In a subagency transaction, who does the broker working with the buyer owe a fiduciary duty to?

In a subagency transaction, the broker who is working with the buyer actually owes a fiduciary duty to the seller. This occurs because in a subagency situation, the broker is acting on behalf of the listing agent and, by extension, the seller, even though they are interacting primarily with the buyer. This means that the broker must work in the best interests of the seller, ensuring that their obligations are fulfilled while facilitating the sale.

It is essential to recognize that since the broker representing the buyer is a subagent of the seller's broker, their primary allegiance is to the seller rather than to the buyer. The buyer may still benefit from the broker's assistance, but the fiduciary duty—the legal obligation to act in the best interests of another party—remains with the seller in the context of the subagency agreement.

Understanding this dynamic is crucial for real estate professionals, as it illustrates the importance of agency relationships and the responsibilities that come with them. In this context, the broker must provide any pertinent information to the seller and uphold the seller's interests throughout the transaction, even while consulting with the buyer.