I recently learned that the salesperson for a property I’d like to buy is the seller’s sister. Is this allowed?

The short answer is, yes. It is not uncommon for a buyer or seller to hire someone they know or even one of their relatives to represent them in a transaction. With over 80,000 professionals registered to trade real estate throughout Ontario, it’s of little surprise when we see a buyer or seller lean into a relative to represent their interests. It is permitted, provided they follow the rules under the Real Estate Business Brokers Act, 2002 (REBBA), the legislation that regulates the real estate brokerage industry.

When a real estate professional, or a person related to him or her, has an interest such as an ownership stake or other financial interest in the property, he or she is required to disclose the relationship in writing to all other parties to the transaction before an offer is made. REBBA defines what relatives need to be disclosed but salespeople generally disclose beyond those when there is any type of family connection.

In addition to disclosing and documenting their relationship, the broker or salesperson must follow all the same rules of professional conduct as they would when representing a non-relative.

For readers considering hiring a trusted family member or friend to help buy or sell a home, it may be a good approach, but it’s important to establish and set expectations ahead of time. I suggest buyers and sellers work through the same vetting process when considering hiring a friend or relative as they would if they were considering hiring a non-relative. As always, you want to be sure that your salesperson is experienced in buying or selling the type of property at hand, knowledgeable about the area in which you’re buying or selling and will employ marketing tactics that will meet your expectations. By ensuring that everyone is on the same page, you’re much more likely to have a positive experience.

It is also important to understand that regardless of any pre-existing relationship or relation you may have with your salesperson, the salesperson must still follow the rules set by the Ontario government to protect consumers. One of the most important provisions requires brokers and salespeople to provide conscientious and competent service to the buyers and sellers they represent. In addition, they have to treat everyone they deal with in the course of a real estate transaction fairly, honestly and with integrity.

Visit reco.on.ca for a full list of things to keep in mind when considering hiring a friend or relative to represent you in a transaction.

If you have a question for Joe about the home buying or selling process, please email information@reco.on.ca.


Joseph Richer is Registrar of the Real Estate Council of Ontario (RECO). He is in charge of the administration and enforcement of all rules that govern real estate professionals in Ontario. You can find more tips at reco.on.ca, follow on Twitter @RECOhelps or on YouTube at http://www.youtube.com/RECOhelps.

 

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