Nova Scotia has become the second province in Canada to make Buyer Brokerage Agreements mandatory.
While brokerage agreements have been standard practice for sellers, the rule change by the Nova Scotia Real Estate Commission (NSREC) means those looking to purchase a home as a client of a brokerage will also sign a brokerage agreement. “It acts as a source of reference especially for clients in knowing their rights and responsibilities,” says Sarah Hill, communications officer at NSREC. From a consumer perspective it helps a buyer client understand what the brokerage obligations will be and how the brokerage will be paid.
“From a licensee’s perspective, mandating Buyer Brokerage Agreements gives brokers the ability to more easily maintain stock of their buyer clients and ensure compliance of the terms of their relationship with the brokerage,” says NSREC. “From a regulatory perspective, it is just as important to have all client relationships clearly expressed in writing for buyers as for sellers.”
While the agreements have already been mandatory for buyers working with some types of brokerages since 2008, Nova Scotia is the second province in Canada to mandate brokerage agreements for all buyers who are clients of real estate brokerages – second to Alberta.
NSREC says the purpose of buyer brokerage agreements are to:
- describe the role and services of the brokerage and, if applicable, the designated agent
- outline the obligations of the client, the brokerage and, if applicable, the designated agent
- explain the extent to which personal information can be shared
- establish a clear commencement and expiry dates for the relationship
- address conflicts of interest.
The newly revised agreement has been rewritten to a degree, in plainer language.
The NSREC offered information sessions for licensees prior to making the agreements mandatory.
For more information, visit the Nova Scotia Real Estate Commission’s website to view the new Buyer Brokerage Agreement, a list of do’s and don’ts and the top 10 questions for consumers.
Penn Javdan is a contributing writer for REM.
