Dual Agency: Can Agents Represent Both the Buyer and Seller

Dual Agency: Can Agents Represent Both the Buyer and Seller

Using an agent tends to make real estate transactions a lot easier. That's because most real estate agents are licensed professionals who are knowledgeable in their field. Not only that, but hiring an agent is like hiring your own personal advocate who has your best interests in mind when buying or selling your home.

However, there is a practice known as dual agency, where an agent represents both the buyer and the seller in a transaction. This raises questions about conflicts of interest and fairness.

In this article, we will explore the concept of dual agency, its implications, and its legality in different states.

The Role of Real Estate Agents

To understand dual agency, let's first explore the traditional roles of real estate agents. Typically, an agent works exclusively with the buyer or the seller, advocating for their respective interests throughout the transaction. This arrangement ensures that the agent can provide undivided loyalty and prioritize the best outcome for their client.

What Is Dual Agency?

Dual agency happens when a single real estate agent or broker represents both the buyer and the seller in a transaction. In other words, the agent acts as an intermediary, working on behalf of both parties involved in selling or purchasing a property. This means that the agent must simultaneously represent the interests of the buyer and seller.

When a single agent or broker assumes the role of representing both parties, they have access to confidential information from both the buyer and the seller, including their financial circumstances, motivations, and any other details relevant to the sale.

Dual agency can occur when a buyer who is already working with an agent decides to purchase a property listed by that same agent or their brokerage. It can also happen when a seller who is already working with an agent decides to accept an offer from a buyer represented by that same agent or brokerage.

Who Pays the Commission in a Dual Agency Situation?

In most home sales, the commission is usually paid for by the seller. However, in dual agency scenarios, where the agent represents both the buyer and the seller, the terms of the commission payment should be negotiated and clarified amongst the parties involved. In some cases, the agent may negotiate a modified commission structure or have separate agreements with each party. It's important for everyone involved to understand the financial arrangements in a dual agency situation before agreeing to them.

Is Dual Agency Illegal in Some States?

To address some of the challenges posed by dual agency, some states have implemented specific regulations. While dual agency is not inherently illegal in most states, it is heavily regulated to protect the interests of buyers and sellers. Several states require agents to disclose their dual agency status and obtain informed consent from both parties before proceeding. This ensures that buyers and sellers are fully aware of the potential conflicts of interest and can make informed decisions about their representation.

However, it's important to note that dual agency is, in fact, illegal in eight states. Those states include:

  • Alaska
  • Colorado
  • Florida
  • Kansas
  • Maryland
  • Texas
  • Vermont
  • Wyoming

Benefits of Dual Agency

While there are some concerns associated with dual agency in real estate, some people argue that there can be certain advantages to this practice. Here are a few potential benefits that some people may associate with dual agency:

Better Communication

With a single agent representing both the buyer and the seller, communication can be more efficient and streamlined. There is no need for multiple agents to relay information between parties, potentially reducing the chances of miscommunication or delays.

More Knowledge of the Transaction

Dual agents have comprehensive knowledge of both sides of the transaction. This can provide them with a deeper understanding of the motivations, priorities, and specific needs of both the buyer and the seller. This in-depth understanding may help the agent navigate negotiations more effectively.


For clients who prefer a more centralized approach, dual agency can offer convenience and flexibility. Dealing with one agent instead of multiple parties can simplify the process and potentially expedite decision-making.

Potential Conflicts of Dual Agency

While some may argue that working with a dual agent can make a real estate transaction easier, there are others who believe that there are too many disadvantages due to the inherent conflicts of interest and potential challenges in maintaining impartiality. Here are some of the problems that can arise with dual agency:

Limited Loyalty and Advocacy

A dual agent's primary responsibility is to both the buyer and the seller, which can compromise their ability to provide undivided loyalty and dedicated advocacy to either party. They may struggle to negotiate the best deal for their client when their loyalty is divided.

Potential for Biased Advice

Dual agents may face challenges in providing unbiased advice to both the buyer and the seller. Their recommendations may be influenced by their desire to maintain a balanced position or avoid favoring one party over the other, which can result in advice that is not necessarily in the best interest of either party.

Conflicts of Interest

Dual agents have access to confidential information from both the buyer and the seller, which can create conflicts of interest. They may be privy to information that, if disclosed, could benefit one party at the expense of the other. This can raise concerns about the agent's ability to negotiate effectively and maintain the highest level of integrity.

Limited Negotiation Leverage

In a dual agency situation, the agent is often aware of the buyer's and seller's motivations, financial circumstances, and other sensitive information. This knowledge can limit the agent's ability to negotiate the best terms for their client, as they may need to balance the interests of both parties, potentially leading to compromises that may not be optimal for either party.

Limited Accountability

In a dual agency arrangement, it may be more challenging to hold the agent accountable for any lapses or errors in their representation. When an agent is solely dedicated to one party, it is clearer where the responsibility lies in case of any issues. However, in dual agency, the lines of accountability can become blurred.

It's important to note that these situations don't always happen in dual agency situations. Some agents may be great at managing potential conflicts and are able to provide fair representation to both parties. However, it is crucial for buyers and sellers to carefully consider the implications and potential drawbacks before choosing to work with a dual agent.

At the end of the day, it's up to the potential client whether they're okay working with a dual agent when buying or selling a home. They might find convenience in working with someone who has all of the information or will want to work with someone who is committed to them and only them. As long as there's transparency, they'll be able to make their own informed decisions for the smoothest real estate sale possible.  

Ready to get your real estate license? Start by choosing your state on our website to start your real estate journey with VanEd. Enroll today!

Written and Published by: VanEd

Similar Posts

100,000+ Students Since 1997
24/7 Online Course Access