Bypassing the Listing Agent to Contact the Seller Directly — When Industry Order Breaks Down

At an industry association networking event, a veteran broker of my generation said something that stuck with me: “This industry is full of people with no manners. The moment they get hold of property information, they go straight to the seller. It’s not even rare.”

That’s why, he explained, he only shares information among a closed circle of agents he trusts to play by the rules. The fact that I receive those leads apparently means I’ve been classified as one of the “honest ones.” His sales team has taken to calling me the “straight-arrow contact.”

Going around the listing agent to contact the seller directly — in Japan’s real estate industry, this is known as “tobashi” (飛ばし), literally “skipping over.” Every broker knows it’s a cardinal sin, and it strikes at the foundation of trust that makes the industry function.

Listing Agent and Buyer’s Agent — How Roles Work in Japanese Real Estate

Real estate brokerage in Japan involves two distinct roles.

The listing agent (motodzuke, 元付業者). This is the firm that takes the seller’s mandate to sell the property. They handle appraisals, marketing, contract negotiations — everything on the seller’s side. In industry shorthand, they’re called “motomoto” (物元), meaning the agent who “holds the source” of the property.

The buyer’s agent (kyakudzuke, 客付業者). This firm represents the buyer. They introduce properties, arrange financing, and negotiate terms. Crucially, the buyer’s agent conducts all dealings through the listing agent — never directly with the seller.

This is the fundamental rule. The listing agent serves as the single point of contact with the seller, and the buyer’s agent works through that channel. The listing agent receives a commission from the seller; the buyer’s agent receives a commission from the buyer. This structure is what makes it safe to share property information across firms.

What “Tobashi” Means

Tobashi means “skipping” the listing agent to contact the seller directly.

Why would an agent do this? The answer is simple. By cutting out the listing agent and positioning themselves on the seller’s side as well, they can collect commissions from both buyer and seller. This is dual agency (両手仲介, ryoute chuukai).

Japan’s real estate industry has what practitioners call the “three cardinal sins”: nuki (抜き行為, poaching a client already under an exclusive brokerage agreement), kakoi-komi (囲い込み, information hoarding — when a listing agent refuses to share property details with other firms), and tobashi (bypassing). All three undermine the trust structure that brokerage depends on. Anyone who intends to build a career in this industry knows to stay away from all of them.

The Lure of Massive Commissions — What Happens on a ¥1 Billion Deal

To understand the incentive behind tobashi, look at the absolute numbers.

Japan’s Real Estate Brokerage Act (宅建業法) caps brokerage commissions at “sale price × 3% + ¥60,000 + consumption tax.” Compare the single-side commission (from buyer or seller only) with dual agency (from both):

• ¥100 million property (approx. $670K) — Single: ~¥3.37M / Dual: ~¥6.73M
• ¥500 million property (approx. $3.3M) — Single: ~¥15.18M / Dual: ~¥30.36M
• ¥1 billion property (approx. $6.7M) — Single: ~¥30.36M / Dual: ~¥60.72M

Dual agency on a ¥1 billion deal yields roughly ¥60 million (approx. $400K). Some agents decide that number is worth destroying another firm’s deal to get.

“I can save you on commissions” — that’s the pitch to the seller. The bypassing agent offers to handle both sides for a reduced fee, saving the seller the cost of their current listing agent. From the seller’s perspective, if the property sells at the same price, lower fees sound rational. It’s a compelling argument on the surface.

What Happened at an Information Exchange Meeting

Here’s a story from an industry group’s information exchange session.

At these gatherings, participating brokers bring off-market property information and share it on the basis of mutual trust. This is information that isn’t on REINS (Real Estate Information Network System, Japan’s MLS equivalent) — or hasn’t been listed yet. The unwritten rule is that you never use information shared at these meetings to bypass the listing agent. That’s the minimum standard of conduct, and it’s the very premise that makes these meetings possible.

Yet after one such meeting, an agent took the off-market information that had been shared and went directly to the seller. I remember one of our sales staff reporting the incident with visible exasperation.

