Real-estate deals can go sour: What to do
TORONTO — They say breaking up is hard to do — and that most often can be the case when it comes to leaving your real estate agent.
Although not overly common, there may come a time when you want to ditch the real estate agent you have entrusted to help you sell or buy a home.
However, if you have signed a contract to work with your agent, chances are you’re stuck with them, at least for a while.
Real estate agent André Pasche says the top reason why a client may want to dump their listing agent before their contract ends is that they blame them for not being able to sell their property.
“You can find yourself at a standstill,” said Pasche, who is with Norman Hill Realty in Markham, Ont. “The house isn’t selling, the real estate agent isn’t going to cancel the agreement, so nothing is going to happen. Basically everybody is wasting time because they’re mad at each other.”
Other reasons why a homeowner may become unhappy can include a real-estate agenty overpromising in their pitch, convincing the owner the home is worth more than market value or added services such as staging and marketing materials were not delivered to their standards.
Alternatively, homebuyers can become frustrated if they keep losing out on bids, or begin to not trust the expertise or advice given to them by their buying agent.
In these scenarios, there is little recourse for someone who wants to back out of a contract, says Pasche.
The first step an unhappy client should take is to express their concerns with their agent to see if they’d be willing to break the contract.
If that’s not possible, they can speak with the agent’s manager and ask to work with another salesperson in the company. Switching agents within the same brokerage does not contravene the original contract, which is usually signed with a brokerage, not an agent, for anywhere from 60 to 90 days.
Lastly, the homeowner can reach out and file a complaint with the regulating real estate body in their province, such as the Real Estate Council of British Columbia, which can often be laborious and time-consuming.
Pasche says the simplest way to stop working with an agent is to wait until the contract expires, pull the property off the market and relist it with a new agent.
Listing agents are often reluctant to let clients break their contracts because they typically spend hundreds of dollars on staging the property, creating a website and hiring a professional photographer. Some real-estate agents may agree to void the contract, but will insist on being reimbursed for these costs.
John Pasalis, president of Realosophy Realty, says his company always adds a special clause in their buyer and seller contracts that allow clients to leave at any time — even though it’s not standard industry practice.
“As you’re working with someone, and they give you the authority to represent them, if they’re not happy, then what is the point of locking in someone to work with them?” he asked. “To me, it only makes sense to let buyers move on if they’re not happy.”
Pasalis suggests homeowners and homebuyers should interview two or three real-estate agents before committing. Ask yourself whether you trust them, trust their advice and experience, and the likelihood they could deliver on their promises.
The best way to ensure a content relationship is to hire someone based on a referral, he added.
Clients should also be wary before signing on the dotted line, and ask to see if the contract period could be negotiated.
Pasalis says potential homebuyers are usually not asked to commit with a real-estate agent until the first offer is made. This contract could be added to the pile of papers clients need to sign for a bid, and before they know it, they’re locked in with a buying agent for six months to a year.
“Like all other things, you need to think about this stuff before you sign,” he said. “You don’t want think about the worst case scenario after you’re in that relationship. The first thing to do is be preventative. Have that discussion or add clauses in the contract that allow you to cancel.”