Can the Same Real Estate Broker Work With the Buyer and Seller in New Mexico?

It’s a question I get fairly often, usually when I’m listing a property and meet a buyer who isn’t already working with another broker:

“Can you work with us, too?”

In New Mexico, the answer is yes.

The same transaction broker can provide real estate services to both the buyer and seller in the same transaction. It’s a fairly common arrangement here, and one that sometimes surprises people who have bought or sold real estate in other states.

The next question is usually some version of:

“But how can you work for both sides?”

It’s a fair question. And the answer has a lot to do with how real estate brokerage works in New Mexico.

A Quick Refresher on Transaction Brokerage

We wrote previously about the sometimes-confusing differences between an agent, broker, transaction broker and REALTOR®. The short version is that New Mexico is a brokerage state, and most residential brokerage relationships here are established as transaction brokerage.

That applies to both buyers and sellers.

A transaction broker can provide a pretty comprehensive range of services. We advise clients, prepare contracts, provide market information, negotiate, coordinate inspections and due diligence, help solve problems and guide transactions through closing.

But transaction brokerage is not a traditional fiduciary agency relationship.

That distinction is especially important when one broker is providing services to both sides of a transaction.

So How Can One Broker Work With Both Sides?

The easiest way to understand it is that my responsibilities don’t disappear because I’m working with both parties.

Quite the opposite.

As a transaction broker, I have duties that apply to the people I’m working with. Those include honesty, reasonable care, compliance with our written agreements, disclosure of certain information and conflicts, and protection of confidential information.

If I’m providing services to both buyer and seller, I still have those responsibilities.

What changes is that I have to be particularly careful about the line between information that should be disclosed and information that must remain confidential.

That’s really the heart of it.

What Does That Look Like in Practice?

Let’s say I list a home in Santa Fe.

An unrepresented buyer sees the property, loves it, and wants to make an offer. They’re comfortable working with me, the seller is comfortable with the arrangement, and I agree to provide transaction-broker services to the buyer as well.

At that point, I know quite a bit about both sides of the transaction.

That can actually be useful. I know the property, its history and the issues that may be important. I understand the seller’s priorities. I’m now also learning what matters to the buyer. And because I’m directly involved with everyone, communication can be remarkably efficient.

But there are very clear boundaries around what I can do with that information.

Suppose the seller has privately told me:

“We’d accept substantially less than asking if we had to.”

I don’t get to tell the buyer that.

Or suppose the buyer tells me:

“We’re offering $900,000, but if they counter, we’d actually go as high as $950,000.”

I don’t get to tell the seller that either.

Those are exactly the kinds of confidential details a broker has a duty to protect.

Working with both sides doesn’t turn private information into shared information.

But Can You Still Help Both Sides Negotiate?

Absolutely.

This is probably the biggest misconception about having one broker involved with both sides.

I don’t suddenly become a glorified courier whose only job is to carry documents back and forth.

I can explain contracts and customary practices. I can provide relevant market information. I can help a buyer understand the implications of different offer terms. I can help a seller evaluate an offer. I can prepare and present offers and counteroffers. I can identify issues that need to be addressed and help the parties find ways to address them.

And I can negotiate.

What I cannot do is use one party’s confidential information as leverage for the other.

That’s an important distinction.

A lot of good real estate negotiation isn’t about possessing some secret piece of information anyway. It’s about understanding the market, knowing the contract, recognizing what matters to the people involved, anticipating problems and finding terms that can get everyone where they ultimately want to go.

Aren’t the Buyer and Seller’s Interests Opposed?

Sometimes they are.

The most obvious example is price. The seller would generally prefer a higher number. The buyer would generally prefer a lower one.

But a real estate transaction involves far more than price.

Closing date, financing, appraisal, inspections, repairs, personal property, contingencies, possession and dozens of smaller details can all become part of a negotiation.

And while the buyer and seller certainly have different interests, they also share one very important objective:

If they’ve entered into a contract, they both want the transaction to work.

My job isn’t to decide what outcome either party should accept. My job is to give people the information and professional guidance I’m permitted to provide, protect the information I’m required to keep confidential, explain their options and help them carry out the decisions they make.

That’s entirely possible to do for both sides of a transaction.

There Can Actually Be Some Advantages

One broker working with both parties can make for a very efficient transaction.

Communication is the obvious one.

In a conventional transaction, a question may travel from the seller to the seller’s broker, then to the buyer’s broker, then to the buyer — and the answer travels all the way back again.

When I’m working with both parties, I can often get a question answered with a phone call.

There’s also one person who has context for the entire transaction.

That can become particularly useful once you’re under contract.

Real estate transactions have a way of producing unexpected problems. An inspection uncovers something nobody anticipated. A lender needs a document immediately. An appraisal raises a question. A repair needs to be negotiated. Someone interprets a contract provision differently than expected.

Having one experienced broker who understands the property, the contract, the history of the transaction and the people involved can sometimes make those problems considerably easier to solve.

Does That Mean One Broker Is Always Better Than Two?

Not at all.

There are plenty of transactions where having separate brokers makes sense.

A buyer may already have a broker they know and trust. A transaction may be particularly complicated. The parties may have very different communication styles. Negotiations may become contentious. Or one of the parties may simply be more comfortable having a separate broker.

There’s nothing wrong with that.

Likewise, there’s nothing inherently problematic about one broker providing services to both parties.

The question is whether everyone understands the relationship, is comfortable with it, and trusts the broker to maintain the professional boundaries the arrangement requires.

Why Does This Surprise People From Other States?

Because real estate brokerage law varies considerably from state to state.

The rules governing how brokers can work with buyers and sellers — and whether the same real estate professional can provide services to both — aren’t uniform across the country.

Some states structure brokerage relationships very differently from New Mexico. Some place much greater restrictions on one real estate professional working with both parties in the same transaction.

So someone moving to Santa Fe may have been told during their last home purchase that the person listing the property absolutely could not also work with them as the buyer.

Then they get here and discover that it happens with some regularity.

Neither experience is necessarily contradictory. They’re simply different regulatory systems.

And New Mexico’s transaction-broker model is specifically structured to allow a broker to provide professional real estate services without creating the traditional fiduciary relationship that people often associate with the word “agent.”

What Should You Ask Before Agreeing to It?

If you’re considering working with a broker who is also providing services to the other party, I think you should ask questions.

Make sure you understand the relationship.

Ask what the broker can and cannot disclose. Ask how confidential information will be handled. Ask what kind of advice the broker can provide. Ask how negotiations will work. And if there’s anything about the arrangement that makes you uncomfortable, say so.

None of this should be mysterious.

A broker working with both parties should be able to explain the arrangement clearly and tell you where the boundaries are.

The Part That Matters Most

For me, this comes down to professionalism and trust.

I’m perfectly comfortable providing transaction-broker services to both a buyer and seller in the same transaction.

That doesn’t mean I forget which information came from whom. It doesn’t mean confidential conversations suddenly become fair game. And it certainly doesn’t mean either party gets a lower standard of service.

It means I need to be disciplined about my responsibilities to both.

I protect confidential information. I disclose what I’m required to disclose. I give both parties the information and guidance I’m permitted to give them. I communicate clearly. I help solve problems. And I work hard to get everyone from contract to closing.

Sometimes there are two brokers involved in doing that.

Sometimes there’s one.

Either arrangement can work extremely well.

Have questions about working with the same broker as the buyer or seller on the other side — or about transaction brokerage in New Mexico generally? Contact us at FORM Santa Fe. We’re always happy to explain how it works and help you decide what makes sense for your situation.