What does the term “dual agency” refer to in real estate transactions?

The term “dual agency” refers to a situation in real estate transactions where a broker represents both the buyer and the seller within the same transaction. This can create potential conflicts of interest, as the broker must navigate the interests of both parties while ensuring that best practices and legal obligations are followed.

In many jurisdictions, including those governed by the OACIQ, dual agency requires transparency and often involves additional disclosures to both the buyer and seller to ensure they understand the implications of the broker representing both sides. It is crucial for the broker to act fairly and impartially, as they must not favor one party over the other during negotiations. This definition encapsulates the essence of dual agency and illustrates how it operates within the framework of real estate practices.