Shady real estate agents, watch out: The minimum fine for realtors who fail to follow the Real Estate Board of Greater Vancouver’s code of ethics has tripled from $10,000 to $30,000.
“It was getting to the point where the committees felt like the response was that it was just the cost of doing business,” REBGV president Dan Morrison told Vancity Buzz. “It really wasn’t enough of a deterrent.”
“We needed to make it a bigger deterrent – a bigger ‘ow’.”
The fine may not only apply to the unethical real estate agent, says Morrison, but it could also apply to their managing broker as well. In order to receive a fine, Morrison says the wrongdoing would have to be “pretty egregious.”
“Outright fraud, very serious breaches of our rules of cooperation and code of conduct – every situation is a little bit different, so it’s hard to generalize on those things.”
When it comes to shadow flipping, however, the rules get a bit foggy. Shadow flipping is the process of reselling a home for profit before a sale closes, meaning agents can make multiple commissions from one property. Assignment clauses, as they’re properly known, are necessary in the event of unforeseen circumstances, such as the home buyer losing their job or a market crash. Putting a stop to them completely isn’t the answer, according to Morrison.
Premier Christy Clark recently announced new rules for shadow flipping where all profits made from assignments would go back to the home owner rather than the selling agent. Morrison says the premier’s new rule is a knee-jerk reaction.
“They want to give the profits back to the seller, but what about from the other side of the coin? Will they take the losses back, too? I don’t think so.”