Client - Real Estate Brokerage

Purpose: This bulletin explains who a client is and clarifies when you must disclose the nature of your services, relationships and conflicts.

This bulletin applies to real estate brokerages, brokers, associate brokers and associates.

Industry professionals are responsible to ensure their role is clear and understood and must not pressure or direct potential clients to a particular type of relationship.

Real estate professionals must clearly understand their obligations to a client or customer. Consumers should make an informed choice about the type of relationship and understand the implications of the choices available.

Customer relationship
The Real Estate Act Rules (Rules) define a customer as:
“a person who has contacted, but not engaged or employed, an industry member to provide services”

A person starts out as a customer before they become a client. The person may decide they would like to engage the real estate professional to assist them with their real estate needs. Assuming the real estate professional agrees to assist this person with their real estate needs, the relationship changes and the customer becomes a client.

Client relationship
The Rules define a client as:
“a person who has entered into a service agreement with an industry member, whether or not that service agreement is in writing”

A client can be a seller, buyer, landlord, or tenant who engages a real estate professional to assist them with their real estate needs. The real estate professional must represent the client’s best interests at all times and assist them with the real estate transaction.

When to enter into a client relationship
Some customers will clearly communicate their desire to have the real estate professional represent them in a trade in real estate. Other customers will be less clear about their intentions and expectations.

They may make assumptions about their relationship with the real estate professional. Do not ignore this issue. A real estate professional must address this situation with a customer and clarify the nature of the relationship. Each case will be unique and the timing will vary.

Examples of when to clarify the relationship:

You must provide and review the Consumer Relationships Guide with all consumers. If you intend to represent or assist a person in a real estate transaction, you must discuss your potential relationship options with the consumer. Do not assume a consumer understands your role and responsibilities if they do not ask questions. An industry professional must explain their obligations and what services they will provide.

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