Can A Real Estate Agent Represent A Family Member?

Answer for "Can a Real Estate Agent Represent a Family Member?"

Miriam Ruiz, Broker real estate agent
  Mirimar Real Estate & Investments, LLC

Every client is important no matter how big or small is a business. But selling real estate is somewhat different than selling doughnuts or hot dogs. Houses are most likely the most expensive asset that a person will ever buy or sell, so it’s crucial that the process goes smoothe and by the book for everyone. Given the fact that the average Realtor® generates around 12 transactions a year, according to the National Association of Realtors®, who wouldn’t want one extra transaction from a family member?

Well, everything looks good in the beginning, but things could get out of control, communication might not be the best and either the buyer or the seller could feel treated unjustly. Agents can represent a family member but they must disclose it upfront before an offer is placed. For Realtors®, this aspect is clearly specified in the Codes of Ethics. However, there are two things that any real estate agent should consider before accepting to represent a relative.

First of all, is the lack of trust. Your client, although a family member, might not trust you completely or might think that you’ve done too little to get them the highest price for their property. If you don’t have too much experience in the real estate business, your family member could replace you at some point for not having brought the results anticipated. This move might hurt your feelings and could even destroy your relationship.

Secondly, your biased opinion could cause problems. For example, buyers might feel that they’re not getting the best price or might think that you’ve inflated the price so that your relatives get more money. You may feel good about representing a family member, but he/she might feel that you’re too intrusive, as they’ll have to disclose the reason for selling the house (it could be due to foreclosure, due to divorce or other reasons), the defects of the house, their annual income, their credit score, the type of mortgage they want to apply for in order to buy a new home. Not everybody feels comfortable sharing these details with someone they know.

All in all, real estate agents can represent a family member, but they should be aware of the risks and weigh in the pros and cons. Sometimes it is better to let another colleague handle their transaction.

Have a question or comment?
We're here to help.

*** Your email address will remain confidential.

Comments for Can A Real Estate Agent Represent A Family Member?

Dawn Loller Dawn Loller said:

We put a contract to buy a home that had a Short Sale approved. The realtor's family owns the property and it had a reverse mortgage. Is there a conflict of interest for the Realtor ? We gave our earnest money on 6/1/2020 and the realtor's family (brother and sister) are still living in the home. We feel he is purposely slowing the sale down so they can live in the house longer since it is a reverse mortgage that the parents had. The last parent died in Jan 2019. It has been close to 90 days and we don't have an approval from HUD or Novad Consulting. Our realtor has done little to move the sale to a close. They are relying on the Seller's Realtor to tell them the truth.

Aug 23, 2020  10:08:32

Real Estate Agent

Hey, Dawn!

We are sorry to hear about your situation, but unfortunately in this case we can't say for sure if there is a conflict of interest in the middle. It would be better if you could reach out to a real estate attorney, that would help you figure out the situation.

Sep 10, 2020  07:56:08
Brandy Brandy said:

Real eastate agent rejected full price offer no contingencys to sell to family member. Is that legal

Jul 04, 2020  00:59:43

Real Estate Agent

Hey, Brandy! Homeowners can reject an offer if they wish, and to be honest there are a lot of reasons why your offer can get rejected. However, if a homeowner rejects an offer for the wrong reason this could lead to legal action taken against the homeowner. Valid reasons to reject an offer are for example, offers that were not high enough or the homeowner is not sure if the buyer will be able to get a loan. Unlawful reasons to reject an offer are housing discriminations such as an offer being refused for reasons regarding the buyers sex, race, national origin, or familial status. We also have an article that talks about the top five reasons why your home offer was rejected, so you can check that out if you are interested.

Jul 10, 2020  08:15:33

Related Real Estate Questions


Related Real Estate Glossary Terms