Province proposes end to real estate agents representing seller, buyer

Ontario is proposing banning the practice of double ending, in which a real estate agent represents both a buyer and a seller in a transaction.

The province’s Liberal government announced a 16-point housing plan earlier this year, with centrepiece planks of a 15 per cent foreign buyer tax and expanded rent controls.

Another plank was reviewing the rules for real estate agents to ensure consumers are fairly represented. The government has now published several proposals for changes to real estate agent rules and penalties, and is seeking public consultation on them.

One of the proposals is to ban — with some limited exceptions — agents from representing both the buyer and seller or more than one potential buyer in a trade.

“The seller will want the highest possible price and most favourable terms they can get, and the buyer will want to pay the lowest price or negotiate the most favourable terms possible,” a paper says.

“These competing interests may make it challenging for registrants involved in these types of transactions to meet their obligations to their clients or to be able to advocate effectively on behalf of either party.”

The Ontario Real Estate Association welcomed the review since the governing legislation dates back to 2002, said CEO Tim Hudak.

“The world of real estate has changed tremendously in the last 15 years — much higher home prices, more sophisticated consumers, greater technology,” he said.

Consumers have raised concerns that the financial incentives in double-ended deals might lead to agents engaging in unethical behaviour, the government says.

“This divided loyalty and the associated risks may leave some consumers vulnerable even when written consent is obtained and the necessary disclosures ... have been made.”

Double ending is allowed if all of the clients the agent is representing give their consent to the

This divided loyalty and the associated risks may leave some consumers vulnerable even when written consent is obtained and the necessary disclosures ... have been made.

arrangement in writing.

Under proposed changes, different agents from the same brokerage could represent the buyer and the seller in a transaction. The “limited exceptions” to the doubleending ban would be if there is a private arrangement between family members or in a small market where there are very few agents.