Final answer:
In real estate, "your principal" refers to the client a real estate license holder is representing, which could be a buyer, seller, or firm. Agents are responsible for entering into contracts and negotiations on behalf of their principal and must act in the best interests of their client.
Step-by-step explanation:
For real estate license holders, "your principal" is typically the client you are representing in the real estate transaction. As a licensed agent, you may represent a buyer or seller in a property transaction. The principal is the individual or firm that has hired you to provide real estate services, which could involve buying, selling, or leasing property. As an agent, you owe fiduciary duties to your principal, which requires acting in the best interests of the principal and maintaining confidentiality. Real estate agents must enter into contracts and conduct negotiations on behalf of their principals, thus it is crucial to have a clear understanding of whom you are representing in any given transaction.