Real Estate Agency Relationship in California
When you're diving into the world of real estate, whether buying, selling, or leasing property, it's crucial to understand the nature of your relationship with your real estate agent. This clarity helps you navigate the transaction smoothly and ensures that your interests are properly represented. California law mandates that real estate agents disclose their agency relationships to you through a specific document called the Disclosure Regarding Real Estate Agency Relationship. Here’s a breakdown of what you need to know about this form and the various agency relationships it outlines.
Types of Real Estate Agency Relationships
Seller's Agent
A Seller's Agent represents the seller exclusively. If you’re selling a property, this agent’s primary obligation is to you, the seller. Here’s what to expect:
Duties to the Seller: The agent owes you a fiduciary duty, which means they must act with utmost care, integrity, honesty, and loyalty.
Duties to Both Parties: The agent must exercise reasonable skill and care, deal honestly and fairly, and disclose any material facts about the property that could affect its value or desirability. However, they are not obligated to reveal confidential information from one party to the other unless necessary for fulfilling their duties.
Buyer's Agent
A Buyer’s Agent, on the other hand, works solely on behalf of the buyer. If you’re in the market to purchase a property, this agent's primary responsibility is to you, the buyer. Here’s what this entails:
Duties to the Buyer: The agent must provide a high level of care, integrity, honesty, and loyalty.
Duties to Both Parties: Similar to a Seller's Agent, they must apply reasonable skill and care, act with honesty and good faith, and disclose relevant facts about the property. Confidential information between parties is kept private unless consent to share it is provided.
Dual Agent
In some cases, an agent may represent both the buyer and the seller. This is known as dual agency and can only occur with the informed consent of both parties involved. The dual agent’s obligations include:
Duties to Both Parties: They maintain the same fiduciary responsibilities as the Seller's and Buyer's Agents, ensuring utmost care, integrity, honesty, and loyalty.
Confidentiality: Dual agents must keep each party’s confidential information private unless explicit permission is given to share it. This includes sensitive details such as financial positions, motivations, and bargaining positions.
Responsibilities and Confirmations
To ensure transparency, the real estate transaction process includes several key confirmations:
Confirmation of Representation: The purchase agreement or a separate document will confirm whether the agent is representing you exclusively or as a dual agent.
Disclosure Requirements: Agents are required to present the disclosure form to you before a listing agreement is signed or before you execute an offer to purchase. You’ll need to acknowledge receipt of this form to ensure you understand the agency relationship.
Understanding these relationships is vital for protecting your interests in any real estate transaction. It helps you know what to expect from your agent and ensures that you’re aware of their obligations. While agents are skilled professionals, they are not equipped to provide legal or tax advice. If you need guidance in these areas, consulting a qualified professional is advisable.
Have questions about representation in California, don’t hesitate to GET IN TOUCH.
Best regards,
Lindsay Woolf | CA DRE #02236711
DOMO Real Estate | CA DRE #01290500
Disclaimer: The information provided in this blog post is for general informational purposes only and does not constitute legal advice. Real estate transactions can be complex and subject to local regulations.
