[This is an amended version sent by the British Columbia Real Estate Association (BCREA) on June 15 to correct inaccuracies regarding potential conflicts of interest, disclosures regarding remuneration and to add comment on the impact of the rule changes.]
ON June 15, changes to Rules under the Real Estate Services Act that dictate how realtors work with consumers will come into effect. The Rules, mandated by the Office of the Superintendent of Real Estate (OSRE) and finalized on April 27 have been amended to ensure that realtors make adequate disclosures, so that consumers can make informed decisions.
“BCREA, together with the Real Estate Council of British Columbia (RECBC), has been hard at work to update the Applied Practice Courses for new licensees. BCREA has also been updating its 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 changes is a ban on dual agency. 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 RECBC’s Independent Advisory Group in 2016. Exemptions will be possible in limited circumstances. Under the prohibition on dual agency a real estate agent cannot represent two clients with competing interests at the same time.
Realtors, consumers and compensation
From June 15, realtors are required to make more disclosures on the commissions they receive on transactions. Once the amendment comes into effect, a realtor must give the seller a copy of the disclosure form before presenting each offer or counter-offer from potential buyers. This form explains 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 and the ban on limited dual agency will have a negative impact on consumer choice with respect to their selection of realtor in some circumstances,” 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.”
For more information on the rule changes, visit Council’s Knowledge Base.