WORKING WITH A REAL ESTATE BROKER AND AGENT
When working with a realtor, it is important to know who he or she is working for and what their responsibilities are. In general, there are three common relationships that buyers and sellers encounter:
Realtor working for the buyer (also know as the cooperating, selling or buyer's agent): When the realtor has an agency relationship with a buyer, the brokerage and all of its agents represent the buyer. The realtor will be acting in the best interests of the buyer and will attempt to find properties that meet the needs of the buyer. The Buyer Representation/Agency Agreement between the buyer and realtor sets out the terms of the relationship. The buyer's agent is usually paid from the sale proceeds (the buyer does not usually have to pay their agent directly). However, this is not always the case and it is important that buyers and their realtor discuss the issue of commission early and often.
Realtor working for the seller (listing agent): When a realtor has an agency relationship with a seller, the brokerage and all of its agents represent the seller. The realtor will use their resources to find an appropriate buyer and will be acting in the best interests of the seller. The seller’s agent must communicate any important information to the seller, including information about how much a buyer may be willing to offer. Be mindful that when viewing a property, at an open house for example, the realtor who greets potential buyers is typically representing the seller. In these circumstances, potential buyers should be mindful of revealing too much information beyond what they are looking for and what the property in question offers.
Realtor working for both buyer and seller: It is possible that both the buyer and seller be represented by a single realtor in a given transaction. The buyer and seller must both provide informed consent to enter this arrangement. The brokerage must disclose all relevant information to each party in a timely manner and is bound to deal with each honestly and impartially.
The terms "selling agent" and "listing agent" can be misleading because the selling agent actually represents the buyer, while the listing agent represents the seller.
In Ontario, the Code of Ethics, under the Real Estate and Business Brokers Act, 2002, sets out the responsibilities of realtors.
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