New B.C. Realtor regulations have many in rural areas of the province concerned.
The new rules are intended to protect consumers in B.C.’s real estate market, and prevent real estate agents from representing a buyer and a seller at the same time — otherwise known as “dual agency.”
New B.C. Realtor rules will disproportionately affect rural Realtors, said Liberal Cariboo Chilcotin MLA Donna Barnett.
Barnett said that the rules essentially take away the rights of consumers to chose who they want to buy and sell their house.
The new rules, put in place by the Office of the Superintendent of Real Estate, are intended to address the practice of “shadow flipping,” where realtors exploit consumer interests for their own profit.
Barnett, a formal Realtor herself, said there has always been a high amount of disclosure and ethics when it comes to Realtors, and that a few who don’t obey the rules shouldn’t make it harder for everyone else.
David Jurek, the co-owner of RE/MAX in Williams Lake and 100 Mile House, and also a director on the BC Northern Real Estate Board said that while real estate agencies will adapt to the new rules, the biggest impact will likely be on the consumer.
“In big cities this will work not terribly horribly, because they won’t find themselves in a conflict like we may on a daily basis. Some of our clients may be told that we can’t represent them, or that they will have to use another Realtor that they don’t necessarily know.”
The regulations also require Realtors to disclose any information or prior relationship they may have had with a buyer or a seller that may represent a conflict of interest and may require they refer the transaction on to someone else — someone whom the buyer or seller may not know. In a small town, where the choices of Realtors are fewer, the conflicts can come into play more frequently, possibly resulting in bouncing clients around.
“We have a small number of Realtors dealing with a high number of clients, and that’s where the conflicts come into play because you learn about these people,” said Jurek, adding that the market may not have the space to make room for more Realtors, particularly in slow winter months.
Barnett said that the rules as they stand could have affected as much as 75 per cent of her former business. She worries that consumers will end up choosing not to go with a Realtor, and thus have less protections. In agencies where Realtors are family members, she’s concerned real estate offices may end up closing.
She said she’s fought the issue in the B.C. Legislature, at least asking for a delay in the implementation of it, so that the “unintended consequences” can be better understood.
The new rules are complex and somewhat confusing, said Jurek, and while he said his Realtors have the tools to work with the new rules, he hopes consumers will speak out about the effect they have on them.
“The way of doing business is totally different. Even for the industry it is going to be a learning curve,” he said.
“As a group of individuals we will adapt. I just believe strongly the consumer is going to be the one sitting at the table saying how does this all make sense?”
Still, he said they’ll make do.
“It’s going to be a pain. People are still going to buy and people are still going to sell, we just have to mix those people in the office. The sellers and the buyers are going to be bounced between people and won’t understand why.”
He hopes that as the new rules come into effect, regulators will see they don’t necessarily work in all markets and will make allowances for rural markets.
“The intention is that they are looking out for the client, but if you and I sat down to do a deal today, you would find that you are the one being penalized and not me.”