What is Exclusive Buyer Agency?
An Exclusive Buyer Agent (or EBA) is a real estate firm (or an agent or broker who works in such a company) which represents only buyers of real estate. As such, they are distinguished from all other real estate firms by their business model of 100% buyer representation. EBA firms never take listings and, therefore, never represent the seller in a real estate transaction.
History
The EBA movement started in the late 1980s in the United States and, by the early 1990s as with the rise of Buyer Agency in general in US states, firms came into being and a national trade association, the National Association of Exclusive Buyer Agents (NAEBA), was formed. As of 2008, EBA firms offer service to buyers in almost all 50 states.
Ordinary real estate firms in the US and Canada can represent both buyers and sellers in the same transaction, and when representing both, derive profit from both the seller and buyer side of the transaction. While some areas have, at the insistence of real estate trade groups, created various forms of Dual Agency to allow one company (but not one agent) to represent both sides, other jurisdictions have continued to hold such practices as illegal. In the opinion of EBAs, it is not possible to faithfully represent clients with opposing interests simultaneously.
Method of Exclusive Service
The service structure for EBA real estate practitioners is to show buyers all possible listings from other cooperating brokers as well as all other sources, such as for sale by owners. Then, they assist the buyer with evaluation and negotiation and advocate in the buyer's best interests without restriction.
EBA firms amount to less than half of 1% of all real estate firms in the US and Canada. The EBA business model of unconflicted buyer representation eliminates the possibility of the buyer being confronted with the conflicts of interest which may be associated with the Dual, Limited or Designated Agency business models.
Today
In recent years, real estate brokerages have made an intentional shift in their business models so an individual real estate associate can act for a buyer. Last year, RECA, who regulates the real estate profession in Alberta, made a mandatory change requiring the use of a Buyer Brokerage Agreement when these associates are acting for the buyer.
What these changes and regulations have failed to do is prevent the associates from offering you full service one day and then advising you the next that "things have changed" and they now are working as a designated or transactional agent. That is because the changes still allow brokerages to take advantage of the lucrative dual agency business, while making consumers more comfortable with the conflict of interest.
Exclusive Buyer Agents only work with buyers. Their full representation is always to the buyer.
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