Dual agency can save both buyers and sellers time and frustration when navigating the home sale process. However, it’s not an agreement you should enter into lightly. You’ll want to think about how the dual agent will impact your experience before you make your decision. Here’s how to tell if dual agency arrangement is right for your real estate transaction. Show
For SellersDual agents can streamline the home sale process, helping you sell your home faster and with less hassle. However, since they represent the buyer too, your real estate agent may not be willing to negotiate a higher price with the buyer. This can eat into your profit and keep you from getting the terms you’re looking for. If you’re in a hurry to sell and aren’t worried about maximizing your potential profit, working with a dual agent may be an acceptable option. For BuyersDual agents can be more beneficial for buyers than sellers. Working with a dual agent may increase the number of available homes that you can view with ease and can simplify communication with the sellers since they’re already working closely with them. If you’re worried about communicating with sellers or want to be able to view the most homes possible before making an offer, working with a dual agent may be a good idea. This sets up a potential conflict of interest: an agent is supposed to negotiate on their client’s behalf, but one agent representing both sides of a sale can’t negotiate against themselves. Many states have regulations designed to protect sellers and buyers from being taken advantage of by dual agents or at least to require agents to clearly disclose potential conflicts. Even with regulations, it’s hard for dual agents to remain neutral and respect their clients’ confidentiality. Let’s say that, as a seller, you confide in your listing agent that you’re willing to accept an offer $50k below asking price. Your agent then represents a prospective buyer who wants to make an offer on your home. Can you trust that the agent is going to push to get you the highest price? Or will they disclose your “bottom line” to help their new client get a great deal? Agents benefit from dual agency: By representing two clients at once, a dual agent can earn more commission from a single transaction. Dual agent sales are also likely to be faster because a single agent can manage the timeline with no back-and-forth. What is designated agency vs. dual agency?Designated agency is when the buyer and seller work with two different agents from the same brokerage. Though designated agency is slightly different than dual agency, some risks may carry over, including:
However, designated agency does ensure each party has an agent advocating on their behalf. As long as each agent is free to work independently, designated agency can help minimize the conflict of interest that occurs when one agent attempts to represent both sides. Is dual agency legal in my state?As of November 2020, dual agency is illegal in eight states: Alaska, Colorado, Florida, Kansas, Oklahoma, Texas, Vermont, and Wyoming. Dual agency is legal in all other states and Washington, D.C., though regulations vary by state in three key areas:
We’ve boiled down the need-to-know information about dual agency regulations in all 50 states and Washington, D.C. Dual agency regulations by stateState Is dual agency legal? Alabama Yes. Agents are advised (but not legally required) to get written consent “as soon as reasonably possible.” Learn more. Alaska No, but designated agency is legal. Learn more. Arizona Yes, and agents are required to get written consent. Learn more. Arkansas Yes. Agents are required to get verbal consent. Learn more. California Yes. Agents are required to get written consent as soon as possible. Learn more. Colorado No, but the buyer and seller can be represented by the same brokerage. Learn more. Connecticut Yes. An agent must get written consent from both parties before showing the property to a buyer they also represent. Learn more. Delaware Yes. The state presumes you consent to a dual agency situation, unless you sign a written agreement stating you do not. Learn more. Florida No. However, the state assumes that all representation is transactional unless otherwise clarified. Learn more. Georgia Yes, and agents are required to get written consent. Learn more. Hawaii Yes. Agents are required to discuss how representation works with clients and get written consent before entering a dual agency situation. Learn more. Idaho Yes, and agents must get written consent before proceeding with a dual agency transaction. Learn more. Illinois Yes, and agents must get written consent before proceeding with a dual agency transaction. Learn more. Indiana Yes, and agents are required to get written consent. Learn more. Iowa Yes, and agents are required to get written consent before a transaction can proceed. Learn more. Kansas No, but transactional representation is legal with verbal or written consent. Learn more. Kentucky Yes. Buyers and sellers are required to sign a form that explains all possible types of agency relationships prior to signing any contract for representation. Learn more. Louisiana Yes, and agents are required to get written consent before a transaction can proceed. Learn more. Maine Yes. Disclosed dual agency is legal with written consent. Learn more. Maryland Technically yes, but Maryland defines dual agency differently than other states. In practice, it allows “designated agency” — buyers and sellers can work with different agents from the same brokerage, but a single agent can’t represent both parties. The broker must obtain written consent from both parties. Learn more. Massachusetts Yes, and agents are required to get written consent. Learn more. Michigan Yes, and agents are required to get written consent before a transaction can proceed. Learn more. Minnesota Yes. Buyers and sellers must provide verbal and written consent “early in the relationship” with their dual agent. Learn more. Mississippi Yes, and agents are required to get written consent before a transaction can proceed. Learn more. Missouri Yes, and agents are required to get written consent before signing a contract with a buyer or seller. Learn more. Montana Yes, agents must get written consent before or when a dual agency situation arises. Learn more. Nebraska Yes. Buyers and sellers must provide written consent before signing with an agent. Learn more. Nevada Yes. Buyers and sellers must provide written consent to multiple representation before signing with an agent. Learn more. New Hampshire Yes, and