Why Might Your Agent Also Represent the Seller? Japan's Dual-Agency System, Explained

The short answer

In many countries, one broker representing both sides of a home sale is unusual or restricted. In Japan it is routine and legal, and it has a name: ryoute chukai (両手仲介, literally "both-hands brokerage") — one real estate company acting for the seller and the buyer in the same transaction, and collecting a commission from each. Understanding why this is allowed, and what it can mean for you as a buyer, is a genuinely different question from the commission cap itself, which is fixed by law regardless of who the agent represents.

Why it's legal: mediation, not exclusive agency

The relationship between a Japanese real estate company and its client is usually a baikai keiyaku (媒介契約 — a mediation/intermediary contract): the company introduces you to a counterparty and helps the deal along, but it doesn't sign the contract on your behalf the way a power-of-attorney "agent" (代理, dairi) would. Because both the buyer-side and seller-side relationships are this looser mediation arrangement rather than two conflicting exclusive agencies, Japanese real estate practice does not treat one firm handling both sides as the kind of self-dealing that agency law elsewhere prohibits. This is a structural, legal fact about how Japanese brokerage contracts are categorised — not a loophole one company found.

The commission mechanics

The legal ceiling on agent commission — broadly, purchase price × 3% + ¥60,000 + consumption tax, for properties over ¥4,000,000 — applies per side: what a company can charge the seller for representing the seller, and separately, what it can charge the buyer for representing the buyer. If the same company represents both, it can, in principle, collect up to that ceiling from each side of the same transaction. That is the direct financial reason a company has an interest in also finding the buyer for a property it's already listed for a seller.

Kakoikomi: the practice this incentive can produce

The listing agent is normally expected to share a for-sale property with other agents so it reaches the widest pool of buyers — largely via REINS (レインズ), the MLIT-designated, agents-only property database. Kakoikomi (囲い込み, literally "enclosure") describes a listing agent slow-walking or withholding that sharing — for example, delaying REINS registration, or telling other agents' buyers a property is "already under negotiation" when it isn't — specifically so the same company can also find the buyer itself and collect both sides' commission, rather than sharing the sale (and its fee) with another firm.

This is a recognised enough problem that MLIT amended the enforcement regulations of the Real Estate Brokerage Act in June 2024, making it mandatory from January 1, 2025 for agents to register a property's transaction status in REINS — public, an offer already received, or temporarily paused at the seller's request — specifically so a seller can check directly whether their own listing is actually being shown around, rather than relying on their agent's word. That reform runs through the seller's own dedicated screen; as a buyer, you can't check REINS yourself (only licensed agents have access), so the practical tool available to you is different: ask.

What this means for you as a buyer, honestly

Dual agency isn't proof of wrongdoing, and a huge share of ordinary transactions in Japan run through it without incident. What it does mean is that the person showing you a property may not be purely on your side the way a dedicated buyer's agent would be — they may also owe the seller a duty to get the best price, which is structurally the opposite of your interest in a negotiation. Two questions are worth asking plainly, before you're attached to a specific property:

• "Do you represent the seller on this listing too?" — a direct, ordinary question, not a confrontational one.
• "Is this property registered on REINS, and is it also being shown by other agencies?" — a company handling both sides has less incentive to volunteer this.

None of this changes the legal commission cap itself, and it doesn't mean you should avoid an agency that happens to represent both sides of your deal — it means going in aware of whose interests are fully aligned with yours, and whose are split.

This explains general Japanese brokerage practice as of 2026-07-16 and is not legal advice. Whether a specific agency relationship creates a conflict that matters for your purchase is a judgment call for you and, if needed, an independent professional — not something a general article can settle for your situation.