Your Ontario Realtor’s Duty to Clients

No question buying or selling a home in Greater Toronto is expensive, which is why your realtor’s duty to clients is so important.

What’s that, you say? 

Realtors have a fiduciary and moral duty to you whether you’re a full service client or limited service customer. Here’s the difference, and why a realtor’s duty to clients matters when you buy or sell real estate.

Discussing together with your client

Quick Read

What is a realtor’s job?

What are the responsibilities of real estate agents?

Paying your realtor’s commission

Who gets the deposit?

Who’s liable when property is damaged?

Can I sue my realtor in Ontario?

Your Realtor’s Job

When you request advice from an Ontario REALTOR® you can expect:

  • advice on deciding what kind of home you want
  • notices of open houses
  • showings of Multiple Listing Service (MLS) properties that fit your home buying profile 
  • information on neighbourhoods you may be interested in
  • up to date comparatives on home prices in your area
  • assistance drafting an agreement of purchase and sale
  • help making counter offers or amendments
  • introductions to mortgage brokers, insurers, movers, and other services you may need
  • if you are selling, advice on staging your home and presentation of written offers from potential buyers. 

Picking paint colours that appeal to home buyers. Things to think about before you repaint a heritage home

Responsibilities of Real Estate Agents in Ontario

You can count on your realtor for fair dealing, honesty, and integrity. Ontario real estate agents have a responsibility to uphold their fiduciary duty in all real estate undertakings.

  1. No Misrepresentations.

Realtors must take due care information they give you is accurate and not misrepresented. They will protect your personal information and not disclose or sell it to third parties, including marketers, without your permission.

  1. Honest Disclosure.

Realtors are only required to disclose information they already or ought to know about a property to customers. Because you may not get all the material facts on a property, a home inspection is recommended. Clients are owed a higher duty of care. That includes taking reasonable steps to research, investigate or consult before giving you information or advice you rely on to buy or sell property.

  1. Presenting Offers as Written.

Your realtor must disclose all offers they receive for your home, unless you have a customer service agreement. If you are the buyer, they will disclose if a seller has pending offers or you are part of a bidding war. They must present your offer as written and may make suggestions about how to make your offer more attractive.

  1. Avoiding Undue Influence.

Sellers and buyers are not obligated to accept realtors’ advice, but as long as you have a signed client representation agreement, you cannot ask another realtor to represent you or negotiate a sale directly. If a bidding war occurs, your realtor can’t coerce or unduly influence you to offer more than you want. Your realtor may owe you damages if they breach their contract with you. What to look for when it’s undue influence

Axess Law strongly suggests you weigh your needs carefully before you sign the  agreement of purchase and sale. Our licensed real estate lawyers can give you any legal help you need buying or selling a home, 7 days a week. 

Paying Realtor Commissions

Your realtor will only charge a commission if they successfully help you buy or sell your home. Commissions range from 1% to 9%, depending on what services you contract for. If you feel a commission is unfair, you can complain to the Real Estate Council of Ontario (RECO). File a complaint about a realtor. 

Who Gets the Deposit

Realtors typically suggest a deposit of one to three per cent of the purchase price (more in competitive markets) to make your offer more appealing. Your deposit is held in trust by the real estate brokerage until the sale is concluded. Provided you haven’t paid a deposit, you may withdraw your offer without penalty or complications before it expires. 

If you withdraw your offer because some of your conditions are not met, your deposit may be refunded. But if you fail to make your offer conditional or specify you want the deposit back if the deal falls through, you may forfeit part or all of it or, worse, have to compensate the seller for the inconvenience. More on if a real estate deal falls through who gets the deposit

Since your agreement is legally binding, Axess Law recommends reviewing it with our real estate professionals by video conference call before you sign. We do remote video calls throughout Ontario or can meet you at any of our Greater Toronto Area law offices. Our flat fee rates make buying or selling a home affordable. .

Buying Damaged Property

When you buy property, you expect it to be in livable condition. Unless you hire a home inspector, you could be inviting problems. Ontario realtors are not required to give you a seller property information sheet (SPIS). Fortunately, your realtor cannot withhold information from you at a seller’s request. What to expect from a home inspection.

You may have a legal action if a realtor misrepresented how serious visible defects were — they’re called patent defects you could discover on your own — or the seller hid latent (not visible) defects like a faulty foundation. Who’s liable for undisclosed defects. 

When to Sue a Realtor in Ontario

Your realtor (or a seller) may have wronged you if they:

  • didn’t mention major defects or material facts like a costly strata assessment they knew about
  • disadvantaged you, such as your realtor telling a seller you were willing to pay more than offered
  • represented both seller and buyer without consent. called dual agency or multiple representation — real estate brokers can be fined up to $50,000 for “double-ended” sales
  • put their interests first, such as your realtor was paid by a competing buyer to withhold offers or promoted a mortgage broker who paid for referrals
  • secretly profited by buying a property you made an offer on
  • neglected to use skill, competence and care, including missing deadlines or failing to give sellers your offer.

Ontario courts look to what a reasonably careful real estate agent would do. Axess Law’s licensed real estate lawyers help you get more for your money by making real estate closings affordable. Our real estate attorneys can advise if you have a legal case against a realtor and refer you to lawyers who can represent you. 

Affordable Real Estate Lawyers, Anywhere You Are 

Access lawyers for less in Greater Toronto Area, Ottawa, or by remote video conference. Our flat fee rates are affordable, and all inclusive (excluding taxes, disbursements, and third-party charges). Our final invoices include no surprises, or hidden charges. The itemized statement of adjustments is explained when we deliver it, and we answer any questions your clients have about it. Get independent legal advice, or add a family member to a property for a modest title transfer lawyer fee. Axess Law offers only the legal services your clients absolutely need. 

Find a virtual real estate lawyer.

Book Video Call or In Person Appointments Now

Call us before you make an offer to purchase or sign a real estate representation agreement you find unclear. Remote video call appointments are available 7 days a week,at your convenience. Book day or evening appointments online with our easy web form, or call our 647-479-0118 lawyer line, toll free to 1- 877-522-9377. Our conveniently located Greater Toronto Area and Ottawa Axess Law locations have onsite parking and easy transit access.

Click here for more on Axess Law’s affordable real estate services.