Los Altos Real Estate Blog


Is HUD Removal of Dual-Agency Provisions a Good Thing?

Why did HUD remove the dual-agency provisions?

At the request of NAR, HUD removed their recently published restricts on any agents within the same brokerage from representing the buyer and seller at the same time.  This was a more precise and accurate address to dual-agency as technically, it always exists when two agents under the same broker conduct a transaction on the same property.  The more liberal interpretation of dual-agency is when the same agent under a broker works with both the buyer and seller in the transaction.  There has been widespread fraud when agents represent both buyer and seller at the same time and the issue has been extremely hot here in California.


Flip Flop on Representation?

According to an article today, this isn't necessarily a permanent change but one in which NAR will work with HUD on adopting rules that make sense.  At least that make sense in the view of NAR.  I can understand the uproar on how HUD implemented their rules.  By eliminating buyers agents in the whole office from presenting offers to an agent in the same office with a HUD listing, the buyers themselves are put at a disadvantage - especially if the office is a larger one in a market with few brokers. 

It would appear that NAR is asking HUD to end the rule completely, but I don't see that being the case either.  I think we'll end up with a rule that still says "no dual agency" but only as it applies to not having the listing agent represent a buyer.  In that case, I think this rule makes sense.  Otherwise, it's too restrictive.


The End of Dual-Agency?

When this topic came up a while back I was of the opinion that this could spell the end to real dual-agency (e.g. one agent for both buyer and seller).  I still believe that could end up being the case.  Having a policy in place at HUD could be a foundation to end the practice in states around the country that still allow it.  Here in California, I'm sure there would be support to ban the practice.

As a policy, my company doesn't allow dual agency.  It would be easier for everyone if it were just banned.  What do you think?

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Comment balloon 28 commentsBryan Robertson • September 26 2013 12:59PM


I don't think it would be easier if it were banned altogether.  You start to limit choices for consumers.  If dual agency is fully disclosed to everyone involved it shouldn't be an issue.

Posted by Marc McMaster, Putting my clients before myself (RE/MAX Centre Realty) about 5 years ago

We do have dual agency in New York and it is something that as a newbie I always wondered about. I do new construction and rarely sell my own listings. I actually prefer it that way. Not sure where it is headed.

Meanwhile this new rule seems rather ridiculous and will hurt many people.

Posted by Janis Borgueta, LIC RE Salesperson (Key Properties of the Hudson Valley ) about 5 years ago

Bryan - Dual agency in California is any broker that represents both the buyer and seller, regardless of who the individual agents are that are working for each side. 

There is a big difference when each side has their own agent even when the broker is the same verses one agent representing both sides.  

I'm all for each party to have their own advocate and agent, but I don't think it's right to not be able to show all listings that you are not the listing agent on, regardless of who the listing broker is.  

Posted by Laura Allen, Lake Tahoe - Truckee Real Estate for Sale www.TahoeLauraLuxuryHomes.com, Tahoe Real Estate Agent Helping Buyers and Sellers (Coldwell Banker, Tahoe City, CA (530) 414-1260) about 5 years ago

The problem is the definition of dual agency is not standard across states.  The way the rule was written it also eliminated what we call designated agency in our state.  This means hundreds of agents who work for the same company under the same broker couldn't bring a buyer for a listing by another agent in their company. 

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) about 5 years ago

Bryan I teach a CE class on dual agency every month and it doesn't surprise me much anymore that the most of the students do not understand dual agency and what they can and can't do.  Basically you're hands are tired behind your back because you can't do anything for either party without it being disclosed in writing to both parties. There is no negotating for either party - none.  In my mind what seller or buyer would want an agent that is unable to represent their bests interests?  None that I know.  It's going to become a bigger issue in AZ as times goes on.  We have some mega offices with over 5000 agents and how to work with that in reality isn't an easy fix.  As for the whole HUD issue - not surprised that it came out or that NAR worked on getting it changed.  We'll see where that goes soon enough. 


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Posted by Anna Banana Kruchten CRB, CRS 602-380-4886, Arizona's Top Banana! (Phoenix Property Shoppe) about 5 years ago

Bryan,  I heard they pulled back on that.  My vote is to stop dual agency ... that's my story and I am sticking to it.  We need to split hairs here because I only think the listing agent should not be able to represent the buyer on their listing.  Maybe we need to redefine dual agency.  I am all for that. 

