Humber/Ontario Real Estate Course 3 Exam Practice

When a brokerage represents both the buyer and the seller in a transaction, this is referred to as:

1. Dual agency.

2. Single agency.

3. Multiple listing.

4. Buyer brokerage.

5. Seller representation.

6. Exclusive agency.

The correct answer is: Dual agency.

The terminology used in real estate is crucial for understanding the dynamics of representation in transactions. Dual agency occurs when a brokerage represents both the buyer and the seller in a single transaction. This setup can create potential conflicts of interest, as the broker must navigate the interests of both parties while adhering to their fiduciary responsibilities. In contrast, single agency refers to a situation where the agent represents only one party in a transaction, either the buyer or the seller, ensuring that the agent's loyalty and fiduciary duty are exclusively to that one client. Multiple listing pertains to a system where properties are listed for sale through a network that brokers can access, allowing greater visibility and opportunity for sale but does not specify the nature of representation. Buyer brokerage specifically refers to the arrangement where a broker represents only the buyer in the transaction, advocating for their best interests. Seller representation, likewise, denotes the scenario where an agent represents only the seller, focusing solely on selling the property effectively. Exclusive agency is a type of listing agreement in which the seller retains the right to sell the property themselves while still paying a commission if the broker finds a buyer. Thus, the correct identification of transactions involving representation of both parties is dual agency.