What Is the Real Estate Services Act in BC?

If you are buying, selling or renting in British Columbia, you will deal with licensees who work under a law you may never have read. Knowing the basics helps you understand what you can expect and where to turn if something goes wrong.

This article explains in plain language what the Real Estate Services Act and its Rules do, who they cover, and what protections they give buyers and sellers.

This article covers the law of British Columbia.

What the Act is and who enforces it

The Real Estate Services Act is the BC law that regulates real estate licensees. In the Act, the Authority means BCFSA (BC Financial Services Authority). The Authority's board must appoint a Superintendent of Real Estate, who exercises the Act's powers and may delegate them in writing.

On August 1, 2021 the Office of the Superintendent of Real Estate and the Real Estate Council of B.C. integrated with BCFSA, which is now the sole regulator for BC financial services including real estate. Older material that refers to the Real Estate Council may be out of date. BCFSA licenses and regulates real estate agents, rental property managers and strata managers, and also regulates real estate development marketing.

Who must be licensed

A person must not provide real estate services to or on behalf of another for remuneration unless licensed or exempt. The exemptions include persons acting under court authority, certain trustees and executors, and practising lawyers.

What licensees owe you

The Rules distinguish between a client, the principal who has engaged the licensee, and an unrepresented party, a party to a trade who is not a client of a licensee for that trade. The Rules do not use the word customer.

• To a client: act in the client's best interests, keep client information confidential, disclose all known material information about the services, and communicate all offers in a timely, objective and unbiased manner.
• To everyone, including non-clients: act honestly and with reasonable care and skill.
• Before providing trading services: disclose whether or not they will represent you as a client.
• If they represent a client: tell an unrepresented party the risks of receiving assistance from the licensee and recommend independent professional advice.

A brokerage providing trading services must have a written service agreement signed by the client and an authorized brokerage signatory, unless the prospective client waives it. A brokerage must also not engage in dual agency, subject to limited exceptions.

How your money is protected

A brokerage must pay all money received from or for a principal in relation to real estate services promptly into a BC interest-bearing trust account. A licensee providing trading services is exempt from the requirement to pay this money into a trust account only if all principals agree in a written agreement separate from the trade agreement and any rule conditions are met.

Deposit money held for a trade is held by the brokerage as a stakeholder and not as agent for one of the parties. The stakeholder rule applies unless the parties agree otherwise in writing or regulated circumstances apply, and it does not cover items such as periodic rents and tenant security deposits. If there are adverse claimants to trust money, a brokerage may apply to the Supreme Court to pay the money into court.

Brokerage records, including trade record sheets showing every disbursement of deposit money, must be kept at least 7 years after creation unless the superintendent authorizes a shorter period.

When something goes wrong, and next steps

A Special Compensation Fund claim must be made in writing to the superintendent within 2 years after the earliest of the listed events. The caps are $200 000 to a single claimant and $1 000 000 total for claims related to a single brokerage.

Unless a complaint is anonymous, the superintendent must acknowledge it and inform you of the outcome. Gather your documents, act promptly because time limits apply, and consider speaking with a lawyer about your options.

Frequently asked questions