Dual Agency in Real Estate, Explained
You walk into an open house. You fall in love with it. You find the listing agent and ask if they can represent you too. The answer is usually yes. It is called dual agency, and on paper it sounds simple: one agent, two parties, everyone treated equally.
In practice, it is more complicated than that.
What Dual Agency Actually Means
When I am acting as a dual agent, I represent both the buyer and the seller in the same transaction. Once that happens, my hands are tied in ways most buyers and sellers do not expect. If you ask me what it will take to beat out other offers, all I can legally tell you is the price the seller wants. You can go higher, lower, or match it. That is the full extent of what I am allowed to share. I know what the competing offers look like, but the moment I tell a buyer how to beat them, I have failed every other buyer at the table, and that crosses directly from a gray area into a violation of my legal obligation to the seller.
Why Dual Agency Causes So Many Problems
Dual agency generates more complaints at real estate commissions in nearly every state than almost any other issue in the industry. The reason is not that every dual agent acts in bad faith. It is that the structure itself creates a conflict that is difficult to navigate cleanly, even for agents acting with full integrity.
Under Michigan law, a licensee can represent both the buyer and the seller in a transaction, but only with the knowledge and informed written consent of both parties, and that dual agent cannot provide the full range of fiduciary duties to either side. The disclosure of the agency relationship must be in writing and must explain that in a dual agency situation, the licensee will not be able to disclose all known information to either the seller or the buyer.
My Own Experience With Dual Agency
In eight years of practice, I have handled exactly one dual agency transaction. I went into it with my eyes open, over communicating with both the seller and the buyer at every step to make sure they fully understood what dual agency meant, what I could and could not do for them, and what they were agreeing to. Both parties were informed, both were on board, and I was about as transparent as an agent can be.
Even then, it is not something I plan to make a habit of. That transaction involved very specific circumstances that called for it. As a general rule, it is not how I do business.
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Why I Avoid Dual Agency When I Can
When an agent stands to collect both sides of a commission, the temptation to tip the scales, even slightly, becomes real. When that happens, someone loses, and it is usually the person who trusted the agent the most. Real estate involves competing loyalties, real money, and real trust. Those are human dynamics that deserve a human level of care, not a shortcut.
What This Means For You
If you are a buyer, understand exactly what you are agreeing to before you ever sign a dual agency agreement. Ask questions, get clarity, and make sure the agent across from you has the integrity to hold that line fairly. It also helps to know what makes a great real estate agent in Metro Detroit and to understand the details of any agreement you sign.
If you are a seller, think carefully about whether you are comfortable with your agent representing the buyer at the same time. My guide on how to choose a listing agent can help you find representation that works solely for you.
Dual agency is not inherently wrong, but it is a tightrope. Most people do not realize they are on it until they are already in the middle of a transaction with no net below them.
Common Questions About Dual Agency in Michigan Real Estate
Is dual agency legal in Michigan?
Yes. A real estate licensee can act as the agent of both the seller and the buyer in a transaction, but only with the knowledge and informed consent, in writing, of both parties.
What can’t a dual agent tell me?
A dual agent cannot share confidential information that would benefit one party at the expense of the other, such as the maximum a buyer is willing to pay or the minimum a seller will accept beyond the listed terms.
Do I have to agree to dual agency?
No. You can decline dual agency and work with your own buyer’s agent or seller’s agent instead, who owes fiduciary duties solely to you.
How common is dual agency?
It happens, but most experienced agents use it sparingly given the complaints it generates with real estate commissions and the conflicts it can create.
Thinking about buying or selling in Metro Detroit and want an agent who will always tell you exactly where you stand? Reach out to me to talk through your situation.
Have a question, or just want to talk it through?
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