In Part 1 of this post we discussed what the agency relationship is between a Realtor and his/her clients and how that relationship is formed. Now lets look at how this relationship is beneficial to the client – whether buyer or seller – based on the fundamental duties that the Realtor owes to his or her client.
The client has his or her agent’s primary allegiance which includes the following 6 duties:
1. Disclosure – the agent must disclose any relevant information that has come to his or her attention about the property in question including all facts that could affect the desirability of the property now or in the future.
An example of disclosure by an agent would be to make his buyer clients aware that the property they are interested in buying is located on a street that recently was rezoned to allow for high-rises to be built. Although there are no current builders planning to erect a tall condo building, the fact that the possibility exists must be disclosed to the buyers.
2. Competence – the agent has a duty to use superior skills and knowledge in pursuing the client’s interests above that which would be expected from the average person. The Realtor, when dealing in real estate transactions, is considered an expert in his profession and therefore he or she should act accordingly.
A professional Realtor will analyze the local real estate market to help clients better market their property.
An example of competence would be advising a seller client regarding the current market value of their property. The Realtor will have extensive knowledge of the selling price of similar properties in the neighbourhood and will use this insight to guide the sellers on the appropriate listing price.
3. Obedience – as long as his/her client’s instructions are within the law, the agent is obligated to follow these instructions even if he/she does not agree with them.
An example of obedience would be submitting a “low-ball” offer on a property upon the request of the client even though the Realtor believes it would alienate the sellers.
4. Accounting – the agent must keep accurate records and account for all funds and other property that have been entrusted to him/her by the client.
An example of accounting would be a Realtor safeguarding any documents provided by the sellers which relate to the property being listed. Any photos, receipts, warranties, etc must be kept safe and returned to the clients upon request.
5. Confidentiality – the agent cannot disclose any information that has come to his/her attention which could harm or disadvantage his/her client.
An example of confidentiality would be knowing that the seller couple is very motivated to sell their home because they are going through a divorce. *Note: this duty should not be confused with the professional responsibility of a Realtor to disclose all material facts about the property to non-clients. This is an obligation that must be followed in order for all persons to be treated fairly and honestly.*
6. Loyalty – the most important of all duties and places the interests of the client above all else except the law. A Realtor must act in the best interests of his/her client at all times to ensure the most favourable outcome in all situations.
Whether buying or selling real estate, having a professional Realtor working on your behalf can have tremendous advantages. Look for an agent that you feel understands your needs and don’t be afraid to ask lots of questions. You should feel comfortable discussing agency and how it will benefit you as a client with your Realtor.
If you are looking to buy a home, or are thinking of selling yours, I would be glad to represent you and help you negotiate the best deal. Please contact me at steve@stevewalsh.ca.
Image courtesy of Naypong / FreeDigitalPhotos.net
