Listing Agreements in BC: What You Sign When You Sell

When you list your home, you sign a listing agreement and receive a few standard disclosure forms, and together they decide how your home is marketed, what you pay and how the listing can end. Here is what each one covers in BC, the terms worth a close read, and the questions I suggest you ask before you sign.

The short version

Two kinds of listing contract

BCFSA, the regulator, describes two types of listing contract, and BCREA publishes a standard form for each:

• Multiple Listing Contract. Used when your home goes on the MLS® System. It is a form of exclusive listing: your brokerage has the sole right to sell, and it agrees to share a set portion of the commission with any real estate board member who brings the buyer.
• Exclusive Listing Contract. Your brokerage has the sole right to sell and can market the home, but it doesn't go on the MLS®, and sharing the commission with other brokerages is at the listing REALTOR®'s discretion. BCREA mentions privacy, restricted showings, pre-marketing and price testing as reasons sellers choose one.

Under CREA's REALTOR® Cooperation Policy, in force since January 3, 2024, a residential listing that is marketed to the public must go on an MLS® System within three days. To keep your home off it, you give a written instruction not to market it publicly, acknowledging that it may reach fewer buyers, after your REALTOR® explains in writing what the MLS® offers. An exclusive can still be shared within the brokerage and one to one with other agents.

Under either contract, if you sell during the term to a buyer you found yourself, BCFSA says you still owe the agreed commission, unless that buyer was specifically excluded in the contract.

The key terms

BCFSA generally requires a written service agreement, signed before your REALTOR® starts providing services, that includes your name, the property address, the start and end dates, a description of the services and the remuneration. You must receive a fully signed copy. Read these terms closely:

• Term and expiry. The listing runs from its start date to its expiry date. To extend it, or to change the price or any other term, you and the brokerage sign an amendment.
• List price. Your REALTOR® uses market research to help you set it, and you can ask for an estimate of your net proceeds before it is final.
• Remuneration. Commission is negotiable, and BCFSA doesn't set or approve it. It can be a percentage of the sale price or a fixed amount, but it can't be based on the difference between your list price and the sale price. The agreement must state the total you will pay and how much goes to a cooperating brokerage, meaning the buyer's brokerage.
• GST. CRA treats a registered agent's commission as taxable even though the sale of a resale home is generally exempt, so 5% GST is added. On an example commission of $30,000, that is another $1,500.
• When commission is earned. BCFSA notes that some listing agreements make commission payable if a full-price offer is submitted, even if you don't accept it, so check this clause.
• Holdover period. A holdover clause keeps commission payable for a set time after the listing expires if you sell to a buyer who was introduced to the home during the listing. Ask how long it lasts and what happens if you relist with another brokerage.

Marketing, showings and lockboxes

Your REALTOR® must act within the authority you give and follow your lawful instructions, so you can set conditions, such as notice before showings or no open houses.

• Advertising. BCFSA says a licensee shouldn't advertise your reasons for selling or your bottom-line price without your permission, photos can't be altered in a way that misrepresents the home, and an expired listing must come down from websites.
• Lockboxes. BCREA has a separate Lockbox Acknowledgement, Consent, Release and Indemnity form for discussing how a lockbox would be used and its risks. Ask who will have access and how showings will be booked.
• Your personal information. Expect to show government-issued ID, which federal anti-money laundering rules require, and to sign a privacy notice and consent form that records your consent to how your information is used and shared.

The disclosure forms you will see

BCFSA also requires a few standard disclosures. You may be asked to initial some of them, which is optional, and the two main forms say plainly that they are not contracts.

• Disclosure of Representation in Trading Services. Given at the outset. It explains whether the REALTOR® will act for you as a client, the duties owed to clients, such as loyalty, full disclosure and confidentiality, and how to contact BCFSA.
• Disclosure to Sellers of Expected Remuneration. Given with each offer or counter-offer. It shows in dollars, before GST, what you would pay the brokerage, how much goes to the buyer's brokerage and how much your agent's brokerage keeps. It is the only time the commission must be shown in dollars.
• Disclosure of Interest in Trade. Required if your REALTOR®, or someone associated with them, wants to buy your home, before you enter into any agreement with them. Their managing broker signs it.
• The buyer's rescission right. When an offer is presented, you also receive a disclosure of the buyer's right to cancel, in the contract or on a BCFSA form.
• Material latent defects. If your REALTOR® knows of a material latent defect, such as a hidden hazard or missing permits, they must disclose it to buyers in writing before a contract is made.

You will also decide whether to complete a Property Disclosure Statement, which is voluntary, or BCREA's newer Property No-Disclosure Statement. Either way, known latent defects still have to be disclosed.

What your REALTOR® owes you

Once you sign, you are a client. As BCFSA summarizes the rules, your REALTOR® must act in your best interest, follow your lawful instructions, tell you all known material information, present every offer promptly, keep your information confidential even after the listing ends, and avoid conflicts of interest where they can, disclosing any in writing.

Changing or ending a listing

Any change to the price, the term or the commission is made with a written amendment signed by you and the brokerage. Ending a listing before it expires also takes the brokerage's agreement, unless your contract itself lets you end it early. Talk to your REALTOR® or their managing broker, and read what you are offered:

• A cancellation. The listing ends early, but the standard cancellation can keep the brokerage's right to commission alive for a period afterward if the home sells.
• An unconditional release. Ends both sides' rights and obligations under the contract.
• A release with conditions. In a 2019 decision, the Civil Resolution Tribunal found that a brokerage was entitled to ask sellers for $5,000 to end a Multiple Listing Contract early, because nothing in the agreement stopped it from seeking compensation.

Put any concerns in writing to the managing broker. BCFSA investigates complaints about a licensee's conduct, but it can't make a licensee perform a contract, so for a contract dispute, talk to a lawyer.

Questions to ask before you sign

• How long is the term, and when does it expire?
• What is the commission, how much goes to a buyer's brokerage, and when is it earned?
• Does any clause make commission payable on an offer I don't accept?
• How long is the holdover period, and does it end if I relist with someone else?
• What happens if I want to end the listing early, and is there a cost?
• Are there buyers I already know of who should be named as exclusions?

BCFSA suggests getting legal advice before you sign if anything is unclear, and reminds sellers that the contract binds everyone who signs it.

Questions sellers often ask me

Can I cancel my listing agreement early in BC?

Usually only if the brokerage agrees or your contract itself lets you end it early. The brokerage may agree to a cancellation, an unconditional release or a release with conditions, such as a fee, so read what you sign.

Is real estate commission negotiable in BC?

Yes. BCFSA doesn't set or approve commissions. The amount, the share for the buyer's brokerage and when it is earned are all set out in your listing agreement.

Do I pay GST on my REALTOR®'s commission?

Yes. CRA treats a registered agent's commission as taxable even though the sale of a resale home is generally GST-exempt, so 5% GST is added to it.

What is a holdover clause?

It keeps commission payable for a set time after the listing expires if you sell to a buyer who was introduced to the home during the listing. Ask how long it lasts before you sign.

Do I have to list my home on the MLS®?

No. An Exclusive Listing Contract keeps it off the MLS®, but you give your REALTOR® a written instruction not to market it publicly. If it is marketed to the public, it must go on the MLS® within three days.

Getting ready to list? See what it costs to sell a home in BC, the BC selling process from listing to completion and how your list price is set.

This article is general information, not legal advice. Listing contracts differ, so read yours and get legal advice if any term is unclear. The details come from BCFSA, BCREA, CREA and CRA guidance that was current at the time of writing. For BCFSA's guide, see understand your listing agreement.