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Tag Archives: Dual Agency

Dual Agency Only Creates Conflicts & Increases Risks for All Parties

Dual Agency Only Creates Conflicts & Increases Risks for All Parties

Fiduciary Duty to Whom? Real Estate Teams Can’t Possibly Uphold Their Fiduciary Duties To Sellers

A dual agency real estate relationship exists when a real estate agent or a broker represents both sides of a real estate transaction.  A common theme in today’s marketplace is where a “Team” hosts an Open House and if a buyer walks in and wants to offer on the house the “Team” will provide a buyer’s agent.  Well, in this situation, the fiduciary duty owed to the seller goes right out the window because the “Team” has both “implied” and “actual” knowledge of the seller’s inside information.  It’s impossible for the “Team” to adequately and faithfully uphold their fiduciary duties to the seller in this fact pattern.  How can a “Team”  representing both the buyer and seller in the same transaction get the highest price for the seller and the lowest price for the buyer without communicating confidential information during this exchange?  It’s impossible.  By definition an agent is required to act as a fiduciary towards their clients, however, under a dual agency scenario it is impossible to be a fiduciary for both a buyer and a seller in the same transaction; and splitting up a buyer’s agent from the seller’s agent in a scenario where they are from the same “Team” such as this does not pass the smell test.

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