👆🏽 Brent Faiyaz - World Tour - F*ck the World It's a Wasteland Tour - Live in Milan at @Fabrique - 12/11/2023
The U.S. real estate industry’s so-called “Chinese wall” separating buyer and seller representation is about as flimsy as a college carpet. The Houlihan Lawrence lawsuit and the recent $418 million NAR settlement were supposed to usher in a new era of transparency and consumer empowerment.
Why?
… because dual agency is still legal in 40+ states.
Dual agency is when the same brokerage and sometimes even the same person represents both sides of a transaction. If you are in one of the blue states referenced below then you are supposed to be provided a disclosure if / when they engage in this duality.
Your broker might refer to Designated Agency. This is where Marcy assigns Karen to the seller and Julie to the buyer, both under the same roof, both sharing the same office gossip and commission pool.
They’re supposed to keep secrets from each other.
But in practice, the incentives are aligned to close deals for the MAX price and buyers’ MAX pain.
The brokerage wins twice, and we consumers are left thinking …
The $9 million Houlihan Lawrence settlement addressed claims of inadequate dual agency disclosure for residential real estate transactions in Westchester, Putnam, and Dutchess counties, New York. Plaintiffs alleged the firm failed to inform homebuyers and sellers of conflict risks when representing both sides in deals. The settlement, court-approved as fair and reasonable, mandates $9 million to compensate affected parties and the permanent end of Houlihan Lawrence’s “in-house bonus” program. The litigation’s broad geographic scope underscores the case’s significance for increasing transparency and safeguarding consumer interests throughout these Hudson Valley counties.
The recent settlements have done little to change this dynamic.
Buyers now sign agreements about agent compensation before touring homes, yet the conflict of interest persists. The real estate lobby is betting that consumers are too busy / lazy to read the fine print. So far they are correct.
If rates are cut soon as has been signaled - it will drive real estate deal-flow. And then we should all watch to see whether citizens increasingly lobby regulators to push for a true ban.
Houlihan Lawrence is a poster child for the deep-rooted conflicts of interest in U.S. real estate, especially around dual agency. In 2017, I was 10-days away from a closing (as the buyer) when we self-discovered pending private litigation involving our intended home - yep you guessed it - it was a dual agent situation. However this was prior to the Houlihan lawsuit about the very conflict-of-interest involved in our deal - therefore we didn’t even receive disclosure.
What Happened with Houlihan Lawrence?
The class-action lawsuit (Goldstein et al. v. Houlihan Lawrence Inc.) alleged that the brokerage systematically failed to disclose the true nature of dual agency, breaching fiduciary duty to both buyers and sellers.
The court granted final approval to the settlement in August 2025, but the core issue - agents representing both sides of a transaction - remains largely unresolved in practice.
Why the Settlement Didn’t Fix It
The recent NAR and Houlihan Lawrence settlements focused on transparency and disclosure, not on reforming dual agency.
Agents are still allowed to represent both sides, as long as they get written consent. But this is a bunch of bullshit - because a disclosure is almost never given prior to the “highest and best” offer stage of the game - as it is not legally mandated.
So information and incentives keep flowing freely within the firm.
Dual agency is a profit center … double the commission, half the accountability.
The same brokerage leverages inside information to maximize its own revenue.
Until dual agency is banned or radically restructured, the system will remain fundamentally conflicted.
For Entrepreneurs:
There’s a huge opportunity for new platforms that guarantee single-agent representation and radical transparency.
I was nothin' at all
Took a trip to London just to hear how they talk
Back to 4-1-0
You should hear how they talk.
-Brent Faiyaz
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