If I sign a Buyer Representation Agreement, can my salesperson show me a home where they also represent the seller?

The short answer to your question is that it is possible for your salesperson to show you a home where their brokerage represents the seller, but they need to inform you of this fact as soon as possible, and you will have other decisions to make before you submit an offer.

If this happens, it’s best to exercise caution and consider your options. The brokerage will tell you that it proposes to represent both parties, and explain the difference between its obligations to clients and customers when working with a buyer and seller separately, and the implications of representing two opposing sides in the same deal. In order for the brokerage to represent both parties, you and the seller must confirm your agreement in writing.

The advantage of signing a Buyer Representation Agreement (BRA) is that it makes you a client of the brokerage: your expectations are laid out in writing, and your salesperson must look after your best interests. They have a fiduciary duty, which means they must follow your instructions, protect your confidential information and promote your best interests.

If you sign a Customer Service Agreement (CSA) to become a customer, and not a client of the brokerage, you will receive a much more limited level of service. Your salesperson may help you fill out the forms, and they’re expected to treat you with honesty and integrity, but they don’t have to look out for your best interests. Any information you give the seller’s representative about your personal circumstances and motivation can be disclosed to the seller. I don’t recommend the customer option unless you understand the terms of the agreement and are absolutely comfortable with those limitations.

When you’re a client, your salesperson has a responsibility to act as your champion, but what happens if the seller is also their client? Who gets the best outcome when the buyer client wants to pay as little as possible, while the seller wants to receive the best possible price for their home?

If you think that sounds like a potential conflict of interest, you’re right. The Real Estate Council of Ontario (RECO) has requested the provincial government clarify, and tighten the rules relating to multiple representation, which is when a single brokerage represents more than one client (usually the buyer and the seller) in a transaction. Last year, the government announced that rule changes are coming, but for now, it’s important to make informed decisions. Your brokerage will provide the necessary information, but you must decide what’s best for you.

If you have a question for Joe about the home buying or selling process, please email askjoe@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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