agents must get written consent at their first business meeting with a buyer or seller. Learn more. New Jersey Yes. Buyers and sellers must provide written consent before signing with an agent. Learn more. New Mexico Yes. A dual agent acting as a facilitator must get written consent prior to writing or presenting offers. Learn more. New York Yes, and agents are required to get written consent before a transaction can proceed. Learn more. North Carolina Yes. Agents must get written consent in the original listing agreement or before introducing a buyer they also represent. Learn more. North Dakota Yes, agents must get written consent before a transaction closes. Learn more. Ohio Yes. Buyers and sellers must provide written consent before signing with an agent. Learn more. Oklahoma No. Oklahoma allows single party and transaction brokers, but dual agency is illegal. Learn more. Oregon Yes. Disclosed limited agency is allowed with written consent. Learn more. Pennsylvania Yes. Agents are required to get written consent, and a broker can also be considered a dual agent. Learn more. Rhode Island Yes. Agents must get written consent before making an offer. Learn more. South Carolina Yes, agents must get written consent from both parties. Learn more. South Dakota Yes. Agents must disclose the limitations of dual agency at the first substantive contact with a potential client and get written consent. Learn more. Tennessee Yes. Agents must get written consent in the original listing agreement or before making an offer (whichever comes first). Learn more. Texas No. Agents can only have one client, but are allowed to treat the other party as a customer in a transaction. Learn more. Utah Yes. Buyers and sellers must provide written consent for limited agency before signing with an agent. Learn more. Vermont No, dual agency is not legal in Vermont. Learn more. Virginia Yes. Buyers and sellers must provide written consent before signing with an agent. Learn more. Washington Yes. Agents must get written consent from both parties prior to the transaction, otherwise they will solely represent the original party. Learn more. Washington DC Yes, agents must get written consent upon having a substantive discussion with a potential client. Learn more. West Virginia Yes. Buyers and sellers must provide written consent before signing with an agent. Learn more. Wisconsin Yes. Buyers and sellers must provide written consent before signing with an agent. Learn more (PDF). Wyoming No, dual agency is not legal in Wyoming. Learn more. Show MorePros and cons of dual agencyDual agency doesn’t just benefit the agent — it can also benefit the buyer and seller. Of course, dual agency carries some significant risks as well — particularly if you don’t fully understand them. Before proceeding with a dual agency sale, be sure to weigh the potential benefits against the risks, vis-a-vis your specific situation. If you do choose to move forward, we’ve outlined some helpful considerations and tips so you can proceed with confidence. Pro: You may be able to save moneyWhen only one agent is involved in a sale, the seller only has to pay that one agent instead of two. This lowers the overall cost of the transaction, typically resulting in 1-2% savings or more. These savings give both parties more wiggle room in negotiations. After a deal closes, the seller may walk away with more profit, the buyer may have secured a lower price, or maybe a combination of the two! Pro: Could make the sale faster and easierIn some cases, dual agency allows you to skip the listing or house hunting process altogether. This most commonly occurs when an agent:
Dual agency also results in more direct communication. Because both parties share one agent, you’ll never have to wait for a complicated back-and-forth mediated by multiple agents. Con: You’ll have to be your own advocate and negotiatorBecause the agent must serve both clients equally and fairly, they technically can’t try to sway either party while attempting to close a deal. That means it’s on you to handle all negotiations and advocate for your best interests. Con: Agent may reveal confidential information to other partyDual agents are technically supposed to be neutral parties — but they’re also highly motivated to get the deal done. They’re often privy to information that can factor into negotiations, such as both parties’ bottom lines, the motivations for selling or buying, and so on. The dual agent may use or share that information — intentionally or even accidentally — to close the deal, which could negatively affect one of the parties involved. While this is technically illegal, it does happen often. If you think you’ve been defrauded or misled in a dual agency sale, you may have legal recourse. Con: Less competition could keep you from getting the best priceOften, dual agency happens when an agent realizes they have an existing buyer who would be a good match for one of their listings. This can bring speed, convenience, and potential savings for the seller. But it’s not always the best option. In a high-demand market, listing the property to the widest possible audience can spark competition and potentially drive up the sale price. It really comes down to your priorities — speed and convenience versus price — so talk to your agent about your options. Your agent is technically obligated to look out for your best interests, and a good agent will be honest in helping you make the right call. But keep in mind that agents stand to earn more through dual agency. If your agent is overly pushy or dismissive of your concerns, consider it a major red flag. How does dual agency impact commissions?Dual agency’s biggest perk is that it can help sellers save on commission. Sellers typically pay a 5.5-6% commission that’s split between their agent and the buyer’s agent. A dual agent gets to keep the entire commission, also known as “double ending” a sale. Many dual agents are willing to reduce their commission, so don’t be afraid to negotiate. They’ll still earn more from a dual agency sale than a traditional transaction in which the commission is split between two agents. Here’s a simplified example that illustrates how the numbers could break down for a standard 6% commission:
In practice, the final commission rate could be more or less. As you negotiate your agent’s commission rate, ask about variable rate commission. This means your agent would charge the full commission rate if the sale closes with another agent or a reduced rate if it is a dual agency sale. Who should consider dual agency?
