What does the term "dual agency" signify in real estate?

The term "dual agency" in real estate signifies the situation where a single agent represents both the buyer and the seller in a transaction. This arrangement can lead to potential conflicts of interest since the agent must navigate the differing interests and objectives of both parties. In many cases, the agent helps facilitate negotiations and ensures that both sides are informed about the transaction, but they must do so without favoring one party over the other.

This arrangement is often regulated by real estate laws, which require the agent to disclose that they are acting as a dual agent. This disclosure is critical to maintain transparency and trust in the transaction. In essence, dual agency can streamline the process by having one person manage the entire transaction, but it demands careful ethical considerations to avoid compromising the interests of either party involved.