Navigating Dual Agency in Real Estate: Understanding the Role of the Agent and Potential Conflicts of Interest

Dual agency is a term used in the real estate industry to describe a situation in which a real estate agent represents both the buyer and the seller in a transaction. This is also known as a "double-ended deal." It is a legal and common practice in many states but it is important to understand the role of the agent and the potential conflicts of interest that may arise during the process.

In a dual agency situation, the agent must disclose their role as a dual agent to both parties, and they must obtain written consent from both parties before proceeding. The agent must also inform the parties of their right to seek representation from another agent.

When acting as a dual agent, the agent is required to be neutral and to treat both parties fairly. They are not allowed to disclose any confidential information about one party to the other without the party's consent. They also cannot provide advice or opinions on price, terms, or conditions of the sale.

One of the main potential conflicts of interest in a dual agency situation is that the agent's commission is typically paid by the seller, and the agent may have an incentive to get the highest price possible for the seller, which may not be in the best interest of the buyer.

It is important for buyers and sellers to be aware of the potential conflicts of interest that can arise in a dual agency situation. If you are unsure about the role of the agent in a transaction or have concerns, it is recommended to seek representation from another agent or a lawyer to ensure that your interests are protected.

In conclusion, dual agency is a legal practice in real estate, however, it is important to be aware of the potential conflicts of interest that may arise during the process, and to seek representation if you have any concerns.