DUAL AGENCY: What It Is and Why You Should

dual agency
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There are states in the US that outlawed the practice of dual agency such as Florida. However, some still allow it within its localities despite the complexities around the practice. As much as the dual agency streamlines communication between sellers and buyers in real estate, there are still certain truths you ought to know about this practice.

What Is a Dual Agency in Real Estate?

The dual agency is a term used when an agent works for both the buyer and the seller in closing a real estate deal. It is also used when a landlord and the tenant work with the same real estate agent, or company. Dual agency means an agent notably represents the two contracting parties in clarifying interests and meeting their objectives. The term is not rampantly practiced because people believe there may be a conflict of interest when this happens. So to avoid the assumed conflict of interest, most clients will opt to work with different agents than using one agent to negotiate on both sides of a real estate deal. It is also not allowed in every state, however, some still permit its practice within their municipals.

How Does Dual Agency Work?

Clients who desire to use dual agency rather than single party agent, clearly understand what they are getting into. Due to the technicalities involved, the agent usually demands the two parties whose interests will be represented to sign an official disclosure from the state department of real estate. Because it is not accepted in some states, agents are extremely careful when representing two parties as a dual agency in real estate. With the signed document, the agent proceed to work on the different interests of both parties. 

What Causes Dual Agency?

Below are the seeming situations that cause dual agency in real estate.

#1. Online Listing

One notable cause of online listing is when a buyer wants to buy a house and already contacted an agent to help out in the buying process. While on it, you come across a house listed online and desired to buy it not knowing it was listed by the same agent you contacted to help your purchase process. In most cases, the buyer can get another agent to represent him. However, there are rare situations in which the buyer decides to process the transaction. However, this will only take place if dual agency is allowed in the state.

#2. Open House

Agents are the ones who host open house viewing for sellers. thereby representing them. In the course of this, they get the names and contact of people who want to buy the house from their register. There are times when a potential buyer who keeps close touch with the agent in question can opt to use the same agent to represent them when buying the house.

#3. Newly Constructed Site

To buy a just-concluded home, you have to go to the sales office and talk to agents who work for the seller. Over time, a relationship is built. This connection may not be obvious to people who want to buy a house. But the relationship built with the agent over time makes them decide to work with the same agent.

Who Benefits From a Dual Agency?

All the parties involved benefit from it. The seller and the buyer enjoy the ease of communication and speed with which the transaction runs. And the dual agent also gets the agency fee from both sides. However, the agent has more benefits compared to both the seller and the buyer. Although it may be hard for them to keep up with their agent responsibilities and their fiduciary duty to both parties, they still get rewarded for both jobs. Also, working on both ends hasten the entire process. 

State That Does Not Permit Dual Agency

In real estate, the dual agency is not practicable in all states and is deemed illegal where it is not accepted. . Some of the states that do not allow the dual agency include the following; 

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

Arguments for and Against the Dual Agency in Real Estate

Some real estate professionals and consumer advocates insist an agent should never work for two people at the same time. They aren’t sure if a dual agent can be truly impartial when they work for both the buyer and the seller in a deal. That’s mostly because the seller will want to get the most money for their home, and the buyer will want to pay the least. There are several arguments against the practice of dual agency in real estate. That explains why it is not permissible in some states. 

The most common argument is based on the varying interest of the seller and the buyer. While a seller wants his property sold at the highest price possible, the buyer would want to buy it at the lowest price possible. As a result, people doubt the possibility of a dual agent being truly impartial when working for both the buyer and the seller in a deal.

The second argument says that dual agency isn’t a big deal and can even help both parties by speeding up communication. When communication is strengthened, the deal is bound to close in a faster space.

Agents’ Responsibility in Dual Agency

It is the sole responsibility of the agent to ensure that both the seller and the buyer get to know he will be representing both of them. An agent will also have to ensure he gets the two parties to sign the official disclosure from the state department of real estate. This will serve to prove he is not trying to play both parties. 

How Can Buyers Avoid Dual Agency?

Since the dual agency is not allowed in every state, it may likely not be available in yours too. Moreover, there is no specified law that compels agents to use the oral or written format in informing the parties involved they would be representing them both, it is better to be careful from the onset. If you would not like this in any way, then you have to ask your agent from the onset.

When you hire an agent, ask them right away if they will be working only for you, or if they might be working as a dual agent who also works for the other party. This way, you won’t have to worry about the hidden dual agency. 

Advantages of the Dual Agency

We would look at three key advantages that this offers to the seller, the buyer, and the dual agent

#1. Affordable fee

Working with the same agent may reduce the agent’s fee thereby making it more affordable.

#2. Speeds up transaction

One real estate agent working for both parties means the guy will effectively manage the deal’s time frame. He will have to intelligibly cut the timing of the negotiations.  Reducing in earnest the length of time it takes to schedule a meeting with the interested parties. 

#3. Faster Communication

Communication is mostly faster when using the same agent to represent interest.

Disadvantages of Dual Agency

Despite the few advantages that this has, it is not without disadvantages too. Some of the disadvantages are as follows;

#1. Personal Interest

The agent will be faced with representing two different interests. Most often, the agent focused on his interest as against the interest of the seller and the buyer. Dual agency in real estate is not an unethical practice, however, agents sometimes introduce sneaky tactics that protect their interests.

