In real estate, what does "dual agency" refer to?

Dual agency refers to a situation in real estate where a single agent represents both the buyer and the seller in a transaction. This can create potential conflicts of interest, as the agent must navigate the interests of both parties while maintaining a fiduciary duty to each. In such scenarios, the agent is required to disclose their dual representation to both the buyer and the seller and must carefully adhere to laws and regulations that govern such practices to ensure transparency and fairness.

The concept of dual agency is significant because it influences how negotiations are conducted and how information is handled between the parties involved. It emphasizes the importance of clear communication and informed consent from both sides regarding the potential implications of having one individual advocate for both interests simultaneously. This understanding is crucial for any real estate professional engaged in complex transactions, as it directly impacts the dynamics and outcomes of deals.