What is 'designated agency' (also called 'split agency')?

Designated agency is an alternative to traditional dual agency in many states. When the buyer and seller are both represented by licensees within the same brokerage, the managing broker designates one licensee to represent the buyer exclusively and another to represent the seller exclusively. The designated licensees can advocate fully for their respective clients. The managing broker oversees the transaction as a neutral, with duties to both parties. Benefits over traditional dual agency: each party gets full fiduciary representation; sensitive information is not shared between the two licensees (subject to walls within the brokerage); the conflict is contained at the managing broker level. Implementation requires: written disclosure to both parties of the designated agency arrangement; appropriate confidentiality protections; clear designation in writing; managing broker awareness and consent. Designated agency is authorized by statute in many states and is often the preferred approach when dual agency would otherwise apply. Designated agency does NOT apply when one licensee represents both parties — that remains traditional dual agency requiring full disclosure and consent. Brokerages should have written policies clearly distinguishing the two situations.