The RECO Information Guide

What an agent can do for you

If you are a seller: advise on market conditions and strategy, market your home, arrange showings, advise on competing offers, negotiate, and guide you through the paperwork and closing.

If you are a buyer: help with financing pre-approvals, share information about neighbourhoods and homes, arrange showings, advise on competing offers, negotiate, and guide you through the paperwork and closing.

Duties an agent owes you as a client

• Undivided loyalty: your interests come before those of the brokerage, its agents and any other party.
• Disclosure: they must tell you what they know about the transaction that could affect your decisions.
• Confidentiality: your confidential information, such as your motivation or the most you would pay, cannot be shared without your written consent, except where the law requires it.
• Avoiding conflicts of interest: they must avoid situations that affect their duty to you, and tell you if one arises.

Your responsibilities as a client

Be clear about what you want, share relevant information, respond to your agent promptly, understand your agreement with the brokerage, and pay the fees you agreed to.

If you are involved in a transaction and are not a client of a brokerage, you are a self-represented party. Very few buyers or sellers make this choice, and RECO recommends getting independent professional advice first.

If an agent is working for the other side

• The agent must act in the best interests of their own client, not you.
• Anything you tell them may have to be shared with their client, including your motivation and the price you would accept or offer.
• They cannot give you services, opinions or advice, or discourage you from working with your own agent.
• They must give you RECO's Information and Disclosure to Self-represented Party form and walk you through it first.

You can change your mind

You can choose to become a client of a brokerage at any point during a transaction.

When you become a client, you sign a representation agreement with the brokerage. It may be called a buyer representation agreement or a listing agreement. It must be in writing and given to you as soon as possible. If you do not want to sign one, you should not expect services like being shown homes.

Two kinds of representation

• Brokerage representation: the brokerage and all its agents represent you, and one agent may be your main contact.
• Designated representation: one or more named agents represent you, and the brokerage and its other agents treat you impartially. It also reduces the likelihood of multiple representation.

Ask your agent which type the brokerage offers.

What to look for in your agreement

• Designated representative: the name of your agent, if the agreement is a designated one.
• Scope: the property, area or type of property the agreement covers.
• Services: there is no standard set of services, so make sure what you expect is written in. Do not assume a service is included if it is not.
• Payment: you and the brokerage decide the amount. It is not set by RECO, the government or any real estate board, and it can be a fixed dollar amount, a percentage or a combination.
• Termination: when and how the agreement can end, and any penalties or costs.
• Expiry date: it must appear prominently on the first page, and there is no standard term.
• Holdover clause: it may require you to pay fees if a purchase or sale happens within a set period after the agreement expires.

Sellers and buyers

Sellers should see what they pay their brokerage and any amount they agree to pay to compensate the buyer's brokerage. Buyers should see how their fees change if the seller covers some or all of them, and know that a seller may not offer anything toward those fees.

Multiple representation means a brokerage or agent represents more than one client with competing interests in the same transaction, for example both the buyer and the seller. It is not permitted unless every client involved agrees, and RECO suggests getting independent advice, such as from your lawyer, first.

If you agree

• The brokerage or agent must treat each client objectively and impartially.
• They cannot keep undivided loyalty to you or advise you on things like the price to offer or accept.
• They must give you written disclosure first, including how their duties, your services and your fees change.

You can refuse

If you do not agree, they cannot proceed. Ask about alternatives, such as being referred to another brokerage or agent for that transaction.

Competing offers

Buyers who make an offer are entitled to know the number of competing offers. Sellers decide how much other information, if any, to share, and must give clear written direction before the content of any offers is shared.

Brokerages and agents in Ontario must be registered with RECO and are accountable for their conduct.

Step 1: contact the brokerage

The brokerage can often resolve a concern. A brokerage cannot ask you to sign an agreement that stops you from making a complaint to RECO.

Step 2: contact RECO

You can file a complaint with RECO about a brokerage or an agent. RECO will review it and decide what next steps to take.

Real Estate Council of Ontario
3300 Bloor Street West, Suite 1400, West Tower, Toronto, ON M8X 2X2
Phone: 416-207-4800 · Toll free: 1-800-245-6910
Consumer inquiries: information@reco.on.ca