From June 15, consumers can expect that Realtors will make more disclosures on the commissions they receive on transactions. Buyers and especially sellers are most likely to notice the impact of this Rule change when it comes to multiple offer scenarios. Once the amendment comes into effect, every time an offer or counter-offer is made to a seller, the seller’s Realtor will be required to present the seller with a completed disclosure form that explains exactly how much remuneration the Realtor’s brokerage will receive. Another big change is a ban on limited dual agency. Limited dual agency occurs when a Realtor represents more than one party in a real estate transaction. That can be a buyer and a seller, two or more buyers, or a landlord and a tenant.
VANCOUVER – Big changes are coming to how realtors operate and they came to effect on Friday, June 15.
The new Rules under the Real Estate Services Act will dictate how Realtors work with home buyers and sellers. The Rules, mandated by the Office of the Superintendent of Real Estate (OSRE) and finalized on April 27, 2018, have been amended to ensure consumers have a thorough understanding of their relationship with their Realtor, particularly when it comes to conflicts of interest and remuneration.
“Since the new Rules were finalized six weeks ago, The BC Real Estate Association (BCREA) has been hard at work to update our Applied Practice Courses for new licensees, continuing education courses and nearly two dozen standard legal forms that have been impacted by the changes,” said British Columbia Real Estate Association (BCREA) CEO Darlene Hyde. “The new rules governing real estate practices mark a significant shift in how Realtors in BC work with their clients. It’s important that consumers know what to expect when the changes come into effect.”
Realtors, Consumers And Conflicts Of Interest:
One of the big changes is a ban on limited dual agency. Limited dual agency occurs when a Realtor represents more than one party in a real estate transaction. That can be a buyer and a seller, two or more buyers, or a landlord and a tenant. The ban was recommended by the Real Estate Council of British Columbia’s (RECBC) Independent Advisory Group in 2016. Exemptions will be possible in limited circumstances.
As part of the Rule amendments, a Realtor will inform a consumer at the beginning of their working relationship that the Realtor may be required to stop representing the consumer mid-transaction if a potential conflict of interest arises. A conflict of interest can occur, for example, when a buyer who the Realtor has previously represented makes an offer on a property belonging to a seller the Realtor is currently representing. In such instances, the Realtor may be required to refer the seller to another Realtor.
Realtors, Consumers And Compensation:
From June 15, Buyers and sellers can expect that Realtors will make more disclosures on the commissions they receive on transactions. Buyers and especially sellers are most likely to notice the impact of this Rule change when it comes to multiple offer scenarios.
Once the amendment comes into effect, every time an offer or counter-offer is made to a seller, the seller’s Realtor will be required to present the seller with a completed disclosure form that explains exactly how much remuneration the Realtor’s brokerage will receive.
This form will also explain how the commission will be shared with other brokerages involved in the transaction (the buyer’s brokerage) and any other payments the Realtor expects to receive as a result of the transaction.
BCREA and the 11 member boards have been working with RECBC and OSRE to make these changes as seamless and as transparent as possible. We are actively working to educate Realtors on the implications of these changes so they can continue to serve consumers with integrity and professionalism when the Rule changes come into effect.
“These changes will profoundly alter for the foreseeable future the way consumers initially interact with their Realtor,” said Hyde. “BCREA has done its utmost to facilitate the transition to the new Rules and we stand behind a strong regulatory regime, informed and knowledgeable customers and professional Realtors.”
