In a situation where a licensee works with both buyers and sellers in a transaction, what is this known as?

In the context of real estate transactions, when a licensee works with both buyers and sellers, this is referred to as dual agency. Dual agency occurs when a single agent represents both parties— the buyer and the seller— in the same transaction. This situation can create a unique relationship where the agent must carefully navigate the interests of both clients, ensuring that each party is treated fairly while adhering to legal and ethical obligations.

The reason dual agency is significant is that it requires the agent to maintain an impartial position between the two parties, which can sometimes lead to conflicts of interest. In many jurisdictions, dual agency is legal, but it often necessitates explicit consent from both parties involved, typically through a written disclosure.

In contrast, single agency involves an agent representing only one party in a transaction, independent agency is not a recognized term in real estate contracts, and composite agency isn’t applicable in this context. Understanding these distinctions is crucial for agents to navigate their responsibilities properly and maintain professionalism in real estate transactions.