what is dual agency featured image

By Karen D. Friedman | 03.08.21

Agency in real estate refers to who an agent represents in a transaction.  That means the agent is either representing the buyer or the seller.  In a dual agency, the real estate agent has an opportunity to represent both sides of the transaction.

Dual agency is illegal in some states, but in California, any real estate agent can do it.

Representing both sides of a transaction has its advantages and disadvantages. The most obvious advantage is the ability to gain a larger commission.  

Let’s discuss both sides of this unique relationship and how to navigate it when dealing with dual agency.

How Dual Agency Works

A dual agency opportunity usually starts with you having the listing. This means you are already representing the seller and will be getting the commission. You then get an opening to represent the buyer.

You may be wondering how this even works because most buyers already have an agent…but that’s not always the case. Some buyers don’t commit to an agent until they’re serious about buying.

So how does this happen?  You may find a buyer who comes to your open house, loves the listing and asks you on the spot if you can help them buy the home. 

Boom! 

You are now representing the buyer as well. You’ve just doubled your commission.

Here is another dual agency example. You have a buyer that you’ve already been working with. When your new listing comes on the market, you show it to your buyer and it is a good fit. Again, now you are representing both sides of the deal.

Some agents actively look for the buyer after they get the listing.  They are then creating the potential for the dual agency transaction.

The Dual Agency Controversy

Although the concept of dual agency is simple, some agents do not agree with this practice.

There are many agents who won’t represent both sides of a transaction. They consider it a conflict of interest. Legally, we know that this isn’t true.  This comes from the opinion that the agent will not be able to fulfill their fiduciary duties to both the buyer and the seller.

A fiduciary duty is a legal obligation for one party to act in the best interest of another. This usually has to do with property, money or other assets.  

Some agents believe this can only be accomplished if they focus all their attention to one side. This thinking is short-sided though. As long as you are protecting the integrity of the deal, you can protect the interest of both the buyer and the seller at the same time.

What is the meaning of “protecting the integrity” of the deal?  Simply put, it means making sure all agreed upon items by both parties are being executed.

Having dual agency doesn’t mean that one party’s interest has to suffer while trying to execute the other party’s interest.  Think of it like being a couple therapist. You are there to listen and advise both parties to arrive at a mutually beneficial outcome.

How to Set Up a Dual Agency

If you are fortunate enough to find yourself in a potential dual agency transaction, make sure you have the buyer and the seller sign the PRBS Form. You will have the buyer and the seller sign this before starting the transaction.

The PRBS stands for the “Possible Representation of More than one Buyer or Seller.” This was previously known as the “Dual Agency” form.

It’s important to have this disclosure in writing. 

Simply stated, it confirms that all parties have acknowledged that the agent will represent both the buyer and the seller and are in agreement.

It is also important to note that “dual agency” can mean that the same brokerage represents both the buyer and seller but by 2 different agents.

Dual Agency Advantages

There are also some great benefits to being a dual agent besides the financial aspect. 

One Point of Contact Since you are the only agent handling the deal, you have better control over making sure the agreed upon items are being executed. Not only with your buyer and seller but with all parties associated with the transaction like the lender, title and escrow. This ultimately means a smooth transaction.

Good Communication Because both sides are contacting one agent, the whole transaction is streamlined. Terms and conditions can be communicated swiftly and efficiently by all parties. 

Avoiding Conflict – When you’re dealing with another agent on the other side of the deal, sometimes personalities can clash.  Miscommunication is also a factor. This can create issues with getting the transaction done in a timely manner.  Dealing directly with both the buyer and seller avoids dealing with challenging or difficult agents.

Final Thoughts on Dual Agency

Real estate is a career that holds unlimited earning potential.  Part of maximizing your income can be through the practice of dual agency. It is a great opportunity to double your commission. 

As the real estate professional, you can serve the interests of both the buyer and seller equally. Don’t fall victim to the belief that one side has to suffer. If you protect the integrity of the deal, everyone wins – including you!

Remember, not all your clients may be into the idea of having one agent represent both sides. Each transaction will be different. But if everyone’s in agreement, there is nothing wrong with dual agency.

Are you an agent willing to practice dual agency?


Every week, we release in-depth videos to help viewers become successful real estate agents on our CA Realty Training YouTube Channel. Also, if you enjoyed reading this article, we would love if you could share it with a friend who you think would get something out of it.
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