Why Shouldn’t I Call the Listing Agent On a Space?

One of the most common mistakes tenants make when looking for real estate for their practice is contacting a listing broker for information and then inadvertently beginning to work directly with the listing agent or owner. This can be a costly mistake because healthcare providers typically do not understand the dynamics of the relationships involved.

The listing agent has a fiduciary relationship with the property owner. This term might sound like legal jargon because it is. The listing agent is required to work on behalf of the landlord or seller in the transaction. This agreement places the listing agent on the opposite side of the table from you. They are effectively working against you in the transaction, particularly concerning high-dollar business terms that can cost or benefit you by tens or even hundreds of thousands of dollars. Your interests conflict with their legal obligation to help the owner maximize profit, and their real estate license is at stake.  Simply put, the listing agent’s responsibility is to find a tenant and, in the process, help their client—the landlord or seller—make as much money as possible. They are not working on your behalf, trying to help you find the best location for your practice, or assisting you in capitalizing financially on the negotiations.

During the initial phone call about a property, the listing agent evaluates your posture within the deal. Your tone, level of interest, and experience all come into play. Any perceived weakness or inexperience can and will be used against you as a prospective tenant as the deal unfolds.

That might seem extreme, but you must understand that the property you are interested in is the means by which the seller or landlord provides for their family. And it’s hard to blame them. Put yourself in their shoes. If you knew your house was worth $400,000 but someone was willing to pay you $500,000, wouldn’t you take it? Of course, you would! The definition of a ‘fair market deal’ can be boiled down to what a property is worth to a potential end user.

If you approach a property with the wrong posture, it can end up costing you tens or even hundreds of thousands of dollars in the transaction.

“But what is the solution?” We’re glad you asked!

In the same document that the seller or landlord signed with the listing broker to create the fiduciary relationship, the landlord also agreed to pay commissions. Those commissions are paid whether you have an agent or not. If you bring an agent to the table, the listing agent will split the commission with your agent. If you approach the transaction without an agent, the listing agent keeps the full fee and, in most scenarios, earns a double commission.

At the end of the day, you are not saving money by coming to a transaction unrepresented. Without representation, you lose the benefit of an expert advisor who has a legal obligation to protect your interests. They will work tirelessly to save you time, energy, and help you avoid costly pitfalls and complications. Failing to understand your value within the market could easily cost you six figures.