A licensee has had a few casual meetings with a potential client. The client has shared the type of home and area they are interested in, and the licensee has suggested a few homes that might match the client's preferences. Although the licensee hasn't explicitly stated they will continue searching for homes for the client, the client believes they will do so. Which of the following statements about this situation is correct?

Dual agency occurs when an agent represents two clients in the same transaction, which does not apply here. The licensee has not formally engaged in dual agency since there is currently no established agency relationship with either the potential client or another agent. The uncertainty about the client's relationship with another agent does not create dual agency.

An express agency agreement requires a clear, mutual agreement typically documented in writing or verbally stated. While the licensee has performed tasks that may suggest agency, there is no express agreement in this situation, as the licensee has not clearly communicated intentions to act on the client's behalf.

This statement is incorrect as the actions taken by the licensee—suggesting homes based on the potential client's preferences—may create an implied agency relationship even before showing homes. The perception of the client that the licensee will continue searching for homes supports the idea of an implied agreement.