Real Advice E-News Issue 6 (January 19, 2018)

Real Advice is a weekly e-newsletter helping licensees prepare for regulatory changes.

January 19, 2018

Commercial, Rental or Niche Market Providers

Since the Superintendent of Real Estate’s announcement of new consumer protection rules that come into effect March 15, 2018, we’ve heard from people who wonder how the rules will apply to commercial properties, niche markets, and rental property management.

BC’s new rules for real estate licensees strengthen consumer protection by introducing four new mandatory disclosure forms that licensees must use:

1. a new mandatory form to inform consumers of the duties and responsibilities a licensee owes to clients and unrepresented parties.
2. a new mandatory form to disclose to consumers the risks of being an unrepresented party in a real estate transaction.
3. a new mandatory form for consumers explaining the risks of dual agency, to be used when a licensee is relying on the extremely narrow exemption to the ban on dual agency.
4. a new mandatory form disclosing to a seller, each time an offer is presented, the amount to be paid by the seller to the listing brokerage.

RECBC will make these new forms available ahead of March 15, 2018, along with resources to help licensees and consumers understand how and when they should be used.

Rules Apply to Commercial Transactions

With the introduction of these rules, the Superintendent signaled that all real estate consumers have a right to expect the undivided loyalty of their licensee, and must be fully informed of their rights and the risks. The Real Estate Services Act and the new rules do not distinguish between residential and commercial real estate transactions.

Beginning March 15, 2018, licensees who specialize in commercial real estate must use all four new mandatory disclosure forms with consumers.

Some Rental Property Management Activities Affected

The new rules apply to trading services in relation to the rental of real estate. This means that services such as finding tenants and assisting in the renting or leasing of property are covered under the rules, while collecting rents or managing the real estate are not.

When providing these trading services, rental property manager must use the first three mandatory disclosure forms listed above. Because property is not being sold, rental property managers do not have to make a disclosure of expected remuneration to sellers.

Serving Niche Markets

Regardless of whether you specialize in ranch lands, mobile homes, supermarkets or other kinds of specialty properties or niche markets, the new rules will apply to the services you provide. You must begin using all four new mandatory forms on March 15, 2018.

Strata Management Services

The new consumer protection rules do not apply to the provision of strata management services.

Answers to Your Questions

Visit RECBC’s website for information and advice about how to comply with the new rules in many common scenarios.

Do you have a question that isn’t covered in our online FAQ? Send it to us using our online form. In future issues of the Real Advice enewsletter we’ll post answers to the top questions we receive.

Published on Jan 19, 2018