Agency Disclosure
Working with a REALTOR®: The Agency Relationship
When you work with a real estate agent in buying or selling real estate, the Canadian Real Estate Association requires that you be informed as to whom the agent is representing in the transaction.
Single Representation
As a prospective buyer or seller, you should know that in the absence of a Buyer Representation Agreement, both the agent who lists the property for sale (the listing agent) and the agent who works with a buyer (the sub-agent or selling agent) are agents for the seller.
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The Sellers Representation relationship is established through the Listing Agreement. Their loyalties are owed to the seller, and they must inform the seller of all important information they know which might affect the seller’s decision regarding the sale of the property. The REALTOR® must inform the seller if the buyer is willing to offer a higher price. While neither is the agent of the buyer, they can provide the buyer with information about available properties as well as showing properties and assisting the Buyer with all aspects of preparing an Offer of Purchase. They owe the Buyer duties of good faith, obedience, competence and accountability.
A real estate agent must treat the buyer honestly and fairly. The agent will introduce you to properties, promptly present or deliver offers to the seller and disclose known material facts about the property. The agent will also offer the property without regard to race, creed, colour, sex, marital status, age or country or origin. They will also disclose known facts about current market conditions and may assist you in arranging legal, financing and mortgage advice as well as arranging for a home inspection.
Buyer Representation
A real estate company may be an agent of the buyer. Royal LePage Riveredge Realty Ltd., Brokerage fully and openly offers this service. In this case, it is the buyer who can expect the Agent to represent his or her interests. Agents will fully disclose to buyers all the pertinent facts about a given property. An Agent working for a buyer will also keep information about the buyer confidential from the seller.
Buyer Representation is established through a separate written contract between the Buyer and an Agent. That agreement will explain exactly what services an Agent will provide the buyer, who will pay for those services and what obligations the buyer will have. For instance, a typical Buyer Representation Agreement will commit a buyer to work exclusively with that REALTOR® for a period of time.
A seller can expect from a buyer’s agent an honest representation of a buyer’s offer to Purchase.
Multiple Representation
Occasionally a real estate company will be the agent of both the seller and the buyer in the same transaction. This is called “Multiple Representation”. Under this arrangement, an Agent is obligated to look after the interest of both the buyer and the seller. Since the agent has promised confidentiality, loyalty and full disclosure to both parties, it is necessary to limit these promises in this situation and in addition to these limited promises, the Agent is still obligated to represent both the buyer and seller in the transaction with duties of good faith, obedience, honestly, competence and accountability.
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