Buyer Brokerage Mandatory July.01,2014
Effective July 1, 2014,
The Real Estate Council of Alberta (RECA) requires Realtors who establish a client relationship when trading in residential real estate to enter into a written service agreement with their client. Written service agreements help ensure the role of an industry professional is clear, and when clients are better informed, there is less confusion and typically, fewer disputes.
Written service agreements help Realtors clearly and confidently communicate with clients about:
• the relationship between the parties
• the services to be provided by the brokerage
• the obligations and responsibilities of the parties
• consent for collection, use and distribution of personal information of the client
• method of calculation of remuneration or how the industry professional will be compensated
Frequently Asked Questions
Are written Buyer Representation Agreements mandatory?
Yes. Effective July 1, 2014, if you are interested in buying residential property and are the client of a real estate professional in Alberta, you will be asked to sign a written service agreement (buyer representation agreement).
What is the difference between an exclusive and a non-exclusive buyer representation agreement?
In an exclusive buyer representation agreement, you, as the buyer, agree to only use the services of that brokerage to represent and assist you in purchasing a property.
In a non-exclusive buyer representation agreement, you, as the buyer, may use the services of multiple brokerages at the same time. You can enter into multiple non-exclusive buyer representation agreements.
Does my buyer representation agreement have to be exclusive?
No. However, your agreement will need the consent of the brokerage(s) you’re working with. Consumers should make an informed choice about the type of relationship they wish to have with a real estate professional. They should also understand the implications of the options available to them.
Exclusive Buyer Representation Agreement
- Has a start date and an end date and a set fee
- Brokerage is responsible for paying to the buyer any portion of the fee paid by the sellers or their brokerage, which is in excess of the agreed fee to the buyer. Buyer is responsible for any portion of the agreed fee which is not paid for the by the seller, to the brokerage.
- Buyer may negotiate any shortfall of the fee offered by the seller, as a term on their Offer to Purchase, or reduce the amount of their offer.
- If you change your mind about looking for a property, the brokerage may require that they be reimbursed for reasonable expenses incurred or accessed by your agent.
- A retainer may be required. If a purchase is made, the retainer is applied against the purchase
- Buyer may be responsible for reasonable costs if they do not complete a purchase
- Agent advocates on your behalf, can use judgment, give opinions and advice advice which require discretion, and is required to act in your best interests at all times
In addition your Agent must
- provide property listings for all properties matching your criteria that they have knowledge of
- show you properties
- Provide you with options and advice when requested, and exercise judgement
- Provide you with historical information to enable you to make an informed decision
- provide agreements of purchase and sale and other relevant forms, and help you complete them.
- Give you the names of real estate service providers and make recommendations if requested
- Answer any questions you may have
- present all offers and counter-offers to and from you
- pass on information that you want them to.
- keep you informed of progress
- perform due diligence with respect to any property you are pre