Historically, real estate agents have represented the seller of a property. After all, the seller is usually the one who pays the commission, and therefore the agents have a fiduciary relationship with the seller. This in no way means that agents can operate outside the bounds of law and ethical conduct, of course. It simply means that the real estate agent is just that, an authorized agent of the seller for a particular transaction.
More recent trends have introduced buyer agents, who typically work with fees exclusively for the buyer, and dual agents. Dual agents represent both the seller and the buyer, especially in cases where the agent’s company is the publicly traded company. Dual agency is legal in most states in the US, however, most consumer advocacy organizations recommend against using a dual agent.
This is because there is an inherited conflict of interest for the agent: they receive a commission based on the sale price of the property. The higher the price, the higher your commission, so his reasoning is that dual agents never care about the best interests of the buyer.
If you have decided to work with a dual agent, this must be disclosed to both the buyer and the seller, and both must agree in writing. Dual Agents are required by law and ethics to treat both buyers and sellers honestly, equitably, and fairly. Dual agents can be prevented from disclosing confidential information about each party to the other. This could seriously damage trading positions.
The bottom line when dealing with a dual agent is to remember that the buyer and seller have conflicting interests in the price and other terms of the sale. It is very difficult for an agent to truly and equally represent both parties, as conflicting interests make that inherently impossible.
If you choose to use a dual agent, make sure that the exact nature of your relationship with the dual agent is clear, you know what services the agent will provide during the transaction, how the agent will be paid, and how disputes will arise. that arise will be handled.
