Real estate agents can represent you as either a buyer (Buyers Agents) or as a seller (Sellers Agents). In June 2012 the law changed in BC. So did the way that you could be represented by a real estate agent when you buy or sell Comox Valley homes. It does not matter whether you are buying land or buying a home.
The professional relationship that can exist between you and a real estate agent is established in the Law of Agency in British Columbia.
- Prior to 1994, under “Seller Sub Agency”, all real estate agents worked for the seller;
- From 1994 – June 2012, under “Assumed Buyer Agency”, real estate agents could work for buyers and sellers BUT there were many instances where Limited Dual Agency relationships were offered and entered into; and
- In June 2012, under “Designated Agency”, exclusive representation for buyers and sellers became more readily available in most situations
Think of representation in a legal setting. Let’s assume that you have been involved in a car accident and are injured. The insurance company of the person who caused the accident and your injuries offers you a settlement. What do you do? Conventional wisdom says that you obtain a lawyer to represent you and your interests. That insurance company will certainly not be looking out for your interests. You can bet that that insurance company has lawyers to represent their interests, and that they will not be concerned with yours.
Now, turn to the Comox Valley real estate setting. Can you think of any reason why would Comox Valley home buyer would not want to be represented exclusively by a real estate agent? Until Designated Agency was introduced, this was not an option in too many different situations.
Between 1994 and June 2012, let’s say that you saw a a number of specialized Comox listings of homes online and wanted to know more about them. Let’s say the listing was held by RE/MAX Ocean Pacific Realty (the brokerage) and the listing agent (an agent of the brokerage) was Agent A. Agent A was hired by the seller to represent them and their interests. Perhaps not commonly understood during this time period was the fact that the seller had also hired the brokerage to represent them and their interests. If a person wanted to place an offer on this listing and they were represented by any agent at the same brokerage that had the listing, they would have had to enter into a Limited Dual Agency relationship to do so. When this occurred, the brokerage represented the interests of both parties. In theory and law, both parties were to be treated impartially. If two different agents at the brokerage were involved, they had restrictions placed on them as to what they could and could not do for their clients. If the buyer called the listing agent to place an offer on the property, the same Limited Dual Agency would apply BUT both parties were supposed to have been treated impartially by both the Brokerage and the individual agent. If this were a legal issue, would you want to have one lawyer represent both parties in a lawsuit impartially? Why then would you want this type of relationship when you were buying or selling your most expensive investment? Clearly, others agreed and “Designated Agency” was introduced.
Under Designated Agency, the brokerage that has the Courtenay real estate listing is no longer a major determinant of the type of agency representation that could apply to a specific situation. Buyers and Sellers can now be exclusively represented by an individual real estate agent regardless of the brokerage affiliation of the agent. Under this new law, limited dual agency can still be used as follows: 1. when two or more buyers working with the same agent want to place an offer on the same home at the same time; and 2. when a buyer working with agent A wants to place an offer on a home listed by Agent A. Because of this narrowed application, Limited Dual Agency should not be nearly as prevalent as it may have been in the past. As well, there are alternatives to Limited Dual Agency in these two situations. First, one person can be offered no agency relationship and be treated as a customer. Second, one person can be referred to a different agent so that they and their interests are exclusively represented. Why would you not want to be exclusively represented throughout the real estate buying process ?
To find out more, contact Brett Cairns of RE/MAX Ocean Pacific Realty and to talk to him about exclusive representation as a real estate client.