What is "dual agency" in real estate?

Dual agency in real estate refers to the situation where a broker represents both the buyer and the seller in the same transaction. This arrangement can arise when a buyer is interested in a property listed by the same broker who represents the seller. The critical aspect of dual agency is that the broker must navigate the interests of both parties fairly and ethically, ensuring that there is no conflict of interest that could jeopardize either party's position.

In many jurisdictions, including Indiana, dual agency requires clear and informed consent from both the buyer and the seller, often documented in writing. This ensures that both parties understand the implications of having the same broker represent them, including any limitations on the broker's ability to advocate fully for either party.

In contrast, the other options refer to different scenarios in real estate. A contract between two brokers representing opposing parties does not encapsulate the essence of dual agency, nor does a broker working with multiple buyers since that does not involve representing both sides in a single transaction. Lastly, a partnership between brokers pertains to a collaborative business relationship, which does not directly relate to dual agency.