Is Dual Agency for You?

Looking to buy or sell a house? If you're like 90% of North Americans that will mean you will working with a real estate agent. In real estate there are buyers and sellers; both commonly have agents working for them (single agency). Part of any agent's responsibility to their clients, called their fiduciary responsibility, is to try to get the best deal possible for that client. In other words, the seller's agent tries to get the highest price possible for the property, while the buyer's agent wants to negotiate the lowest possible sale price for the house.

However with dual agency a single agent acts for both the buyer and the seller in a transaction. Because of the obvious conflict of interest (an agent just cannot get the highest price for the seller and the lowest price for the buyer at the same time), a number of states don't allow dual agency. In others, dual agency is an accepted business practice.

Dual agency is confusing

Dual agency can be confusing and it's important to understand that dual agency doesn't refer to the actual real estate agent, but to the real estate broker or brokerage itself. For example, if Betty Backdoor who is an agent of ABC brokerage shows you a home listed by ABC Brokerage through their agent Freddie Frontdoor the brokerage is in a position of dual agency even though there are two different agents working on the deal. By law, when this situation occurs a dual agent has the responsibility to disclose the dual agency relationship to you and all interested parties.

How should you deal with dual agency?

Dual agency is not an uncommon occurrence and lots of homes are bought and sold under dual agency. If you find yourself in a dual agency situation you've got a couple of choices:

  • You can walk away from the property and look for one that isn't represented through dual agency
  • You can opt to accept the dual agency. In this case you should be asked to sign an agreement stating that you are aware of the dual agency situation and agreeing to allow the agent to act for you.

Before you agree to buy or sell under a dual agency agreement, here are some thoughts on how you can protect yourself:

  • Talk to your agent to find out his or her dual agency policy. One common approach is through 'designated agency' or an 'intra company agent'. In this situation two agents from the brokerage are designated to act for the interested parties--one to act for the buyer and one to act for the seller. In this way both the buyer and seller are represented while the broker still fulfills his/her fiduciary responsibility to get the best deal for each party.
  • Talk with some of the agent's past clients who worked with them under dual agency. Find out if the clients felt they were treated fairly during the transaction, whether the agent fully explained their role early in the process, were they happy with the outcome of the deal and perhaps most importantly, would the client recommend this agent to a good friend.
  • Make it a point to educate yourself about recent sale prices of comparable homes in the area. This information is available to all agents and they should readily share it with you.

In spite of the appearance of a conflict of interest, dual agency isn't necessarily bad. Thousands of homes are sold to satisfied customers under dual agency every year. In a fast-moving market where houses are sometimes sold before they even get listed, it could the only way to buy a house. However, if you feel your interests can't be represented and protected under dual agency, you can always walk away. You can look at other properties or you could sign with an exclusive buyer's or seller's agent - an agent who will definitely have only your interests at heart.

Need more information on Listing and Selling Agents?

How to find a good realtor:


Murray Anderson is an experienced freelance writer with over numerous articles published on the web as well as in print magazines and newspapers in both the United States and Canada. He writes on a wide range of topics, but specializes in home-related topics.

Featured Articles