Alberta Real Estate
Many aspects of real estate transactions like meetings, property viewings, and open houses require interacting with numerous people. As we are facing a global health issue, knowing your risks and options is essential.
Real estate related services have been deemed essential by the Government of Alberta, so there is a chance that your real estate professional will still be hard at work.
Visit the COVID-19 page on the Government of Alberta website for daily updates and the most current information to help you assess your personal risk. Then, discuss your concerns with your real estate professionals, so you can work cooperatively on any precautions or adjustments needed to keep yourself and others healthy.
With physical distancing, it is important to minimize visits to your home in order to minimize the risk of infection for you and others. Options for you and your real estate professional to consider:
- using video to create a virtual viewing opportunity in lieu of having an open house, or to limit viewings to serious buyers
- screening potential buyers before scheduling viewings—ask about their health and recent status to determine the risk they pose to you
- placing conditions on viewings, such as the need wear masks and gloves.
- creating a plan for disinfecting your home after each viewing
If the risk to you and your family is significant, you may consider suspending or ending your listing agreement, or postponing it to a time when there is less health risk. If you choose to pull your property from the market, make sure all amendments, including agreements to relist at a later date, are put in writing.
Remember real estate transactions involve interacting with multiple regulated professionals. It is important to discuss any concerns, options, and preventative safety measures with every professional.
Make sure any waivers or contract clauses related to COVID-19 are reviewed by your real estate lawyer before agreeing to them and signing off.
RECA’s COVID-19 consumer portal—COVID-19 for Real Estate Consumers—provides detailed information, including information for real estate buyers. This information will continue to be updated as the COVID-19 situation in Alberta evolves.
The following is a case study on response to a confirmed case of COVID-19 in a commercial building. It is based on an actual event from March 2020, as described by Jon Douglas, Menkes Property Management during a video discussion with BOMA Canada. RECA encourages commercial property managers to review the details and use the information as guidance for creating their own COVID-19 case response protocol.
Before the confirmed case
In January/February, Menkes:
- implemented additional cleaning for high-touch points
- placed hand-sanitizer dispensers in lobbies and common spaces
- launched hand washing campaign using posters and social media posts and elevator screens
- issued a tenant notice outlining these measures and shared information made available by Toronto Public Health
Mar 5th: more planning
Property leaders came together for an emergency call to discuss COVID-19 and actions that needed to be taken. They:
- planned communications in the event of a confirmed case
- templates/drafts were created for 10 communications
- created an internal response protocol
- contacted external providers for disinfecting spaces
- staff were asked to log all floors they were present on
March 17th: confirmed case of COVID-19 was reported
At 8:35pm a tenant notified Menkes that there was a confirmed case of COVID-19 within their employee pool and that the individual had been at work. The response protocol was implemented:
- the menkes General manager was notified and immediately implemented the COVID-19 protocol
- Public Health was already aware of the case and did not need to be contacted by Menkes
- a housekeeping specialty team was mobilized to disinfect common spaces, floors, elevator cabs, and parking elevators (in addition to the day-to-day cleaning that was occurring)
- the general manager participated in a conference call with the tenant (employer with confirmed case) to review the Menkes protocols and learn steps the tenant was taking
- the tenant confirmed all employees were working from home until further instructed
- Menkes leadership:
- connected via conference call to bring everyone up to speed
- sent out notice to all staff on site: security, parking
- sent out a building-wide tenant notice regarding the confirmed case and notifying tenants that Menkes was implementing their draft protocol
- drafted a script for responding to tenant calls. The script indicated they could not confirm information about the tenant or the employee affected. They could only communicate when that employee was last in the building
March 18 @ 3am: response protocol was running
The disinfecting of all floors was completed and a notice of this was sent to all tenants. Menkes:
- connected with Toronto Public Health to review Menkes procedures, protocols and information
- sent out tenant communications confirming
- contractors would continue disinfecting high-touch points
- there was low risk to other tenants in the building
- they were following Public Health direction
- they could not release any information about the tenant or individual with the confirmed case
- to reduce risk to operations staff, they would not be responding to non-urgent work orders while occupants were in the building—things like changing lights would happen over night (operations staff adjusted schedules)
March 18th 11am: media inquiries
Menkes released a statement with what information they could share. One Toronto media outlet released false information stating the building had been sealed and quarantined, which started an all-out panic where building tenants, other media outlets and tenants/managers of neighbouring buildings began calling for information. Menkes:
- staff were instructed to take down information of the caller but not answer any questions
- released a tenant notice about the media situation and the false information
- released corrected information, forcing the media outlet was forced to post a correction
- confirmed with tenants that the building was open and safe
- sent notice to contractors and vendors confirming the building was safe for people to come into for work
March 19: response review and follow up
- management had a conference call to review protocol and discuss lessons learned, and update protocol for future cases based on experience
- staff reached out to tenants to discuss protocols for when happens to them (because it’s more a case of when, not if)
I’m selling my home, and the potential buyers also want to use my real estate professional to represent them. Is that allowed?
