An Alberta real estate professional is asked to represent a buyer in purchasing a property owned by the professional's family member. What is the professional's obligation?

Q: What is the correct answer to: An Alberta real estate professional is asked to represent a buyer in purchasing a property owned by the professional's family member. What is the professional's obligation?

The correct answer is The professional must make full written disclosure of the conflict of interest to the buyer before proceeding. The RECA Code of Conduct requires industry professionals to disclose any conflict of interest in writing before entering a service agreement or proceeding with a transaction. A family relationship with the seller is a material conflict. Written disclosure allows the buyer to make an informed decision about whether to proceed.

Q: What background knowledge is needed for this Agency & Professional Ethics question?

Alberta's RECA Code of Conduct addresses conflicts of interest to protect consumers. Common conflicts include personal interest in the property, relationships with other parties, or financial interests beyond commission. The requirement for written disclosure ensures transparency and creates a documented record of the client's informed consent.

Q: What is a good way to remember the answer to this Agency & Professional Ethics question?

Any personal connection to a transaction = written disclosure first. Think 'family, friends, finances — if connected, disclose in writing before proceeding.' On the exam, when you see scenarios involving personal relationships or interests in a transaction, remember that written disclosure is always required before proceeding.

Q: What exam tip applies to this Agency & Professional Ethics question?

RECA rarely requires complete withdrawal from a transaction. The typical correct answer involves written disclosure and informed consent, not outright refusal.

Q: How does this Agency & Professional Ethics concept apply in real world practice?

An associate's sister lists her condo for sale. A buyer client asks the associate to help purchase it. Before showing the property or writing an offer, the associate provides the buyer with a written disclosure explaining the family relationship, allowing the buyer to decide whether to continue with the associate or seek independent representation.

Question

Agency & Professional EthicsABMEDIUM

An Alberta real estate professional is asked to represent a buyer in purchasing a property owned by the professional's family member. What is the professional's obligation?

Answer Options

A

The professional must decline the transaction entirely

B

The professional must make full written disclosure of the conflict of interest to the buyer before proceeding

C

The professional may proceed without disclosure if they treat the buyer fairly

D

The professional should disclose only if the buyer asks directly