In an agency relationship, which party is typically considered the fiduciary?

In an agency relationship, the real estate agent is typically considered the fiduciary. This designation means that the agent has a legal and ethical obligation to act in the best interests of their client. The fiduciary duty encompasses several responsibilities, including loyalty, obedience, disclosure, confidentiality, accounting, and reasonable care. By assuming this role, the agent is expected to prioritize the client’s needs and interests above their own, ensuring that decisions are made with the utmost trust and care.

In contrast, the client, whether a buyer or a seller, is the principal in this arrangement and is typically not considered a fiduciary in the same context. While the client does have duties to their agent, such as providing accurate information, they do not have the same legal implications regarding fiduciary responsibilities. Understanding this distinction is crucial in real estate practice as it governs the ethical framework within which agents operate and helps to foster trust between agents and their clients.