In real estate, like many other fields, professional representation is available for every step of the process. How much or little representation you need or want will depend on your knowledge and background in real estate, as well as the amount of time you have to dedicate to the process.
The purchase or sale of real estate has significant financial implications for those involved, although the way in which the transaction unfolds can have more significant consequences for those involved than the price tag.
“It’s critical to understand your comfort level going in. Buying or selling a home is the largest financial transaction that most people will ever be a part of and you want to ensure that all aspects of the transaction are handled in an efficient manner that helps protect you,” said Jake Moldowan, Real Estate Board of Greater Vancouver president 2010/2011 .
“REALTORS® provide clients with professional representation in a real estate transaction. As your agent, they are duty-bound to work and advocate in your best interest.”
REALTORS® provide a broad range of services, depending on their individual business models and the agreement between you and your REALTOR® as to which services you want.
Depending on that agreement, services may include helping you determine the value of your home if you’re a seller, or helping you establish a reasonable purchase offer if you’re a buyer.
It may include listing a property for sale on the Multiple Listing Service® (MLS®) to bring it to the attention of REALTORS® working on behalf of buyers. It may include marketing a property on www.realtor.ca or www.realtylink.org, in a local newspaper, on signs, via open houses or other advertising vehicles. It may include seeking the REALTORS® help to negotiate the sale if you’re the seller, or to negotiate a purchase price and conditions if you’re a buyer. It may include seeking a REALTORS® advice on conditions and appropriate subjects.
There are a lot of ‘mays’ in the range of potential services, again depending on a REALTORS® specialties, i.e. residential, commercial, the types of services a REALTOR® offers, and the types of services you choose.
What’s equally valuable is the level of protection you gain from hiring a REALTOR®. Buying a home is the most significant purchase most people make in a lifetime. A REALTOR® brings assurances and safeguards to the process.
Each stage of the transaction occurs in front of a well-regulated backdrop created over many years to protect the public. This includes REALTOR® insurance, an assurance fund, and multiple avenues of recourse if someone feels their agent did not act in accordance with their professional and contractual obligations. Those avenues include the Real Estate Council of BC and the appropriate real estate board. ∧ top
Here’s a more comprehensive list of the protections that come from working with a REALTOR®:
Standards, legislation and requirements
The real estate profession is one of the most highly regulated in the country. The Real Estate Council of BC is a regulatory agency established by the provincial government to protect consumers through the licensing of all individuals who practice real estate in the province. The conduct requirements for all real estate licensees and brokerages include:
1. Undivided loyalty. The brokerage must protect the client’s negotiating position at all times, and
disclose all known facts, which may affect or influence their decision.
2. Obey all lawful instructions of the seller.
3. Keep the confidences of clients.
4. Exercise reasonable care and skill in performing all assigned duties.
5. Account for all money and property placed in a brokerage’s hands while acting for the client.
The above speaks to the minimum required under the Real Estate Services Act.
REALTORS® are subject to a higher standard. As members of their local real estate board, REALTORS® are also required to adhere to the Canadian Real Estate Association’s REALTOR® Code and Standards of Business Practice.
Both the Real Estate Council of BC and the 12 provincial real estate boards use an investigatory and disciplinary process to deal with complaints. REALTORS® who are found to have breached either the legislation or the REALTOR® Code are subject to sanctions by their board and/or the Real Estate Council. ∧ top
Seller duty to disclose
In 1991, the BC Real Estate Association, the provincial association for REALTORS®, introduced the Property Disclosure Statement (PDS). This document is a detailed form that asks a property seller to disclose any defects to a prospective buyer. This document is not required by law, however, the REALTORS® of BC decided to make the PDS (and its complementary forms, the Strata Property Disclosure Statement and the Rural Property Disclosure Statement) available to any client wanting to list a home on the MLS®. The PDS can be legally incorporated into the Contract for Purchase and Sale.
The PDS goes beyond current legal disclosure obligations and requires that potential problems be itemized for prospective buyers, such as buried fuel storage tanks, asbestos insulation, unauthorized rental suites, renovations done without a permit, moisture problems, unregistered easements or encroachments, and whether the home was ever used as a grow-op or drug lab.
Although the PDS is never a substitute for a thorough, professional home inspection, it is a great place for buyers to begin their due diligence investigation into any home they are hoping to purchase.
By choosing to make the PDS mandatory, the REALTORS® of BC sought to provide the public with an additional level of certainty when they purchase a home; notwithstanding that a signed PDS Form is required for a listing to be posted to the MLS® Service, sellers are not obligated to answer its questions.
Special Compensation Coverage
The Real Estate Special Compensation Fund was introduced in 2005 under the Real Estate Services Act. It provides protection for property buyers and sellers who have lost deposit monies entrusted to a real estate licensee or an unlicensed individual related to the brokerage, for example, a receptionist, director or officer) that is misappropriated, wrongfully converted, intentionally not paid or accounted for or obtained by fraud. As a condition of licensing, it is mandatory for all licensees to participate in the fund.
Transaction deposits held by real estate brokerages are protected by the Special Compensation Corporation and are held by the REALTORS® brokerage as the stakeholder until the transaction completes or the parties give instructions as to the disposition of the deposit. Deposit monies can only be removed from a brokerage trust account under specific circumstances. Check with your REALTOR® for more information. ∧ top
Errors and Omission insurance
REALTORS® in BC are required to have Errors and Omission Insurance – a compulsory program created under the Real Estate Services Act. The insurance protects property buyers and sellers and indemnifies licensees against liability arising out of negligently failing to perform duties in relations to the provision of real estate services.
Recourse for the public
Both the Real Estate Council of BC and the 12 BC real estate boards have an investigatory and disciplinary process to deal with complaints. REALTORS® who are found to have breached either the legislation or REALTOR® Code are subject to sanctions by their board and/or the Council.
Real estate boards deal with breaches of the REALTOR® Code. The Real Estate Council of BC deals with breaches of the Real Estate Services Act.
The Professional Standards Department at the Real Estate Board of Greater Vancouver (REBGV) educates members about professional conduct, and resolves and mediates complaints and concerns of both members and consumers. Where a resolution isn’t possible, files can be forwarded to the Board’s Professional Conduct Committee for further review.
The Real Estate Council enforces entry qualifications, investigates complaints and imposes discipline under the Real Estate Services Act. The Real Estate Council of BC website is www.recbc.ca.
REALTORS® complete educational and licensing requirements and must be of good reputation in order to become licensed.
REALTORS® are committed to continuing education and consistently refine and improve their skills and professional knowledge through participation in the profession’s required Professional Development Program.
Every two years, REALTORS® must complete a required number of course credits as a condition of continued membership in their Board. These courses are designed to keep REALTORS® up-to-date with new and changing information relating to real estate.
As licensees, REALTORS® are also required by the Real Estate Council of BC to complete a re-licensing education program every two years.