Understanding Dual Agency: What NYC Real Estate Buyers Need to Know
In a market as competitive and nuanced as New York City, clarity of representation matters. Informed conversation is the foundation of clear representation. Knowing how agency relationships work helps NYC buyers protect their interests and navigate decisions with confidence.
Navigating the New York City real estate market requires more than an understanding of prices and neighborhoods—it requires clarity around representation and how it shapes your interests throughout a transaction. Just as buyers and sellers rely on separate legal counsel to provide independent guidance, working with a dedicated real estate agent helps ensure your goals remain clearly represented at each stage of the process.
One area where representation often becomes unclear is dual agency. In fast-moving markets, buyers may encounter situations—sometimes without realizing it—where the same brokerage, or even the same agent, is involved on both sides of a transaction. While this structure is permitted under New York law, it changes how guidance, negotiation, and advocacy function in meaningful ways.
Understanding how dual agency works, and what it limits, allows buyers to make informed decisions about representation before they are deep into a negotiation or contract process.
1. What Is Dual Agency?
Dual agency occurs when the same real estate agent or brokerage represents both the buyer and the seller in the same transaction. This arrangement is legal in New York State, provided it is fully disclosed and agreed to in writing by both parties.
However, dual agency significantly limits how an agent can operate. Because the agent owes fiduciary duties to both sides, they cannot fully advocate for either party’s negotiating position. Instead, the agent must remain neutral—unable to advise on pricing strategy, negotiating leverage, or confidential motivations that would normally guide a buyer or seller through key decisions.
In practice, this means buyers and sellers receive process guidance rather than strategic representation, which can create challenges during negotiations and moments where advocacy would otherwise matter most.
2. Navigating the Market Without Representation
Fiduciary responsibilities—such as loyalty, confidentiality, disclosure, obedience, reasonable care, and accounting—form the foundation of the relationship between a buyer and their real estate agent. Without independent representation, buyers may interact extensively with listing agents early in the process without fully understanding the limits of those interactions. Because listing agents represent the seller, they cannot provide guidance or advocacy aligned with a buyer’s interests.
This dynamic is especially common among first-time homebuyers. Many buyers begin their search by browsing listings on platforms like StreetEasy or attending open houses, where the agents they meet are working solely on behalf of the seller. Without clarity around agency relationships, buyers may proceed without a dedicated advocate to help interpret pricing, assess risk, or negotiate strategically—leaving key decisions unsupported.
Understanding representation early allows buyers to navigate the market with clearer expectations, stronger positioning, and proper advocacy throughout the process. For more information visit: Fiduciary Duties Explained: The Role of a NYC Real Estate Agent.
3. Why Dual Agency Is Not Advisable
The central challenge of dual agency is the inherent conflict created when one agent is required to remain neutral between two parties with opposing interests. A real estate agent’s fiduciary duties—loyalty, confidentiality, and the obligation to act in a client’s best interest—are significantly limited in this structure. Because the agent represents both sides, their role shifts from advocate to intermediary.
For buyers, this typically results in practical constraints:
A dual agent cannot provide tailored negotiation guidance. Pricing strategies, offer positioning, and counteroffer recommendations must remain broad and non-directional, rather than buyer-specific.
Confidential information cannot be used to guide strategy. While confidentiality is still required, a dual agent cannot apply insights from one party to advise the other, limiting meaningful advocacy.
The agent must remain neutral throughout the transaction. This limits proactive guidance during inspection findings, concessions, and closing negotiations—often the moments where buyers benefit most from representation.
Even with full disclosure and written consent, dual agency can introduce uncertainty. If either party later believes their interests were not fully supported, disagreements may arise over the scope of representation and expectations.
While dual agency may appear to simplify communication, it often restricts the strategic value of representation. Independent representation allows buyers to receive focused advice, clear advocacy, and informed guidance throughout negotiations—advantages that remain especially important in New York City’s competitive market. For more information visit: NY Department of State: Legal Memorandum LI12: Be Wary of Dual Agency.
4. Dual Agency in Practice
To understand the challenge of dual agency, consider a common scenario.
During negotiations, an agent learns that a seller has flexibility on price and would consider offers meaningfully below the asking price. At the same time, the agent also knows that the buyer has room to increase their offer to secure the property. In a dual agency situation, the agent cannot share or act on either insight. Because they represent both sides, they must remain neutral—even when that neutrality limits the ability to help either party reach the most favorable outcome.
As a result, negotiations often become less informed and more constrained. Both buyer and seller may agree to terms without the benefit of full advocacy, simply because the agent is prohibited from using information that would otherwise guide strategy. Independent representation allows each side to understand their leverage clearly and negotiate with confidence.
5. New York State Disclosure Form for Buyer and Seller
In New York State, real estate agents are required to provide the Disclosure Form for Buyer and Seller at the first substantive contact. This form outlines the different types of agency relationships available, including dual agency, and is designed to ensure buyers and sellers understand how representation works before proceeding.
Importantly, the form states that in a dual agency situation, the agent will not be able to provide the full range of fiduciary duties to either the buyer or the seller. It also explains that by consenting to dual agency, both parties give up their right to undivided loyalty from the agent. These are not interpretive points—they are explicit disclosures built into the form itself.
For dual agency to move forward, both buyer and seller must consent in writing. Buyers should read this document carefully and take the time to understand what they are agreeing to. If dual agency is proposed, it’s appropriate to ask direct questions about how it may limit advocacy, affect negotiations, and shape the agent’s role throughout the transaction. Understanding this disclosure helps buyers make informed decisions about representation from the outset.
6. The Role of Your Real Estate Agent
Your real estate agent should serve as a clear, independent advocate throughout the buying process. With independent representation, your agent can provide candid advice, negotiate strategically on your behalf, and protect your interests without divided obligations. This includes helping you assess value, navigate negotiations, and interpret risks at each stage of the transaction.
In a market as competitive and nuanced as New York City, clarity of representation matters. Understanding agency relationships—and choosing representation that is aligned solely with your goals—helps ensure that decisions are made with transparency, confidence, and your best interests firmly in focus through to closing.
Related Resources and Insights
If you’re exploring properties in NYC and want to learn more about agency relationships, I’d be happy to discuss how I can help you navigate the complexities of the market. Feel free to reach out with any questions or to get started on your search today.