Very low offer price: The obligations of brokers involved
When selling a property, it may happen that a buyer wishes to make a very low offer. Here are the duties of brokers involved in three common situations.
The seller’s broker
The seller’s broker is subject to his contractual obligations. In accordance with clause 9.1 (2) of the brokerage contract to sell he signed, he must, in particular, “submit to the seller, as soon as possible, any written promise received regarding the purchase, lease or exchange of the immovable.” He should therefore draft the promise to purchase of an unrepresented buyer if the latter so requests, even if the price offered is very low.
Check this decision on guilt and sanction of the OACIQ Discipline Committee where a seller’s broker refused to draft a promise to purchase.
You may however note that the seller could exceptionally and in writing give contrary instructions to his broker.
The buyer's broker bound by contract
In the same vein, nor may the buyer’s broker who is bound by a brokerage contract to purchase fail to meet his contractual obligations by not drafting a promise to purchase that his client would like to make on the grounds that the offered price is really too low. Under clause 8.1 (2) of the form, he must: “submit, as soon as possible, any written promise, lease or exchange received from the buyer regarding the immovable.”
The broker representing the buyer without a written contract
The broker who represents a buyer but is not bound by a brokerage contract to purchase must act in the best interests of the buyer. In particular, he must advise him properly regarding the price to offer based on his verifications and analysis of comparables. He is however not required to draft a promise to purchase with a very low price that the buyer absolutely wants to make. In this case, the buyer may still present this offer directly to the seller’s broker.