A blog cannot deal with all aspects of a subject and is not intended to replace professional advice. It's purpose is to highlight information and identify areas of possible interest. Anyone wishing to discuss this blog or to make any comments or suggestions about this blog is invited to do so by either posting comments or emailing me directly.


Defining Real Estate Agent Relationships with Consumers

Thinking or buying or selling a home in the Calgary area? Whether this is your first time or your tenth, I am here to help. But until we have an actual agreement in writing that defines our relationship, I can't help you with a specific real estate transaction.


I completely understand the relationship between home buyers or home sellers and their real estate agents has to be based on trust, mutual goals and understanding – that's why I always keep my clients' interests first and foremost. The real estate process requires negotiation of sometimes very complex issues: once we mutually commit to working with each other, I am always committed to working in my clients' best interests.

As a licensed real estate professional helping buyer clients, I'm obligated to help you secure the very best price possible, with the most favourable terms for you, in the timing that you define. In helping seller clients, I'm obilgated to market your home to the best of my abilities and in line with your direction. My goal is to help you secure the best possible price, with the most favourable terms, also, in timing that you define. If I agree to take on your listing, I will market it at the price you say.

In Alberta, a broker of real estate (also known as a real estate agent) and their client must enter into a written agreement prior to exchanging confidential information and prior to an agent providing the consumer with any kind of advice. This is typically called an Agency agreement. An Agency relationship has a lot of benefits for you, the consumer. However, there are also other types of relationships.

Real estate brokers are required by law to discuss the different types of relationships available. I try to discuss the various relationships at the very first opportunity so that you have a chance to clearly know your options. Depending on the one you chose, legal obligations for both parties will vary. 

  • Common Law Agency – is a legal relationship established when two parties agree to have one party represent the other party or provide services on behalf of that party. This common law agency relationship exists between the client and the real estate brokerage (the real estate firm that the agent works for).
  • Designated Agency (a modification to common law agency) – is when the agency relationship exists between you as the client and a designated real estate industry member from a particular brokerage - not with the brokerage itself. The industry member you choose is your designated agent from that brokerage.
  • Customer Status – is when a consumer hasn't yet established or decides they don’t want an agency relationship with a real estate industry member, but still wants to work with them on a particular real estate transaction. The industry member has an obligation to act honestly and with reasonable care and skill, but wouldn’t owe you any fiduciary duties nor can they provide any advise to you. You are not a client, but rather are a customer. This is the default relationship should you call a real estate agent to see a home or meet them at an open house. Until you have a written agreement to the contrary, you have customer status with the real estate industry member (they are required to ask for a written acknowledgement of this status at some point prior to starting a specific transaction, and that is your key indication that they are not representing your interests and that they are only faciliating the trade in real estate with you. If they are concurrently working for the other party, then they are obviously working against you and your interests.)
  • Transaction Brokerage – allows a real estate industry member to work with both the seller and buyer in the same transaction in client relationships, while treating both clients in an even-handed, objective and impartial manner. They cannot provide any advice to one party without getting prior permission from the other party. Their primary job is to reach an agreement  for the benefit of both parties. For the agent, it is quite a challenging situation to be in and frought with legal landmines. In Calgary, this is usually quite a rare occurence for normal residential real estate transactions.

Real estate brokers must also provide you a copy of the completed relationship agreement whether it is an Agency or a Customer Status agreement. Most agents will provide you a copy of the agreement well before asking you to commit to it in writing. The agreement itself doesn't obiligate the consumer financially, until it is coupled with a Representation Agreement. Representation Agreements don't require payment until the specific terms of the agreements have been fullfilled.

If you have any questions about Agency and my obligations and roles to be your Professional Real Estate Broker, please don't hesitate to ask me.


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