Should a real estate broker attempt to represent both the seller and the buyer in a single transaction? The first response that most people are likely to give is that a broker should not try to do so because of the potential and even real conflicts of interest that might well arise both between the broker and one of his or her clients or between the two clients. However, while these concerns are certainly legitimate ones, there are also arguments to be made for a single broker serving both sides. This paper examines both sides of this particular argument.
We begin by arguing why a real estate broker should work for either the buyer or the seller but not for both. The problems inherent in the broker serving both sides are summed up in the adage: "No man (or woman, of course) can serve two masters". Of course, there can be exceptions to this adage: If both sides want the same outcome then there is no conflict of interest. One might argue that this is in fact the case when a real estate transaction is being made: Both sides want a piece of property to change hands. This is true: But the seller wants the property to change hands in a way that guarantees him or her the maximum profit while the buyer wants the property to change hands at the minimum cost. Thus the buyer and seller share one goal, but not the other.
It should be noted that simply because there are problems inherent in such a dual relationship, it is almost always legal. But simply because a policy is legal does not mean that it is a good business practice.
Dual agency, where the agent claims to be serving both parties, is allowed almost everywhere, provided it's fully disclosed in writing. To me, however, such an arrangement has always been an iffy thing at bestà.[but] what does a dual agent do when he or she hears either the sellers say they will accept less or the buyers that they will pay more? Keep silent? Tell one and then explain to the other why he or she rev...