Posted by Kathleen Daniels, San Jose Homes for Sale-Probate & Trust Specialist (KD Realty - 408.972.1822) about 5 years ago

I think dual agency (same agent for buyer/seller) shouldn't be allowed.  How does one possibly have best interests for both parties in mind, when both have different and oftentimes opposite interests. 

The only part of your post I take issue with is you said "HUD" and "rules that make sense" in the same sentence ; )


Posted by John Meussner, #MortgageMadeEasy Walnut Creek, CA 484-680-4852 (Mason-McDuffie Mortgage, Conventional Loans, Jumbo Loans, FHA, 203(k), USDA, VA,) about 5 years ago
Bryan - It seems to me that there should be a difference between two agents and two brokerages.
Posted by Christine Donovan, Broker/Attorney 714-319-9751 DRE01267479 - Costa M (Donovan Blatt Realty) about 5 years ago


A temporary halt to an ill thought out policy is a good thing, in my opinion. I work for a brokerage that has thousands of agents in a designated agency State, so the rule the way it was written would have been very restrictive. I do agree that it should be banned when there is only one agent.


Posted by Richard Iarossi, Crofton MD Real Estate, Annapolis MD Real Estate (Coldwell Banker Residential Brokerage) about 5 years ago

I don't think dual agency will be banned in California because CA is a consumer-friendly state. Banning dual agency will limit choices for the consumer. 

Posted by Pamela Seley, Residential Real Estate Agent serving SW RivCo CA (West Coast Realty Division) about 5 years ago

We respectfully disagree....it was a great thing that this "new rule" was immediately retracted. First...there were no instances of "fraud" which is ridiculous since regardless of who writes the offer...it has to be approved anyway.  It isn't broken...and... The big second thing is that this rule can eliminate hundreds of agents from writing an offer on a property. Short sales are designed to help homeowners...and the housing market....this would have helped no one.

Posted by Sally K. & David L. Hanson, WI Realtors - Luxury - Divorce (EXP Realty 414-525-0563) about 5 years ago

Through all of this commotion, HUD still hasn't specified what fraud was occuring, did not provide any statistical evidence to back up their fraud claim, and didn't explain how banning dual agency on FHA short sales would prevent this alleged fraud.

Kudos to the NAR for standing up to this wrong-headed government think.

Posted by Manny Rosa, New Construction - Union & Essex Counties, NJ (Rosa Agency) about 5 years ago
My thoughts on dual agency: it's hard enough to work short sales without HUD deciding that not only can you not accept an offer from an agent in your own office, you can not represent the buyer. I don't mind not representing the buyer, but can you imagine having a buyer that you worked with for 6 months that you've shown dozens of your company listings to and they want to see my short sale. You would have to tell them, sorry, I can't show you that property, HUD thinks I might commit short sale fraud if I sell it to you, because I work in the same office as the listing agent. Their response would be, OK, I just won't work with you anymore. I'll get an agent from another company. Now, if that isn't controlling the real estate market, I don't know what is.
Posted by Kay Van Kampen, Realtor®, Springfield Mo Real Estate (RE/MAX Broker, RE/MAX Solutions) about 5 years ago

I get the personal dual agency, but company dual agency not so much.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Residential Brokerage | Charlotte, NC) about 5 years ago

I think it is a good thing for now.  Dual agency for a large office is common.   Also, if the listing agent is actively marketing their properties they should be able to represent buyers in a transaction. 

Short sales do get approvals quicker when there is only one agent handling the paperwork just like a one point of contact with a bank negotiator.


In order to stop fraud banks/lenders should recommend short sale agents they work with to their clients and get involved from the very start of the process.


Posted by Keith Lawrence, ABR, CDPE, SFR, 203K Specialist (RE/MAX Properties) about 5 years ago
We agree with Sally. How many times does the lender come back with a counteroffer that is well above a realistic price for the property?
Posted by Bill and MaryAnn Wagner, Jersey Shore and South Jersey Real Estate (Wagner Real Estate Group) about 5 years ago

Bryan, Dual Agency is legal in Virginia as long as it is fully disclosed and approved by the seller. This rulling would have severely limited a companies ability to serve their clients. We have some companies in our area with hundreds of agents. I hope they can work out a better plan.

