The recent announcement by the British Columbia’s Office of the Superintendent of Real Estate that it intends to ban the practice of dual representation in real estate transactions has sparked debate among realtors, including here in Kelowna.
Many in the industry, including the president of the Okanagan Mainline Real Estate Board, have spoken out against the proposed change.
But Mark Walker, a real estate agent in Kelowna, says he supports change.
And that position, he says, brought him into conflict with the president of his own real estate committee.
“I’ve been in two-agency situations and think the proposed new rules to be implemented will benefit both consumers and brokers,” said Walker.
A dual agency is when the same broker represents both the buyer and the seller in a single transaction.
“The dual agency can jeopardize the broker’s ability to do the best job for his client,” he said. “Think about it – how can you really represent both the buyer and the seller in a transaction? How can you negotiate for them? You can not. It’s a total conflict of interest and a recipe for trouble. “
Walker, who runs his own real estate brokerage firm Walker Real Estate, compares the existing rule that allows dual representation to a lawyer who represents both defense and prosecutors.
“I am sure that the individual attorney has the ability to make very good arguments on both sides, but could you say that this kind of listing would be in the best interests of the client?”
He said his company took steps last year to limit its involvement in dual representation.
According to Walker, the main reason so many brokers oppose it is money.
“Admit it or not, I believe most of the resistance comes from the potential loss of income,” Walker said.
“Some agents will argue that it is up to the customer to decide how they want to be represented, and if they allow dual representation then so be it. However, this is a misleading point. If clients really understood how dual agencies work, they wouldn’t go for it. I have no doubt about that. “
While Walker emphasized that there were many very good real estate agents and brokers in town, he said an agent has a fiduciary duty to his clients and the dual agency undermines that duty.
“Ultimately, it is utterly impossible to represent both sides of a single transaction in the best interest,” said Walker.
“The best you can do is become more of a mediator than a negotiator, but you should be paid accordingly – in other words, less. It’s like hiring a mediator rather than a litigator. These proposed new changes are good for industry and consumers. I have no doubt about that. “
The office of the Superintendent of Real Estate and the Real Estate Council of BC governs the real estate industry in BC. The new regulation on dual representation is due to come into force on January 15th.
Kelowna Capital News