Yes, that’s allowed. The situation you’re referring to is called transaction brokerage. Transaction brokerage is a service option when your real estate professional represents a buyer client interested in purchasing the property in which you are the seller client. The reverse is also true – transaction brokerage is a service option when you’re interested in buying a property and the property’s seller is also represented by your real estate professional.
When a real estate professional works on behalf of only one client in a transaction – the buyer or the seller – they have legal responsibilities, which include:
- undivided loyalty to their client
- acting in their client’s best interest at all times
- the duty to avoid conflicts of interest
- the duty to disclose conflicts of interest when they arrive.
Transaction brokerage changes the services your real estate professional is able to provide to you and to the other party in the transaction. A real estate professional who is working with both the buyer and the seller in a transaction cannot fulfill all of their legal responsibilities because there is a conflict between the best interests of the buyer and those of the seller. The buyer wants to pay as little as possible for the property, while the seller wants to sell their property for the highest possible price. It is impossible for a real estate professional to advocate for and represent the best interests of a buyer client AND seller client in the same transaction.
This is when and why transaction brokerage becomes an option. In transaction brokerage, the real estate professional will provide facilitation services to you and the other party. These services include:
- helping the buyer and seller negotiate an agreement
- giving the buyer and seller property statistics and information, including comparative information from listing services and local databases
- providing and preparing agreements of purchase and sale, and other relevant documents according to the buyer and seller’s instructions
A transaction facilitator has to treat both parties in an even-handed, objective, and impartial manner. They must remain neutral, not advocate for either you or the buyer, and they cannot provide confidential advice.
Before a real estate professional proceeds with transaction brokerage, both the buyer and the seller need to provide their informed consent by signing an Agreement to Represent both Buyer and Seller. Informed consent means each client understands the facts, implications, and future consequences of providing their consent. You do not have to consent to transaction brokerage. If you don’t consent to it, or the other party doesn’t, there are other options available to you such as seeking representation from a different real estate professional.
I just spent $50,000 to finish my basement with high-end finishings. Now, I’m listing my house for sale, and my real estate representative says she can’t include the basement square footage in the total size. Why not?
You developed your basement and it’s beautiful. You’re sure any potential buyer would agree that it looks great, and is definitely livable space. But, your real estate professional is correct, the square footage of your basement cannot be included in the size of your home for listing purposes.
In Alberta, real estate professionals are required to follow the Residential Measurement Standard (RMS) when listing a residential property for sale. The RMS contains nine principles that enable real estate professionals, as well as buyers and sellers, to determine and compare the size of residential properties. The RMS sets out the specific parts of a residential property that can be included in its size for listing purposes.
Above grade levels are the levels of a residence that are entirely above grade. Below grade levels are the floor levels of a residence that are partly or fully below grade. If any portion of a level is below grade, the entire level is considered below grade. Below grade spaces include lower levels and basements. The RMS size of a property is, essentially, the sum of its above grade levels. Below grade levels are not included in the RMS area.
Without the RMS in place, there would be little consistency in how real estate professionals, and their sellers, measure and describe their property. Some may want to include their basement (unfinished or not), some may include an enclosed sunroom, while others may include the space created by a bow or bay window.
The RMS provides a consistent means of measuring, and describing, residential property size in Alberta.
Sellers, and their real estate representatives, are welcome to include additional measurement information in their listings, but the primary size listed in the listing must be the size according to the RMS.
Sellers need to remember that size isn’t the only factor that will affect a property’s list or selling price. Other factors include location, condition, quality of finishing, layout, and even type of ownership. You may not be able to include the square footage of your basement in the total square footage of your home, but the features of your home will set it apart from other properties. Size matters, but it’s not the only thing that matters.
I’ve been working with an agent, but she’s going on holidays for 2 weeks. She’s going to arrange for someone else at her brokerage to take care of my listing while she’s gone. Do I have to sign a new contract with this person?
The short answer is no, but you may have to make changes to your existing contract depending on what type of brokerage you’re working with: common law or designated agency.
In a common law brokerage, your service agreement (contract) is with the brokerage, which means that essentially, you’re agreeing to work with any or all licensees at the brokerage. Because the agreement you signed is with the brokerage, any licensee from that brokerage can work with you under your existing agreement. The individual or individuals you have been working with are working with you on behalf of the brokerage.
In a designated agency brokerage, your service agreement is still with the brokerage, but only the individual (or individuals) named on the agreement are designated to work with you on behalf of the brokerage. If this is the case, and the individual your real estate agent wants you to work with for a couple of weeks isn’t specifically named on the agreement, the brokerage will have to designate, in writing, the other individual to work with you. You and the brokerage can amend your original agreement to include this new person as another designated agent for you.
Another option that is available when you’re working with a designated agency brokerage is that at the outset of your agreement, the brokerage designates more than one individual to work with you on behalf of the brokerage. This is completely acceptable, and will save you from having to amend the original agreement in the event the primary individual you’re working with becomes unavailable during the term of your agreement. When you’re signing your agreement, talk to your agent about their availability, vacation plans, and whether there are other agents within the brokerage that they sometimes partner with.
More than fifty percent of real estate professionals in Alberta are registered with a designated agency brokerage. Your agent should have explained whether their brokerage operates under common law or designated agency when you first started working together, and should have explained the differences.
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