Posted by Michael Setunsky, Your Commercial Real Estate Link to Northern VA about 5 years ago

Thanks for all the comments so far.  It seems this issue is fairly divided and depends on the state or agency situation.  For example, I don't know of any brokers in the SF Bay Area with thousands of agents.  That said, I agree that in some circumstances this HUD rule would have been very restrictive.

My opinion is that "personal" dual-agency is the thing to target - wherein the same agent represents buyer and seller.  That's probably what they wanted to do and what NAR is arguing for.  Blocking all the agents under one broker would be a mistake.

Posted by Bryan Robertson, Broker, Author, Speaker (Intero Real Estate) about 5 years ago

It is another BAD IDEA by the government. Many times a buyer learns about a home from the buyer agent. The buyer agent learns about the home from the listing agent. There is no better source of leads than one's own office where Listing agents can promote their listings to the buyer agents under the same roof.  Too many buyer agent know NOTHING about short sales and make more of a mess than help. I end up doing twice as much work if not 10x more to clean up their mess and now get paid half? not for me. 

Posted by Scott Godzyk, One of Manchester NH's Leading Agents (Godzyk Real Estate Services) about 5 years ago

Fist there was sub-agency where everyone represented the seller. 

Then came a few buyers agent...everyone hated them until each state said "you now have to disclose to the home buyer that you do not represent them"

All of a sudden all the "haters" got a red rubber stamp and stamped their business cards "buyers agent".

BUT  THEN....no one wanted buyers to know that in certain cases they could not be represented, so NAR created Dual Agency so that agents could continue to double dip and dupe the consumer into THINKING that they are being "represented" when in fact they are NOT.

Anyone who thinks there is no problem with the way short sales are handled "in house" has not made enough short sale offers.

Thank you Bryan for not allowing greed to screw with your thinking...

Eve in Orlando


Posted by Mike & Eve Alexander, Exclusively Representing ONLY Orlando Home Buyers (Buyers Broker of Florida ) about 5 years ago

I think the guidelines should have only pertained to the same agent (not office) being disallowed to be a Dual Agent !!!

Posted by Michael J. Perry, Lancaster, PA Relo Specialist (KW Elite ) about 5 years ago
I am for eliminating an agent "double ending" the transaction, but an end to dual agency is too much. Heck, in some small towns in CA, the nearest other broker may be an hour away.
Posted by Gary Frimann, CRS, GRI, REALTOR and Broker (Eagle Ridge Realty / Signature Homes & Estates) about 5 years ago

Disclosure is the key. Perhaps a signed document indicating what has been disclosed and following simple, basic rules, might simplify what appears to be a very complicated and convulated process. 

Enough already!

Posted by Rebecca Howard, Recognized | Respected | Recommended (Coldwell Banker Residential Brokerage) about 5 years ago


I could not agree with you more.  Well said.  The only stickler in eliminating dual agency is Gary's comment above.  Maybe a provision could address that concern.

Thank you for the great blog that needs reblogging.

Posted by Bill Ladewig, Experience Is Your Advantage (LoanOfficerSchool.com) about 5 years ago

I think there is already more than enough over-regulation to go around!


In states like New Jersey, where "disclosed" dual agency is a legal business relationship, it should remain an option.

Posted by Dennis J. Zisa & Associates, Inc., 27 years in So. Jersey and the Greater Camden area (Dennis J. Zisa & Associates, Inc.) about 5 years ago

I can see how this will hurt the larger offices but as for my office, I preach no dual agency so this change is welcome for us.

Posted by Mike Frazier, Northwest Tennessee Realtor (Carousel Realty of Dyer County) about 5 years ago

If passed the way you suggest then the next step will be the same for traditional real estate as well. We have too many laws hence no one can enforce the ones on the books now and most don't understand them either.

Posted by Charles Stallions, 800-309-3414 - Pensacola, Pace or Gulf Breeze, Fl. (Charles Stallions Real Estate Services ) about 5 years ago

It was wrong for Feds to attempt to regulate what each State already does.  Eliminating Dual Agency based on alleged fraud does nothing to remove agents who may commit illegal or unethical acts, but would penalize agents who do comply with the laws of their State.

Posted by Greg Large, A Tradition of Trust (ERA Real Solutions) about 5 years ago

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