How is Dual Agency in Brokerage calculated?

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Dual Agency in Brokerage occurs when a single real estate agent or brokerage firm represents both the buyer and the seller in the same property transaction. It creates an inherent conflict of interest and is subject to strict legal disclosure requirements and regulations in most jurisdictions.

How Dual Agency Works and Its Key Implications

• One agent represents both parties simultaneously in a single transaction
• The agent owes fiduciary duties to both buyer and seller, creating a conflict of interest
• Disclosure to both parties is legally mandatory before proceeding with dual agency
• Both parties must provide written informed consent for dual agency to proceed legally

How Dual Agency Affects Commission

• Total commission remains the same but is retained entirely by one agent or brokerage
• Typically structured as the full commission (e.g., 5–6%) paid by the seller
• No separate buyer's agent commission is payable, which some sellers see as advantageous
• Commission splits between listing and buyer agents within the same brokerage vary by agreement

Risks and Protections for Both Parties

• Buyers may receive less aggressive negotiation representation than with an independent agent
• Sellers risk confidential pricing strategy being shared with the buyer
• Some jurisdictions prohibit dual agency entirely due to conflict of interest concerns
• Both parties should consider independent legal advice before consenting to dual agency

Dual Agency is a complex and often controversial arrangement in real estate brokerage that requires full transparency, informed consent, and careful management. Both buyers and sellers should carefully evaluate whether the convenience of a single agent outweighs the potential risks to their individual negotiating position.

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