Texas Intermediary in Real Estate: What Dallas Buyers and Sellers Need to Know
Texas bans dual agency. Instead, brokers use the intermediary relationship. Here's exactly what it means, what your agent can and can't do, and when to say no.
What Is the Texas Intermediary Relationship?
Texas law bans traditional dual agency, the arrangement where one agent fully represents both the buyer and the seller in the same transaction. Instead, Texas created the intermediary framework, governed by the Texas Real Estate License Act (TRELA). Here's what it means: when the same brokerage represents both you and the other party, your broker becomes an intermediary who facilitates the deal rather than advocating solely for you.
It's a legal compromise. And understanding it before you sign anything could save you significant money, or at least a lot of confusion during one of the most stressful moments of the transaction.
By Paul Blair | September 18, 2026
When a seller asks their agent "do you have any buyers?" and the answer is yes, from the same brokerage, what used to be a simple handoff is now a legally defined arrangement with rules about what everyone can and can't say.
Same thing happens constantly in DFW new construction: you walk into a model home, fall in love with a floor plan, and the builder's in-house agent offers to write your contract. That agent already represents the builder. What are you agreeing to when you sign?
Texas answered this question decades ago by creating the intermediary relationship. Most buyers and sellers in Dallas have heard the word. Very few understand what it actually does to their deal.
Dual Agency Is Illegal in Texas
First, let's be clear about what Texas doesn't allow. In states like California and New York, a single agent can represent both the buyer and the seller, disclosing the conflict and trying to serve both parties' interests simultaneously. Texas decided that arrangement was fundamentally unworkable and banned it.
What Texas allows instead is the intermediary relationship: the broker can represent both parties, but the broker must appoint separate agents to each side, and those agents operate with specific restrictions on what they can share between the two parties.
This matters in Dallas because of how the market is structured. KW, Coldwell Banker, RE/MAX, and other large brokerages have hundreds or thousands of agents. When your buyer's agent works for the same company that listed the house you want to buy, you're in intermediary territory, automatically, every time.
How Consent Works, And Why It Happens Before You Realize It
The intermediary arrangement requires written consent from both parties. That consent comes through the documents you already sign:
- Sellers agree to intermediary in the listing agreement when they sign with their broker.
- Buyers agree to intermediary in the buyer representation agreement (BRA), the form you now must sign before your agent can show you any home in Texas.
Here's the catch: the intermediary clause is typically buried in the BRA. You might not notice you've agreed to it until your agent calls to say "I have a buyer for your listing", or "I represent the seller of this house you want to make an offer on."
The IABS form (Information About Brokerage Services), the disclosure you receive at first contact with an agent, does not constitute consent for an intermediary arrangement. Only the signed listing agreement or BRA does.
Two Types of Intermediary Arrangements
Texas recognizes two versions, and the difference is significant.
Intermediary With Appointments (Most Common)
In this arrangement, the broker appoints two separate agents, one to represent you, one to represent the other party. Each appointed agent can:
- Offer opinions and advice to their assigned client
- Explain contract terms and what they mean for you
- Negotiate independently on your behalf
- Pull comparable sales and analyze pricing for you
What they cannot do:
- Share your confidential information with the other side (your maximum budget, your seller's floor price)
- Advocate for one party at the expense of the other
- Coordinate negotiation strategy across both sides
In practice, this arrangement functions a lot like separate representation, if both agents take their duties seriously and the broker has actually made formal appointments. The key word is "appointed." It needs to be documented.
This only works when a brokerage has sufficient staffing: a broker plus at least two additional agents or associate brokers. Solo brokers and tiny teams cannot make appointments and therefore cannot do intermediary with appointments.
Intermediary Without Appointments (Rare, But It Happens)
When appointments aren't made, or can't be made due to brokerage size, the broker or agent becomes a neutral facilitator. This version is much more restrictive:
- Cannot give advice or opinions to either party
- Cannot help you strategize or tell you whether you're overpaying
- Must treat both parties identically
One important nuance: even in this arrangement, the broker still has disclosure obligations. If an inspection report comes back with material defects, it has to go to the seller. The broker's duty to disclose material information doesn't disappear just because they can't advocate.
For most Dallas buyers and sellers, this no-advice arrangement is a bad deal. If you're signing an intermediary notice and you're not sure which type applies to your situation, ask directly: "Who is my appointed agent, and what is their name?"
When Does This Come Up in Dallas?
New construction is the most common trigger. Builder-employed agents list the community and write buyer contracts for buyers who walk in without representation. The builder's agent cannot fully advocate for you; they work for the builder. Some large builders have separate sales staff who aren't licensed or are licensed only as buyer's agents, those situations are different, but when a licensed agent represents the builder and wants to write your contract, you're looking at an intermediary arrangement or no representation at all. If you're buying new construction in DFW, getting your own buyer's agent is the cleanest way to get independent advice, and understanding the builder's contract before you sign matters too.
Large brokerage buyers and sellers encounter this constantly. If your listing agent is with KW Dallas and a KW buyer's agent brings an offer, intermediary kicks in. Same brokerage, two agents, but now both of them are operating under restrictions.
Luxury transactions see this too, especially in Highland Park, the Park Cities, and Preston Hollow. High-end listings at smaller boutique firms are less likely to trigger intermediary; large-firm listings are more likely.
