Rules spook new home sales agents
February 10, 2018
B.C. real estate agents selling new homes fear new regulations from the provincial Superintendent of Real Estate will make their jobs harder.
The Superintendent of Real Estate announced the new Real Estate Consumer Protection Rules in November 2017 and they come into effect March 15, 2018.
The rules ban real estate agents from working with both the buyer and seller of a property—the first such law in Canada.
But the rule is being interpreted to mean that listing agents will be prohibited from selling a home to a potential buyer whom they have had dealings with in the past.
The Real Estate Council of B.C., which will enforce the new rules, defines this as “double recusal” meaning the agent could have confidential information about both the buyer and the seller. In such cases, the buyer would have to either sign an agreement that they will not require agent representation or be required to work with a different agent. If such a buyer presented an offer, the listing agent would also be required to stop working with the seller to avoid a conflict.
Double recusal is seen as particularly onerous for agents selling new homes in smaller communities.
Gordon Clayton of Re/Max Oceanview Realty in Sechelt, B.C. and his team are selling homes in the new Woodlands subdivision. Clayton said that if any of his scores of former clients approached him as a buyer after March 15, he would have to refuse them personal service.
Clayton added that even a conversation with such a potential buyer could result in an “implied agency” which would be against the new dual agency regulations.
“It makes for a far less pleasant experience for everyone,” Clayton said. “And it is not protecting the consumer.”
The fine for breaking the new rules is $250,000 for a real estate agent and $500,000 for a real estate brokerage.