Consumer Relationships with Real Estate Professionals


Buying or selling a property is probably one of the most important financial decisions you’ll make. This explains the different relationships you can have with a real estate professional. Each has its own legal meaning and responsibilities, so it’s important to understand them.

There are three kinds of relationships you can have a real estate professional.

  1. A real estate brokerage can act as your agent. This is called common law agency relationship and it includes all brokerage real estate professionals and staff
  2. An individual real estate professional can act as your agent. This is called a designated agency relationship[
  3. You can be the customer of a real estate professional

An agent is someone who acts on your behalf with your permission. If the agent is an individual, the agency relationship is between the individual and you. If the agent is a brokerage, the agency relationship is between the brokerage and you. When you appoint an agent, you’ll be asked to sign a written agreement that explains both the agent’s responsibilities and yours. In agency relationships, you are the client of a real estate professional.

A sole agent acts for either the buyer or the seller (the client) in a trade or possible trade, and has a duty to protect that client’s interests. In this relationship, the real estate professional has the highest level of legal responsibility to you. These responsibilities include:

  1. Undivided loyalty The agent must act only in your best interests and put them above their own and those of other people. The agent must avoid conflicts of interest and must protect your negotiating position at all times.
  2. Confidentiality The agent must keep information confidential, even after your relationship ends. Confidential information includes your personal information, information about the property, and information about the transaction (except information the law says must be disclosed or information you agree to disclose).
  3. Full disclosure The agent must tell you, in writing, about the services they will provide. They must also tell you everything they know that might affect your relationship or influence your decision in a transaction, even if they don’t think it’s important. This includes any conflicts of interest, for example when they act (or are planning to act) on behalf of any other person in a transaction. The only information they can’t give you is confidential information from another agency relationship.
  4. Obedience The agent must obey all your lawful, reasonable, and ordinary instructions. If you insist on something unlawful, the agent must refuse and consider ending your relationship and the agreement.
  5. Reasonable care and skill The agent must exercise reasonable care and skill in all their duties. They must meet the standard of a reasonable and competent member of the real estate industry.
  6. Full accounting The agent must account for all money and property they receive while acting on your behalf. Everything a client puts in the care of an agent—for example, money, keys, or documents—is returned when the agreement ends.

What is a customer relationship?

You can choose to represent yourself in a purchase or sale when a real estate professional represents the other party. In this case, you have a customer relationship with the real estate professional. They can’t give you the services they give when acting as your agent, but they can help make the purchase or sale happen. For example, they may agree to give you statistics or the names of appraisers, mortgage brokers, or other service providers. They may also help you complete standard forms. When a real estate professional works with you as a customer, they have a responsibility to act honestly, use reasonable care and skill, and make sure any information they give is correct.