What is Dual Agency and Why is It Important?

by | May 1, 2020 | Real Estate Glossary

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What is dual agency?

In a standard real estate transaction, there is a buyer’s agent that represents the buyer and also a listing agent that represents the seller. In real estate, dual agency is a situation in which a real estate agent simultaneously represents the buyer and also represents the seller. Most people understand the benefits of hiring a real estate agent. You get professional representation in fighting for your best interest when helping you meet your real estate goals. However, when you hear the term dual agent (also known as a transaction broker), they are essentially representing both the buyer and the seller. Several situations can arise in which you may find yourself represented in a dual agency relationship.

1.) Dual agency can happen when both the listing agent and the buyers agent work for the same brokerage. 

For example, if Debbie works for John Smith brokerage and lists a home on Main Street. Another agent, Harry, also works for John Smith brokerage and represents a buyer in the transaction. The company benefits from both ends of the deal and is therefore a dual agency.

2.) Your listing agent finds you a buyer but is also hired to sell the buyers home.

Let’s say you are selling your home with your real estate agent and they find you a buyer. However, that buyer needs to sell their home first before they can officially purchase yours. If that buyer hired your listing agent to sell their existing home so that they can then buy yours, that would establish a dual agency relationship.

3.) Buying a home listed by your real estate agent

This can happen if the home you fall in love with just so happens to be listed by your own real estate agent that you have already hired. This is more likely to happen in a smaller town where there are fewer real estate agents to choose from.

4.) Unrepresented buyer approaches your agent

In this example, let’s say your listing agent is hosting an open house to show potential buyers your home in person. If an interested person comes by and does not have a real estate agent, they may want to hire your real estate agent to represent them.

Pros and cons of dual agency

Like anything, being represented in a dual agency relationship in your real estate transaction has its pros and cons. Below is a list of a few that you might want to consider when determining if dual agency is the best choice for you.


  • Better Communication: Since dual agency is one real estate agent or a brokerage that is representing the buyer and seller, the agent doesn’t need to get held up by communication between separate parties. Streamlined communication will create a smoother transaction because one agent is in charge of both sides of the process. That includes the paperwork, schedules and deadlines. Transactions can be compromised by an agent on another side that isn’t punctual with their responses and this can be avoided in a dual agency relationship.
  • Full disclosure: You will always know if you are entering a dual agency relationship with your real estate agent because by law, it must be fully disclosed to both the buyer and the seller.
  • Access to more buyers: When you are selling your home, a dual agency agreement can give you access to more buyers than if you declined the ability to fall into a dual agency agreement. For example, since a dual agency can happen when there are two different agents working for the same brokerage, you would want to ensure that your agents’ co-workers could send buyers to your home. If you declined the possibility of a dual agency, you would be limiting your buyer reach because your agents’ co-workers wouldn’t be able to show your property to their pool of buyers.
  • Save money: In a traditional real estate transaction, a home seller pays a commission to their listing agent, who then splits the commission with the buyer’s agent. In a dual agency, that agent is usually the same person and negotiating the commission fee might be easier to do. In theory, there is less time spent on the transaction so you can argue the agent should make slightly less. Additionally, there are several companies out there that allow clients to pay less commission or simply a flat fee to sell their home, Trelora being one of them. This can save a substantial amount of money on the transaction, regardless of whether a dual agency relationship is established.


  • Less advice: Since a dual agency relationship presents a potential conflict of interest situation, the agent can’t really take one side or give advice to another. This is because they are representing the seller, who wants to get as high of a price as possible, while their other client, the buyer, wants to pay as little as possible. Rather, that agent in a dual agency relationship simply mediates the transaction and is basically just a transaction broker.
  • Attention to detail: When there is only one agent representing an entire transaction, there are more chances of them overlooking something that might be important, presenting a situation where there are no checks and balances. It’s always better to have multiple professionals’ eyes on the transaction ensuring that everything is going smoothly.
  • Confusion: If you are a first time home buyer or selling your first home, you will not get as much advice as you would in a standard real estate agent relationship which may cause confusion to people new to real estate. This is due to the established laws and potential conflict of interest that can occur in a dual agency agreement.

As with anything, there are pros and cons to allowing a dual agency relationship to be involved in your real estate transaction. It’s best to be informed and consider how this scenario can negatively or positively impact the outcome of your next real estate transaction.

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