PSI Virginia Real Estate Practice Exam

In real estate, who is referred to as an agent?

1. A buyer looking for a property

2. A seller of real estate

3. A person acting on behalf of another

4. A broker providing market analysis

The correct answer is: A person acting on behalf of another

In real estate, the term "agent" specifically refers to a person who acts on behalf of another individual in a capacity that involves negotiating and facilitating transactions, such as the purchase or sale of property. This role is critical because an agent has the legal authority to represent their client's interests, ensuring that the transaction adheres to relevant laws and guidelines. When an agent represents a buyer, they work to find suitable properties that meet the buyer's needs and negotiate favorable terms. Conversely, if the agent represents a seller, they market the property and negotiate with potential buyers to achieve the best possible price. The fiduciary duty inherent in this relationship means that the agent must prioritize their client's interests at all times. While the other options describe individuals involved in real estate transactions, they do not encapsulate the specific role defined as an agent. A buyer looking for a property and a seller of real estate are parties to a transaction, while a broker providing market analysis may assist in the transaction process but does not inherently act as an agent unless they are officially representing a client in that capacity. Thus, the definition of an agent is precisely about the proxy relationship established between a representative and their client in real estate dealings.