Move-up buyers who listed with one agent and are now shopping for their next home with the same agent at the same brokerage may trigger intermediary on their sale if that agent brings in a buyer for their old home.
What You Can Actually Do About It
If You're a Buyer
You don't have to agree to an intermediary arrangement. Here are your options:
Option 1: Say yes and get appointed. If the brokerage is large enough, ask for, and confirm in writing, the name of your appointed agent. That agent can still advocate for you within the rules.
Option 2: Say no. If you decline intermediary and there's a home at that brokerage you want to make an offer on, your agent typically must refer you out or withdraw from your representation. It's not clean, but it's your right.
Option 3: Work with a brokerage that doesn't represent sellers. Boutique buyer's agencies and smaller firms with fewer listings reduce the likelihood of intermediary coming up. Virtual brokerages like Grey Square that don't carry large listing inventories also reduce the risk.
In the current Dallas market, $448,703 median sale price, 50 days on market, about 40% of listings taking price cuts, you want an agent who can tell you plainly whether you're overpaying. That means you need clarity on what your agent can and cannot say before you're in the middle of negotiations.
If You're a Seller
You agreed to intermediary when you signed your listing agreement, but that doesn't mean you're locked in. When your own agent brings a buyer from within the brokerage, ask:
- Who is the appointed buyer's agent?
- Will that agent have full access to my disclosures, inspection reports, and history?
- What confidential information about the buyer's situation can you still share with me?
The short answer to the last question: very little. Your agent cannot tell you the buyer's maximum budget or their level of urgency without the buyer's written permission. That changes your negotiating position.
Some sellers prefer to decline buyer offers from within their own brokerage specifically to preserve their agent's full advocacy. In a market where 39.6% of Dallas listings are taking price cuts, that advocacy, knowing when to hold firm and when to negotiate, has real dollar value.
What the 2026 BRA Changes Mean for Intermediary
Starting in early 2026, TREC formalized the requirement that buyers must sign a buyer representation agreement before an agent shows them any home. This was already the norm for serious buyers, but now it's a firm rule.
Here's why it matters for intermediary: you're signing the BRA before you've seen homes, before you know which brokerage has the listings you'll want, and before you know whether intermediary will come up. The intermediary consent clause in that BRA is now something every buyer should read carefully before signing.
Ask your agent: "If I want to make an offer on one of your brokerage's listings, what happens? Who will be my appointed agent?"
If they can't answer that question clearly, that tells you something.
Frequently Asked Questions
Does Texas allow dual agency?
No. Texas law prohibits traditional dual agency, where a single agent fully advocates for both buyer and seller in the same transaction. Texas uses the intermediary framework instead, which requires a broker to facilitate the deal with separate appointed agents for each side and strict rules about what information can be shared.
Can I refuse the intermediary arrangement in Texas?
Yes. You have the right to decline. If you're a buyer and you don't want to proceed under intermediary with a home at your agent's brokerage, your agent may need to withdraw from representing you on that transaction, or refer you to another broker. It's worth discussing this upfront before you fall in love with a specific property.
What happens if my agent becomes an intermediary and never formally appoints anyone to my side?
Without a formal appointment, the arrangement becomes intermediary-without-appointments, which means your agent becomes a neutral facilitator and cannot give you advice, opinions, or help you strategize. You're essentially on your own. Always confirm in writing who your appointed agent is and that they hold an active, unrestricted license.
Is intermediary common in DFW new construction?
Very common. Builder-employed agents who list and sell for the same builder are frequently in an intermediary position when buyers come in without their own representation. The builder's agent legally cannot fully advocate for you. Getting your own buyer's agent, one from a separate brokerage that doesn't represent the builder, is the cleanest way to get independent advice on new construction.
What's the difference between the IABS form and the intermediary consent?
The IABS (Information About Brokerage Services) form is a required disclosure you receive at first contact with an agent. It explains how brokerage relationships work in Texas. It is NOT consent for an intermediary arrangement. Intermediary consent only comes through the signed listing agreement or buyer representation agreement. If you only received the IABS, you have not consented to intermediary.
The Bottom Line
The Texas intermediary relationship is a legal compromise, it allows real estate transactions to happen within large brokerages, but it comes with real limitations. Understanding those limitations before you sign a listing agreement or a buyer rep agreement is the only way to protect yourself.
If you're buying or selling in Dallas and you want an agent who can advocate for you without restriction, start with a conversation about which brokerage represents the properties you're considering. In a market where 40% of listings are taking price cuts and homes are sitting 50 days, advocacy matters.
If you're thinking about listing your Dallas home and want to know what your property is worth before you sign anything, get your home value estimate here. If you have questions about how to structure your representation, whether you're buying or selling, let's talk.
About Paul Blair Paul Blair is the founder and broker of Grey Square, a virtual real estate brokerage representing buyers and sellers across Dallas and Los Angeles. With 22 years in the business and more than $200 million in closed transactions, Paul works the full range of the market, from luxury homes in the Park Cities and Preston Hollow to estates in the Hollywood Hills and across the Westside. Connect with Paul and the Grey Square team at greysq.com. TX TREC #9011505 · CA DRE #01792671.