A single agency is the agent representation of one principal (buyer or seller) of a real property transaction. It is the most common form of real estate agent representation. A broker or an agent representing someone who is looking to buy a home is barred from showing the buyer any listings that are under their agency. If a buyer, who is represented by an agent, wanted to purchase a home that is under the same agency then this is what is called a Dual Agency.
Although not allowed in some states, Dual Agency allows for an agent or broker to serve not only the buyer but the seller as well. Some believe this type of representation to be a conflict of interest with neither side receiving sufficient representation during the entire process.
In light of the ban of Dual Agency in some parts of the country, there are agencies who work exclusively with buyers or focus solely on working with sellers.
A fiduciary duty is a term that characterizes the relationship between a client and their agent. The term, in certain instances, can legally holds the agent accountable to act in the best interests of their client. A buyer or a seller should anticipate their agent to remain loyal and obedient in regard to their wishes.
Occasionally brokers or real estate agents will have no legal accountability in terms of keeping the client’s best interests in mind when providing services. In fact, there are laws in place in 25 states that allow for brokers to provide services to both buyers and sellers with no conventional fiduciary duties of loyalty and obedience.
A Few Traditional Fiduciary Requirements:
– Full disclosure, at all times
– Remain loyal
– Disclose all offers and counteroffers in a timely manner
– Present all facts that directly affect the value of a residential property and are not easily detectable otherwise
Why Single Agency?
Single agency is one of the few ways that one can ensure they are being serviced in a fair, neutral manner in which neither the buyer or seller is benefitting from unjustly. When purchasing property, there are a plethora of laws and regulations that must be abided by and by choosing a broker or agent who specializes in either buying or selling, one can ensure that their fiduciary obligations are being met.