It is a situation i personally would not want to get involved in. However if an agent found him/herself they would have to disclose the same facts about the house to both parties such as if there was another offer, what motivations the seller has, any deadlines the seller has. The key for you is to ask alot of questions and be specific to the agent. It is not illegal for teh agent, and sometimes it happens. Realtor A is working with client 1 and puts in an offer. Client 2 drivesby the house and wants to see it, now they want to put in an offer. The scenario's just grow from there. Your key is to watch out for yourself and ask ask ask.
I understand your redirect. No it is not illegal for them to be looking. I prefer not to from the standpoint of negotiating. Yes you can treat both clients equally until as it was mentioned it comes time to turning in offers. I prefer to not get into that. I have clients in the same price range all the time I have yet to have two go after the same home though. If it came to that I would refer one out.
OP asked if it were possible to treat both customers (?) clients (?) equally..... if I show a house to someone, does that mean it is unethical for me to show it to someone else? Does it become unethical because the first someone put an offer in? I say "someone" because I have no idea if the OP's agent was acting as a buyer's agent for either of them.
I asked for clarification because although I believe it would be difficult to treat each CUSTOMER equally, I believe it would border on unethical if one or both were CLIENTS. In either case, I don't believe it is illegal to submit offers for 2 customers.
I would agree with the other agents here. While it may be legally possible if you were to agree to it (that's an important element), it would definitely not be advisable. You are not at the mercy of the agent here since you are the principal and the agent can't do something to which you don't agree. While you can't stop the other agent from writing an offer for another buyer on a house in which you are also interested, you don't have to agree to your agent writing up the offer for you as well. Once he has written an offer for someone else, he needs to tell you and refer you to someone else or let you choose another agent. Here's something that I found on the consumer advisory section of the website for the New Hampshire Real Estate Commission:
"Even though real estate professionals must always present properties honestly and accurately under the law, you must specifically hire an agent - using a written hiring contract - before that person legally owes you a duty of loyalty. Otherwise, that agent may ultimately be hired by a seller, and have a legal duty to disclose to that seller any information that you have revealed
Until any agent actually contracts to represent your interests in a real estate transaction, do not disclose any information to him/her that you would not want a seller to possibly know."
While the above statement does not directly address your situation, it does make it clear that the agent does not owe you a duty of loyalty until you have signed a written agreement. In other words, unless you have signed such an agreement, the agent does not owe you a duty of loyalty. Once you have signed up to work with this agent, the agent owes you a duty of loyalty and in my opinion that would include not writing up an offer for the same property for someone else simultaneously unless both buyers were to agree to it (which is highly unlikely). I hope this helps put things into perspective. Good luck to you.
Since you have inside information on one of the "other" offers (because it's your client), you can't really offer objective negotiation advice to either of the clients, and therefore you become far less useful and effective to your clients. The best thing to do is recuse yourself by doing as Larry suggests and referring one of those clients to a different agent in your office (or a different office, for that matter).
The fact that your realtor is working with someone else interested in the same house, isn't a conflict of interest, until BOTH of you decide to write an offer on that property. Up until then, you just have two clients interested in the same property. But once the second client decides to write an offer, they should be "told" that you have a conflict of interest, and referred out.