Posted on
September 29, 2023
by
Edmonton Homes
Conflicts of Interest
In rare situations, you may run into a conflict of interest. It arises when there is a real or apparent incompatibility between a real estate agent interests and your interests. Examples of common conflicts that can arise in a real estate transaction:
Conflict #1: REALTOR® is related to seller
if you find a home to buy and the seller is related to your real estate licensee. This is a conflict of interest because your real estate licensee is supposed to put your needs above all else and if they’re related to the seller, it could be difficult for them to do so. This is a conflict of interest because your real estate licensee is supposed to represent your best interests, and they won’t be able to fulfill that fiduciary duty if it’s their property you want to buy. REALTORS® have an obligation to avoid, and disclose any conflicts of interest to you as soon as they arise.
What are your options
Choose to write the offer with a different real estate agent who is not affiliated with the property. Even if a real estate agent has not shown you the property, you can still write an offer with a diffent agent.
Conflict #2: REALTOR® is the listing agent
if you find a home where the listing agent is representing both you and the seller. This can be a conflict of interest because your real estate licensee is supposed to put your needs above all else. When this happens, your REALTOR® is obligated to explain your options which include changing your "professional working relationship" to a customer status from a client status. However, doing this is not in your best interest because under a "customer status", only facts need to be disclosed. Under a "client status", everything known MUST be disclosed which includes everything known about the property and the sellers reasons for selling.
What are your options
Even if a real estate agent has not shown you the property, you can still write an offer with a diffent agent. Once you are aware of any conflict of interest, it’s up to you how you want to proceed. You may want to get legal advice or you may want to proceed with a different real estate licensee.
Conflict #2: Buying a New Build
Most sales representitives sitting at show homes are NOT REALTORS®. Therefore, the sales representivities are not held to the same liability standards as licensed REALTORS®. Show home representitives are working in the best interest of the builder.
What are your options
Choose to write the offer with a licenced REALTOR®. A large percentage of new builds are sold by REALTORS® even if they are not on the MLS system. A licenced REALTORS® who is familiar with the differences between the builders can be a valuable asset and save you thousands of dollars, point out known defeciencies and work in your best interest - not the builders!
Your real estate professional cannot provide services to you if they are in a conflict of interest unless you give them your written informed consent.
