It is important to understand that in British Columbia, the person you hire to assist you to purchase your home must be licensed under the provincial Real Estate Services Act.
In every real estate transaction there is a seller and a buyer. A real estate licensee may be employed as an agent for the seller, as an agent for the buyer, or both. Early in the first meeting with a real estate licensee, the licensee should provide you with full disclosure about the nature of his or her relationship with you, as a buyer, and any relationship he or she may have with the seller. The licensee is required by law to provide this information and explain its implications to you.
Real estate licensees work within a legal relationship called agency*. The agency relationship exists between you, the principal, and the brokerage, the company under which the individual licensee who is representing you, is licensed. The essence of the agency relationship is that the brokerage has the authority to represent the principal in dealings with others.
When a seller employs a real estate licensee to help sell his or her property, the licensee becomes the agent of the seller. As a buyer, it is possible for you to select a licensee to act as your agent. It is in your interest to obtain the licensee’s consent to represent you. As a buyer, you become the principal and the licensee becomes your agent.
Brokerages and their licensees are legally obligated to protect and promote the interests of their principals as they would their own. Specifically, the brokerage has the following duties:
You can expect competent service from your brokerage, knowing that the company is bound by ethics and the law to be honest and thorough in representing a property listed for sale. Both the buyer and the seller may be represented by their own brokerages in a single transaction.
Dual agency occurs when a brokerage is representing both the buyer and the seller in the same transaction. Since the brokerage has promised a duty of confidentiality, loyalty and full disclosure to both parties simultaneously, it is necessary to limit these duties in this situation, if both parties consent.
If you find yourself involved in a transaction where the same brokerage is working with both the seller and the buyer, before making or receiving an offer, both you and the other party will be asked to consent, in writing, to this new limited agency relationship.
This relationship involves the following limitations:
The brokerage will not disclose that the buyer is willing to pay a price or agree to terms other than those contained in the offer, or that the seller is willing to accept a price or terms other than those contained in the listing.
You may also choose to use the services of a licensee without having any kind of agency relationship. This might occur, for example, when you are being shown a property by the seller’s licensee.
The licensee you choose to work with in this manner has a legal and ethical duty to provide you with accurate, honest answers to your questions and can provide all these services:
Explain real estate terms and practices
Provide and explain forms used
Assist you in screening and viewing properties
Inform you of lenders and their policies
Identify and estimate costs involved in a transaction
Assist you in establishing your range of affordability
Prepare offers or counter-offers at your direction
Present all offers promptly
A licensee who is not your agent cannot:
Recommend or suggest a price
Negotiate on your behalf
Inform you of his or her principal’s bottom line
Disclose any confidential information about his or her principal unless otherwise authorized.
You should not provide a licensee who is not your agent with any information that you would not provide directly to his or her principal.
Remember, it is possible to enjoy the benefits of a licensee’s knowledge and experience, regardless of whom that licensee is representing.
You can expect licensees to provide you with such services as:
Helping you to clarify the type of property you need and can afford
Providing information about available properties and sources of financing
Arranging appointments to view available properties
Providing accurate answers to any questions you may have about a specific property you are considering
Explaining the forms used in a real estate transaction and assisting you in making a written offer to purchase
Presenting your written offer to the seller
Familiarizing you with the steps you must take to complete the purchase after the seller accepts your offer.
Keep in mind that if the licensee with whom you are working is the seller’s agent, any information you give to him or her must be passed on to the seller. It is in your best interest to discuss with that licensee only what you would discuss with the seller in person.
*Agency descriptions have been adapted from the Working With a Realtor brochure and used with kind permission from the British Columbia Real Estate Association.
Buying a home is one of life’s major decisions, so it makes sense to seek advice from an experienced realtor. But with more than 8,000 licensed realtors in Greater Vancouver, how do you choose one that’s right for you?
Start by asking your family and friends about their home buying experiences using a realtor. Was their realtor easy to work with and responsive to their needs and questions? Was their realtor someone they would use again?
Another idea is to check neighbourhood For Sale signs and get the names of local realtors. By making a point of going to open houses, you’ll also be able to meet realtors in person and casually interview them. Even if they don’t work in the area where you want to buy, most realtors are happy to recommend someone.
Once you’ve chosen realtors to interview, it’s a good idea to draw up a list of questions to ask each of them. Keep in mind that all realtors must adhere to a strict code of ethics, statute law (the Real Estate Act of BC) and a high standard of practice.
As well, your realtor should:
Explain complicated forms used in the transaction;
Help you adopt a sound negotiation strategy and negotiate on your behalf;
Keep you informed about market trends, assessments, future development plans, taxes, zoning, transportation and more.
Help you start your search. They’ll help you consider your lifestyle, your needs and your requirements – and rate them.
Give you information about the community where you plan to buy, including schools, shopping, community centers, parks and great coffee places.
Talk to their network of realtors to find the property you want quickly, and they can get you appointments to see it.
Save you time by matching your requirements with homes listed for sale on the Multiple Listing Service® (MLS®), a computerized information-sharing network of homes for sale.
Be your agent. Realtors have a legal obligation to uphold the integrity of their clients, and protect and promote their clients’ interests.
Recommend other professionals, like certified home inspectors, lawyers/notaries, insurance agents and movers.
Vancouver Realtor and Real Estate specialist Adan Sprauer