At the time, I was newly licensed and didn’t fully grasp the gravity of what had happened. I thought, “I guess that kind of thing occurs.” Looking back, though, what it meant was that someone in that room had no qualms about betraying the trust of everyone present. Whether they didn’t understand the purpose of the meeting or understood it perfectly but couldn’t resist the commission — either way, there’s no excuse.

Now I understand exactly why the veteran broker I mentioned at the beginning said he only shares information among agents he trusts. If you share information and the other party uses it to bypass you, that’s the last time they’ll ever hear from you. Self-preservation is the only option.

REINS Rules and Legal Risks

The regulatory framework around bypassing operates on two levels: industry rules and civil law.

REINS rules. REINS regulations prohibit contacting a seller without the listing agent’s consent. Violations can result in warnings, reprimands, or suspension from the system if a sale results from the bypass. However, the severity of penalties varies by regional REINS organization and membership category. And frankly, for agents who primarily deal in off-market properties, losing REINS access is hardly a deterrent. I myself rarely use REINS. It’s hard to imagine that agents who engage in bypassing are dependent on it.

Real Estate Brokerage Act (宅建業法). There is no provision that explicitly prohibits bypassing. However, depending on how the contact is made, other provisions — such as prohibitions on improper solicitation — may apply.

Civil liability. This is where the real teeth are. A bypassed listing agent has two main grounds for legal action.

The first is a commission claim. Under Article 130 of Japan’s Civil Code (obstruction of condition fulfillment, 民法130条), the bypassed agent can argue that brokerage should be deemed successful and claim their agreed commission. The leading case is a 1970 Supreme Court decision (October 22, Showa 45) that recognized a broker’s right to commission when they were excluded from a transaction, treating the brokerage condition as fulfilled.

The second is a tort claim for damages. In a 2013 Tokyo District Court decision (July 3, Heisei 25), a buyer conspired with another agent to exclude the listing agent. The court awarded 80% of the 3% deemed commission plus additional tort damages.

In other words, even a “successful” bypass carries the ongoing risk of commission claims and damage suits from the excluded listing agent. The reason bypassing persists despite these risks is that some agents calculate the potential commission outweighs the legal exposure.

How Bypassing Destroys Transactions — and Markets

The damage from bypassing extends far beyond the parties directly involved. It creates a vicious cycle that erodes information flow across the entire industry.

Collapse of trust. When trust between listing and buyer’s agents breaks down, information sharing becomes impossible. The veteran broker’s policy of “sharing only with honest agents” is the direct consequence.

Failed and delayed transactions. If the listing agent discovers the bypass, they will resist. Negotiations break down, and the deal itself often falls apart. The result is that both seller and buyer end up worse off.

Declining information quality. When bypassing is widespread, listing agents become reluctant to register properties on REINS as a form of self-defense. This feeds into information hoarding (囲い込み). When information stops flowing, the entire market loses transparency.

Risk to buyers. Without the listing agent’s involvement, critical property information — title encumbrances, hidden defects, neighborhood dispute history — may never reach the buyer. The listing agent knows the property best. Cutting them out means cutting off a vital information source.

When the Rules Break Down

The higher the property value, the greater the incentive to bypass.

Dual agency on a ¥1 billion property yields roughly ¥66 million (approx. $440K). Some agents treat REINS penalties and civil litigation risk as acceptable “costs of doing business” that are more than offset by the commission. In the ultra-high-end segment, where transaction volumes are low and oversight is limited, the temptation is even greater.

Since the Real Estate Brokerage Act contains no explicit prohibition, the threshold for regulatory action is high. REINS penalties exist, but agents whose primary business is off-market properties are essentially immune to them. The reality is that institutional deterrence has its limits.

What actually restrains bypassing is not law or regulation, but reputation — an invisible asset built within the industry. The veteran broker’s words — “I only share with honest agents” — reflect both resignation toward the system and a quiet determination to preserve order despite it.

Articles on this site are based on hands-on industry experience and are not intended as individual investment advice.