New rules prohibiting real estate agents from working with both the buyer and seller of a property come into effect on Friday, and even though there have been some revisions, there is still worry from some in the industry that they will lead to frustration and confusion.
“So many people do not understand what’s happening. There have been lots of emails, but it’s not clear what’s expected. We have been discussing potential scenarios, but it’s very difficult to know what (will be considered) right,” says Mark Wiens, a realtor at Sutton West Coast Realty.
The new rules were first announced in November 2017 by the Office of the Superintendent of Real Estate following cases of misconduct in Metro Vancouver and concerns that, in a red-hot market, consumer interests were being exploited for realtor gains.
Implementation was scheduled for March 2018, but a three-month extension was granted because the real estate industry called for more time to discuss changes and arguments that blanketing the province with the same rules didn’t take into consideration the situation in smaller, more remote markets.
On Thursday, B.C. Green Party leader Andrew Weaver called on the minister of finance and the office of the superintendent of real estate to extend the timeline further.
“The rules changes are significant and penalties for non-compliance are substantial, yet the implications and means of implementation of the new rules are still not well understood in the industry,” said Weaver. “Real estate professionals across B.C. are bringing forward stories about inaccurate and conflicting information, and inadequate training regarding these new rules.”
Wiens is actually in favour of the new rules. “Banning dual agency makes sense in Vancouver. … It’s very hard to separate the interests of one client from another. Technically, it can be done, but, in (such a) situation, I wouldn’t trust myself.”
That said, he, like others, isn’t sure about the practical aspects of putting a ban in place since it will rely on parties ticking off boxes and signing disclosure forms.
“People might not realize they aren’t as protected. Before you have to get a signing-off form from the seller, you could say, ‘Let me tell you everything I know about this property or buyer,’ and then (just) sign the form afterwards,” declaring compliance.
He says it’s not clear yet how different actions and interpretations in a time-sensitive deal might get assessed.
There are currently fewer multiple offers in a market that has slowed considerably, but there are some deals that will present challenges, says Wiens. “Good luck sorting it out. Trying to keep information about three different people and keeping straight that it’s about what can you disclose and what you cannot.”
“The rules are so loosey-goosey. There are no strong definitions,” says Michael La Prairie, president of the Real Estate Brokers Association of B.C., citing other examples where agents will have to make judgement calls.
“There was an extension period, but we haven’t been at the table. We asked for a delay to get clarification, (but) some scenarios are still vague.”
Forbidding “double recusal” or listing agents from selling a home to a potential buyer with whom they have had dealings in the past, so to protect confidential information, didn’t feel practical in some smaller markets.
“Even in Kamloops, which is about 100,000 people, it’s still a small town,” says Kirsten Mason, an agent at Century 21 Desert Hills. “You know people are getting a divorce before they are getting a divorce. You are always meeting people and hearing personal information that might essentially compromise your ability to work on their behalf.”
Exemptions were introduced to take into account that some markets have very few agents, but they “are a unicorn,” says Mason, in that they can’t really exist. “Nobody has seen one. There are three ways to be exempt: You are rural, or in an under-serviced market, or it would be impossible to have another agent help you. But you could always hire an agent from another place to help you. But, if you did that, would you be (in compliance or) doing the right thing?”
The Office of the Superintendent of Real Estate was not available for questions on Wednesday.