Simply put, the leasing office or broker cannot advise you objectively. Their loyalty is to the landlord, and they are unfairly influenced.  Dual agency is a hot-button issue. While banned in several states, it’s still legal in California. The pitfall is an over-incentivized or unethical influence by the double commission. Disclosure alone isn’t enough.

Dual agency – an unsound practice

For the tenant, general principles render dual agency as unsound practice.  The broker’s focus is to increase building value through rent, occupancy and tenant obligations. Their job is to get you to sign the lease quickly because time kills all deals. Tenants should be aware of their rights and the responsibilities landlords have. You can view them here.

It would be unwise to negotiate aggressively on your behalf because this would sour their relationship with the landlord. It comes down to space, budget and the tenant’s level of confidence. A dual agent cannot focus on the lowest and the highest rent at the same time.

Where to find appropriate representation as a tenant – without dual agency

The listing broker’s true allegiance is to the landlord, a much bigger client. Essentially, tenants should use a broker that only deals will tenants and not landlords.

Commissions: All landlords pay transaction costs to keep their building occupied or attract new tenants. Word of mouth and advertisement doesn’t fill their building. The idea of saving money by not having representation or going direct is a misperception amongst small to medium-sized tenants.

When signals point to you staying and renewing, this is especially true. You don’t save by not having your own guy., and “dealing direct” with a “good relationship” doesn’t translate to a better deal.

Ready to commit to a real estate agent?

If you have chosen your real estate agent, ask to see their disclosure agreement. You should try to do this as soon as you can in the game.

Read the agreement and be sure to ask about anything you don’t understand – especially if you’re concerned that something in it alludes to dual agency. With this, you will have a better understanding of your working relationship and you can rest assured that the agency is working in your best interests.