Who should avoid dual agency?
» MORE: Find top agents near you. Negotiating in a dual agency saleIn a dual agency sale, your agent is technically an impartial mediator, so you’ll be in the driver’s seat when it comes to negotiating the terms of the deal. Remember, everything in real estate is negotiable—so don’t be afraid to push for the things you want! To set yourself up for success at the negotiating table, be careful about what information you disclose to a dual agent. For example, avoid sharing your bottom line, motivation for selling or buying, or required timeline. This type of information increases the risk of confidentiality breaches that could jeopardize your negotiating power. Tips for buyersIn a dual agency deal, many buyers will attempt to make a lower offer or negotiate a lower sale price, knowing the seller is paying less in realtor commission fees. Dual agents won’t be able to advise you on how hard to push on price, so do your own research. Ask your agent for comps (recent sales prices for similar homes in your area) that justify the listing price. Then, confirm their findings by looking at similar properties in the area, focusing on the price per square foot and interior finishes Tips for sellersBecause buyers understand that sellers often have some wiggle room in a dual agency deal, they may ask for repairs or concessions while negotiating. It’s crucial to compare the buyer’s estimate to your own quotes from trusted contractors. Sellers who aren’t familiar with repair costs can easily be taken for a ride. Dual agency exit strategiesIf you’re looking to avoid or get out of a dual agency situation, your options will depend on how far into the process you’ve gotten. Want to avoid dual agency?Most states require agents to obtain consent from both parties before proceeding with a dual agency sale. If you don’t feel comfortable with dual agency, you don’t have to agree to it. The most common dual agency scenario is when an agent receives an inquiry about one of their listings from an unrepresented buyer. In this case, avoiding the dual agency situation is relatively straightforward:
Backing out of a dual agency agreementIf you’ve agreed to dual agency sale but have a change of heart, it is possible to change course. Before attempting any drastic changes, we recommend talking to your agent. Explain what’s making you uncomfortable or unhappy, and see if they can adjust. For example, your agent might be able to bring another agent from their brokerage into the deal. If you’ve already signed a contract and decide that it’s just not working out, it is possible to change agents. The next steps will be different for buyers and sellers. Advice for buyersIf you’re buying, changing agents breaks down into two distinct situations. The deciding factor is whether the buyer has signed a broker’s agreement:
Advice for sellersIf you’re selling, there may be more barriers to changing agents. Your contract will spell out any limitations or processes you’re legally obligated to follow. You may have to:
Keep in mind that many contracts expire after a period of two to six months. If you’re close to your contract’s end date, you may want to just wait it out. » MORE: Try Clever's free agent-matching service. What to do if you feel misled or defrauded by dual agencyIf you feel defrauded or misled by a dual agency sale, you may have legal recourse. Most state regulations prohibit dual agency situations in which the agent:
These types of lawsuits aren’t uncommon. For example, in 2019, celebrity realtor Ryan Serhant faced a $1M lawsuit when a past client alleged that he failed to disclose that he represented both the buyer and seller. Similarly, a still-ongoing class action lawsuit alleges that New York brokerage Houlihan Lawrence pushed dual agency deals that resulted in distorted pricing. If your experience appears to violate local regulations, we recommend getting in touch with a qualified real estate attorney to discuss your options. Taking legal action can be expensive, time intensive, and stressful — but considering that your home is likely your most valuable asset, pursuing justice may be well worth the investment. Can you be a dual agent in Illinois?Unlike a real estate closing attorney who can only legally represent one party in a transaction, dual agency in real estate sales is legal. As long as the agent fully discloses the relationship to both buyer and seller and receives their written consent, there is no restriction in representing both.
Is Illinois a dual agency state?Illinois law protects homebuyers and sellers in dual agency situations.
Which of the following qualifies as dual agency?Dual agency is when a single real estate agent represents both the buyer and the seller in a real estate transaction. It can also occur when an agent represents both the landlord and the tenant, or when the same real estate company represents both parties in a purchase and sale or rental transaction.
When acting as a dual agent what form must be signed by the clients?The dual agency disclosure form will be signed giving consent to the agent to act as a dual agent at the time the brokerage agreement is entered into, and at any time before the licensee acts as a dual agent.
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