Final answer:
Intermediary brokerage was created to replace statutory dual agency, facilitating real estate transactions neutrally without representing either the buyer or seller with loyalty. This model allows for fair dealings and avoids the conflicts of interest associated with dual representation.
Step-by-step explanation:
In response to the question about what was created in place of statutory dual agency, the answer is intermediary brokerage. Dual agency occurs when a single real estate agent or broker represents both the buyer and seller in a transaction, which can lead to conflicts of interest. To address this issue, some states have allowed the practice of intermediary brokerage. An intermediary brokerage facilitates the transaction between the buyer and seller but does not represent either party with loyalty to avoid the issues that arise with dual agency. Instead, they work to facilitate the transaction in a neutral manner possibly using appointed associates to work with the buyer and seller separately, under the umbrella of the intermediary brokerage.
The implementation of intermediary brokerage seeks to maintain a fair playing ground for both parties involved in the real estate transaction without the conflicts that may arise from dual representation. It's vital for consumers to understand the type of agency relationship they have with their real estate professional, whether it's a single agency, cooperative brokerage, intermediary brokerage, or a form of sub-agency or non-agency. These distinctions are important in real estate law and regulation.