representation. As a result, the real estate industry began to make a major paradigm shift to protect the buyer in his or her attempt to make an informed choice. “Seller agency” was no longer the only agency relationship available. New types of agency began to develop. Depending on local legislation in different parts of the country, agents might be “transactional agents” (offering no allegiance at all, just helping put a sale together),” non-agents” (offering no allegiance), “dual agents” (attempting to give allegiance to both parties at the same time), or “buyer agents” (offering allegiance to the buyers only).

Today, prior to showing property to prospective buyers, real state agents are required by law to explain agency relationships and discuss the choices that a buyer has. In NH those choices are: Buyer Agency – the agent represents the buyer; Seller Agency – where the agent represents the seller; Sub-agency – the agent represents the seller on a co-broke; or Disclosed Dual Agency – it’s impossible to represent the buyer and the seller at the same time. (The possibility of dual agency exists when an office takes listings and also tries to represent buyers. When a buyer-client wants to buy an office listing, the office has a dual agency. )

Of all these agency relationships, Buyer Agency is the only one that offers 100% representation to the buyer.