“The trademarks MLS®, Multiple Listing Service® and the associated logos are owned by The Canadian Real Estate Association (CREA) and identify the quality of services provided by real estate professionals who are members of CREA. Used under license”
Since it is not practical to insert these statements throughout the book because of their frequent usage, the above statements are implied.
Because REALTORS® are members of the Canadian Real Estate Association, this allows us to have access to the Multiple Listing Service®, or MLS®, the most complete and powerful listing service available. The MLS® Systems are financially supported by their memberships.
It does not follow that all real estate agents are REALTORS®. If they do not belong to a real estate board that is a member of CREA, they are simply real estate agents and not REALTORS®. As such, they do not have access to the MLS® Services.
REALTOR® - Definition
Throughout Canada, there are almost 100,000 REALTORS®/brokerages working within over 100 real estate boards and associations.
REALTORS® subscribe to CREA’s Standards of Business Practice and The Code of Ethics. As such, you, the consumer, have the right to expect the highest professional standard of conduct and the best of service. It also requires that you are competently represented and that our dealings display the highest level of integrity and fairness.
This includes continued mandatory education to ensure competence and effectiveness.
The Code doesn’t gather dust in some archive but is alive and well! Any complaints from the consumer are taken very seriously and are immediately addressed by the respective local real estate boards. Depending on the severity and complexity of the complaint, it may be elevated to a higher level of authority.
Guidelines to Consider
I and my co-authors are based in Victoria, British Columbia, Canada. As such, we are governed and must follow the specific guidelines of our respective provincial/federal associations.
Even though some of the contents of this book, such as terminology and forms used, are specific to a jurisdiction, there are ample general concepts discussed that can be most helpful across jurisdictions.
The intent of this book is not to provide you with all the answers with respect to buying and selling real estate. It is to provide you with an understanding of the general principles involved in the real estate process. In turn, this will enable you to proceed with greater confidence and empower you to ask the appropriate questions of professionals in your particular province or jurisdiction.
Is This Real Estate Book Necessary?
That’s a fair question. And the answer is a resounding –YES – !
As REALTORS®, we are always engaged in explaining some aspect of the real estate process to consumers who are thinking of buying or selling. This can take place in our office when they are ready to buy or sell or simply in a social setting because they know that’s what we do.
There is nothing in the market place that addresses the real estate process itself. There are pieces of information everywhere. Almost every REALTOR® and financial institution can provide you with some information. There are even books addressing various elements of buying and selling homes but from the investment point of view and not the real estate process itself.
It is an overwhelming task for the consumer who wishes to buy or sell a home to collect this information and try to find some logical order that would actually provide some direction. If I’m a first time home buyer or if it has been years since I purchased, where do I begin. Do I go to my bank? Do I go to a REALTOR®? What do mortgage brokers do? How much can I afford? How will I know I have made a good buy?
If I want to sell my home, should I sell it myself? What is my home worth? Should I speak to a REALTOR®? Will I need a lawyer? How do I prepare my home for sale?
The purpose of this book is to connect the dots between all the elements of the real estate process and to have greater knowledge of each step. You will have the benefit of experienced professionals involved in the major steps of the process to provide you with their insights and how they can be of help along the way.
As you read through this book, you will find out more about each profession, the professionals and what they are actually doing to contribute to the process of your real estate purchase or sale. What should you be aware of and what questions should you be asking along the way. There are implications to each step of the process and many of these areas will be addressed.
Understanding all the elements of the real estate process and how they connect will empower you, the consumer, to make informed selections and decisions. This is critical because, whether you are buying or selling, you are making one of the largest financial decisions of your lifetime.
Required Documentation When Buying or Selling
Aside from the actual real estate contracts, there are many other forms that are utilized during the real estate process. However, the two discussed below are to be used without exception in both the buying and selling process throughout Canada. I’ve opted to do the explanations up front and just reference them later as they come up.
Agency Relationship - “Working with a REALTOR®”
Up until the mid-90’s, a REALTOR® who worked with a buyer was actually a sub-agent of the seller. This meant that the buyer did not have representation. In practical terms, whatever the buyer disclosed to the REALTOR® was to be shared with the seller.
The real estate business has changed significantly since then. Before the consumer begins working with a REALTOR®, he should be aware of the kind of agency relationship he is entering. These are legal relationships with inherent duties. Establishing agency relationships is practiced throughout Canada.
When you and I first meet at my office, I generally ask you the kind of real estate experience you have had and if you are familiar with ‘agency relationship’. At best, consumers are only vaguely familiar with the term. There are important legal implications so I like to give it a higher profile in my discussions. There is a small brochure entitled ‘Working with a REALTOR®’ which describes these relationships. I will give you an abbreviated and concise version of its contents.
What is Agency?
The agency relationship is between the principal (you) and the Brokerage (the real estate company). The REALTOR® who represents you is licensed under the Brokerage. The practical application is that I, as a licensed REALTOR® working under my Brokerage, have the authority to represent you in the real estate transaction when dealing with others.
When representing you, my fiduciary duties to you, under the Brokerage, are to look after your interests as if they were my own. This means: -
I have to disclose everything I know about the property and situation that may affect or influence your decision regarding the real estate transaction.
My duty includes protecting your negotiating position by not disclosing anything that would jeopardize it. I owe you undivided loyalty.
I must obey all your instructions as long as they are lawful.
I am not at liberty to disclose any of your confidences and must keep them confidential.