Written by: Elliot Funt, Real Estate Advisor, Engel & Völkers Vancouver
Originally posted June 15, 2018. Updated March 5th, 2021.
REBGV News Release:
On June 15, 2018, new real estate rules came into effect that change how REALTORS® and their clients can work together in different circumstances.
These rules state that real estate licensees across our province can now only represent one party in a transaction and must provide additional documentation about representation and compensation.
So, the next time you go to buy or sell a property, your Realtor is required by the government to go through some additional forms to explain how or whether you’re being represented and to clarify the compensation that you’ll pay. Of course, Realtors can still give factual information about the properties they list for sale without providing you with this additional documentation. This, however, would change if you wanted to ask them for advice or to reveal any personal information, e.g. your situation; what you’d like to buy or sell, why; etc.
There may also be times under the new rules when your Realtor is unable to represent you because they’re already representing another client in the transaction. In these situations, there are some options you can consider, and a Realtor would be happy to explain them to you.
“These new rules and forms change processes and documentation that have been in place in our province for decades. Our more than 14,000 Realtor members are working hard to comply with these regulatory changes,” Phil Moore, Real Estate Board of Greater Vancouver president said. “We ask for the public’s patience during this adjustment period. The new forms and disclaimers are required government changes and we’re doing our best to comply with them while serving your needs.”
My Take:
While the new rules create a little more paperwork for both you and me, I think they are an excellent move overall. Even before the rules were implemented, I never once put myself in a position where a major conflict of interest arose: such as Limited Dual Agency. Always feel free to ask me more about these new rules.
Disclosure of Representation in Trading Services Form
This form is in no way a contract between me and you. If you have previously bought or sold a home, you may remember signing the Working With A Realtor® form. The main form "Disclosure of Representation in Trading Services" essentially replaces the old Working With A Realtor® form. The form is simply the required paperwork from the Real Estate Council of British Columbia. The Disclosure of Representation in Trading Services form is just an acknowledgement that I've told you about the various forms of agency. I'm not asking you to sign these forms to put you in a contractually binding agreement, it is just the basic required paperwork for me to assist you. If another agent is working for you and has not yet given you these forms, you should know that they are skipping steps.
Agency
You have two main options when completing a real estate transaction, you can either choose to be a Client (you have agency) or to be an Unrepresented Party (no agency).
What to Expect as a Client
When you become a client of a real estate professional, they owe you special legal duties as your agent:
Loyalty: they must put your interests first, even before their own.
Avoid conflicts of interest: they must avoid any situation that would affect their duty to act in your best interests.
Fully disclose relevant information: they must give you all the facts they know that might affect your decisions.
Protect your confidentiality: they must not reveal your private information without your permission, such as:
your reasons for buying/selling/leasing/renting
the minimum/maximum price you are seeking
any preferred terms and conditions you want to include in a contract.
What to Expect as an Unrepresented Party
If you choose not to have a real estate professional represent you, you are an unrepresented party. You are not entitled to the special legal duties a client receives.
No loyalty: the real estate professional involved in the transaction are representing clients with competing interests to yours. They must be loyal to their clients, not you.
No duty to avoid conflicts: no real estate professional is acting in your interests.
No full disclosure: the real estate professionals involved in the transaction do not have a duty to give you all relevant information.
No confidentiality: the real estate professionals involved in the transaction must share any information you tell them with their client.
Note: if you choose to be an unrepresented party and are completing a transaction with me (most likely to occur when you are a buyer without an agent, and I am assisting the seller). I still need you to sign the Disclosure of Representation in Trading Services form, as well as another form called Disclosure of Risks to Unrepresented Parties. I also encourage you to find representation with another agent; alternatively, I am also happy to recommend another colleague of mine.