How to Handle Conflicts of Interest When Representing Both Buyer and Seller
Brokerage Tips

How to Handle Conflicts of Interest When Representing Both Buyer and Seller
Navigating the delicate balance of dual agency in real estate transactions requires more than just good intentions. This article delves into the complexities of representing both sides of the table, offering pragmatic solutions and expert insights to maintain transparency, neutrality, and professionalism. Uphold the highest ethical standards with confidence by embracing the strategies outlined by seasoned professionals in the field.
- Navigate Dual Agency with Transparency
- Maintain Neutrality in Dual Representation
- Address Conflicts Promptly and Professionally
- Uphold Ethical Standards in Transactions
Navigate Dual Agency with Transparency
Dual agency can be a practical choice when both the buyer and seller are well-informed, and the property transaction is fairly straightforward. If both parties feel comfortable navigating the process and trust the agent's ability to stay neutral, this setup can save time by streamlining communication and paperwork. I recently had a client, Sarah, who was selling her condo to a long-time acquaintance, and the dual agency worked well since both parties had realistic expectations and trusted each other.
However, for anyone looking for strong representation or facing a more complex deal, dual agency might not be ideal. For example, if you're negotiating over price or specific terms, you may feel that the agent can't fully advocate for either side. First-time buyers especially might feel like they're missing out on personalized guidance, as the agent can't give strategic advice to either party.
As for the commission, it's generally shared between the buyer and seller as part of the closing costs, but specifics can vary depending on the agreement and market norms. It's always worth discussing openly with the agent before committing to this arrangement, so both sides know exactly what to expect.

Maintain Neutrality in Dual Representation
Handling potential conflicts of interest when representing both the buyer and seller in a transaction requires full transparency, clear communication, and strict adherence to ethical guidelines. One of the most important steps is ensuring that both parties fully understand and agree to dual agency or designated agency representation, depending on state regulations. I always disclose my role upfront, explaining that my responsibility is to facilitate a fair and balanced transaction rather than advocate for one side over the other.
To maintain ethical integrity, I provide both parties with the same level of information and avoid offering strategic advice that could give an advantage to one side. This means presenting all offers, counteroffers, and relevant market data objectively, without pushing one party toward a particular decision. Additionally, I document all communications thoroughly to ensure clarity and prevent misunderstandings.
Another key aspect is encouraging buyers and sellers to seek independent legal or financial advice if they feel they need additional representation. This reinforces trust and reassures both parties that their best interests are being protected. By maintaining neutrality, acting with full disclosure, and adhering to state and national real estate ethics codes, I ensure that the transaction remains fair, professional, and free from conflicts of interest.
Address Conflicts Promptly and Professionally
If you think you may be in a conflict of interest, then there's a good probability that you actually are. Notifying all clients of the nature of your conflict as soon as practically possible is the only way to ensure you adhere to your professional standards.
Conflicts of interest are not always the end of a multiple representation relationship. If you can successfully navigate the issue and make your position clear to both parties, the relationship can usually continue.
As for dealing with situations in which fair representation cannot be continued: Instead of simply stating the problem and asking for a solution, it's best practice to propose a solution. For example: "I work well with my colleague X, can I introduce you to them for the purposes of this transaction so that you receive fair and independent representation"?

Uphold Ethical Standards in Transactions
In our firm, we value transparency and honesty in all transactions. When acting on behalf of both buyer and seller, we make clear to the parties involved any possible conflicts of interest and agree on our method of working before we move forward. We speak clearly about our role in the transaction and explain clearly our fiduciary duties.
We follow strict ethical standards by being impartial and objective and giving each side the information they need to make informed choices. Our staff provides equal opportunity to the buyer and seller for all relevant property information, market data, and comparable sales. We are not biased toward one party or the other but aim to achieve a fair and smooth transaction.
By maintaining these principles, we avoid any impression of bias. We also follow all local regulations and laws, with a commitment to ethical behavior throughout the process. By having consistent communication and being transparent, we build a trusting environment in which both parties are confident about the transaction.