Dual agency is a real estate arrangement that can simplify transactions but also raises important fiduciary questions. Whether you’re a first-time homebuyer, an investor, a law student, or simply curious about how representation works, understanding dual agency will help you make informed decisions and avoid surprises at closing.
Dual agency occurs when one real estate agent or brokerage represents both the buyer and the seller in the same property transaction. Instead of having separate advocates, both parties rely on a single agent to facilitate negotiation, disclosures, and paperwork.
In single agency, one agent owes full loyalty, confidentiality, and disclosure duties to either the buyer or the seller exclusively. With dual agency, the agent must remain neutral, ensuring neither side gains an unfair advantage while still managing communication and transaction logistics.
The dual agent coordinates showings, negotiations, and document signings for both clients. They can’t reveal confidential motivations—such as the lowest price a buyer will accept or the highest price a seller will concede—without explicit consent.
The agent collects offers, counteroffers, inspection reports, and financing updates, then shares them with both parties. All communications funnel through a single point of contact, reducing back-and-forth but requiring strict neutrality to avoid conflicts of interest.
Dual agency is legal in many states but banned in others such as Colorado and Texas. Always check your state real estate commission’s rules before entering any dual agency agreement.
Most jurisdictions require written disclosure and mutual consent before dual agency begins. These forms explain limitations on advocacy, confidentiality boundaries, and each party’s right to hire separate representation.
Even in dual agency, agents owe each client loyalty, reasonable care, and full disclosure of material facts. However, they must balance these duties without favoring one side.
Conflicts arise when negotiating price, inspection repairs, or closing timelines. Agents manage them by following state disclosure rules, refraining from passing confidential info, and encouraging parties to seek legal advice if necessary.
With a single agent: transactions can close faster, paperwork is consolidated, and commission savings may be passed to buyer or seller. A dual agent already familiar with both sides’ priorities can streamline deal-making.
Without separate advocates, you may lose leverage during negotiations. Confidential information—like your top offer price—must stay private, limiting the agent’s ability to secure the best deal.
Typically, the agent or brokerage collects the full commission—often 5–6% of sale price—instead of splitting it with a cooperating agent. Some brokerages may share a portion with affiliated buyer agents.
With the full commission at stake, a dual agent may be motivated to close deals quickly. While this can save time and money, it may also incentivize accepting less favorable terms to expedite closing.
In single agency, one agent focuses solely on buyer needs or seller objectives, offering full fiduciary duty without divided loyalty.
Some brokerages appoint different agents for buyer and seller under the same roof (designated agency) or act as transaction brokers providing limited advocacy to both sides.
If you have complex negotiations, high-stakes contracts, or need aggressive advocacy, separate agents ensure dedicated representation and fewer conflicts of interest.
Ask: “How will you protect my confidential information? What disclosures will you provide? Can I review the dual agency consent form before committing?”
State rules often allow either party to withdraw consent within a specified timeframe. Submit a written request to the brokerage to designate a new agent for unbiased representation.
Review the listing agreement for a dual agency section, which outlines duties, limitations, and compensation details. Ensure you understand every clause before signing.
Buyers receive a separate acknowledgment form explaining dual agency’s impact on negotiation and confidentiality, which must be signed before showings or offers.
The Millers find a charming bungalow listed by Agent Smith. Unbeknownst to them, Smith already represents the seller. After disclosing dual agency and obtaining consent, Smith proceeds to coordinate showings and gather the Millers’ offer.
Timeline of events when an agent represents both sides:
How disclosures are handled: Smith provided separate written forms to the Millers and the seller, outlining confidentiality rules and consent for dual representation.
What the Millers did to protect their interests: they asked for detailed explanations of each document, consulted a real estate attorney for major clauses, and kept a written record of all communications.
Always review dual agency disclosures early, ask for clarification on negotiation tactics, and consider third-party advice if you have any doubts about impartial representation.
Laws vary: check your state real estate commission’s website or ask a licensed attorney to confirm whether dual agency is permitted where you live.
No. Under dual agency, your agent must remain neutral and cannot share one party’s confidential strategy with the other.
If serious conflicts emerge, the agent or brokerage may withdraw from representing one or both parties, or encourage separate representation to maintain fairness.
Dual agency typically does not add fees beyond the standard commission, but always review the listing and buyer-broker agreements for any administrative charges or overrides.
Dual agency offers convenience and potential cost savings but comes with important limits on advocacy and confidentiality. Review all disclosures carefully, ask pointed questions, and consider alternatives if maximizing your bargaining power is critical. By understanding how dual agency works, you’ll be ready to choose the best representation for your real estate goals.