#2. Conflict of interest

An agent may have trouble being impartial when he or she is working for both the buyer and seller. The interest of these two parties will conflict at this point and both may walk away from the deal if care is not taken. Also, there are records of misconstrued interest between the agent and the buyer. This is solely a result of the agent’s fee involved.  We all know the percentage of the agent’s fee, lies with the seller. There are times when he will not bargain a fair price for the buyer because of his interest in the seller’s deal.

#3. Clients look out for their interest

In most cases, the best the agent can do is to help the transaction. This means the buyer and the seller will have to look out for their interest.

#4. Tricky negotiations

Agents who work for both the buyer and the seller don’t always act in the best interests of both. Also, if that dual agent tells the seller not to accept an offer below the list price, they work against the buyer. The same applies to the seller too. 

#5. No checks and balance

Errors and ambiguities that each agent should uncover will likely be hidden. This is because proper checks and balances that would have been done from two angles were not properly done.

Florida Dual Agency

Florida is one of the states in the USA that does not allow dual agency within its localities. This was mainly because of the crisis and series of lawsuits that occurred between the buyer, seller, and the agent. As a final resort, Florida state introduced transactional agents to curb the problem that comes with dual agency. 

Transactional Agent Florida 

A transaction broker is a type of limited agency in the state of Florida. With this, the agent is only working for the transaction and doesn’t have a duty to help the buyer or seller make the best choice. As a result, an agent is a neutral person who acts as a go-between for the transaction and has to keep some information from both parties. It means the agent cannot say to the seller that the buyer will pay more for the property or say to them that the seller will take less for the property without their permission.

To present this in a simpler form, the agent owes no fiduciary duty to any of the parties involved. There is however an argument against the transactional agent in real estate. The agent solely exists to facilitate the transaction and never to either provide clarity in the interest of either party. This too has its limitations, because a buyer may still buy a house at a higher price than it is worth. 

Before Transactional Agent in Florida

As of the 1980s, about 80% of the state legislative hose passed a real estate law. The law state agents must disclose who they will be represented in writing before the deal continues. Unfortunately, Florida agents saw it as an open ground for dual agency. 

The practice of dual agency in Florida real estate cumbered several complaints which eventually led to lawsuits. One of the most famous cases was the Edina Realty of Minneapolis. The case was won and that brought an end to dual agency in Florida. Presently, Florid recognizes the transactional agency even though it also has its drawbacks.

Fortunately, there are individual bodies such as the Buyer’s Broker of Southwest Florida that exist to eliminate the fracas with dual agency and transactional agent. They are brokerage agencies that serve buyers’ interests. They also do not house list nor represent sellers. Likewise, the agency that represents sellers has no business with the buyers. 

What is the difference between single and dual agency?

Agents who represent both the buyer and the seller of a home are referred to as having “dual agency.” A dual agency situation can arise when two agents operate for the same broker on the same transaction. Single agency refers to an agent or broker who deals exclusively with one party during a real estate transaction.

Can the buyer and seller have the same agent?

Yes, that is permitted. You’re referring to a condition known as transaction brokerage. When your real estate agent represents a buyer client who is interested in buying the property in which you are the seller client, this is a service option.

How do you explain dual agency?

When a real estate agent represents both the home buyer and seller, it is referred to as dual agency. It is much more typical in real estate transactions for separate agents to represent each party, as this helps to eliminate the potential conflict of interest that can arise when an agent negotiates on behalf of both parties.

Is dual agency a good idea?

Dual agency is usually best avoided if you want to safeguard your cash and make sure you are selling or purchasing at the greatest price. Because they desire to learn sensitive information about the person buying or selling the home, buyers or sellers may be compelled to deal with a dual agent.

Why is dual agency problematic?

A dual agency connection can, however, frequently lead to issues in real life. Since the agent is obligated to both sides, it might be challenging for them to represent either the buyer or the seller. As a result, both parties may feel as though they are not receiving the greatest possible representation.

Can I sell my house with two agents?

Joint agency, also known as joint sole agency, is when two estate agents work together to sell your home on your behalf. When a property is sold under a joint sole agency agreement, all participating estate agents receive a commission regardless of whether one actually found the buyer.


When it comes to buying or selling a house, Business yield advises you to get a realtor to represent your interest. Even though the dual agency offers to reduce the agent’s fee, your financial interest is being affected. Therefore, it should be avoided.

FAQs On Dual Agency

What is the difference between single agency and dual agency?

The major difference between these two lies in their definition. A dual agency means one agent represents both the seller and the buyer in a real estate deal. While single agency refers to a real estate agent or broker who exclusively works with one party in a transaction.

Is it a good idea to use the same realtor as the seller?

Not entirely, sincerely, it is not advisable. But if you must, It has to be permitted in your state and your realtor must be comfortable serving both a seller and a buyer, as well as being knowledgeable about both neighborhoods.

Can I be my own real estate agent?

Well, if you think you have what it takes to be your real estate agent,  es can. However, to make it more professional, you can get a real estate license before selling your house.

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