Compensation payable by lessors in residential leasing

Discrimination against lessees

Real estate brokers must provide their services without discrimination, in accordance with section 4 of the Regulation respecting brokerage requirements, professional conduct of brokers and advertising. This means that they cannot accept lessors’ requests to exclude individuals with a certain profile from leasing a dwelling.

Representation of the parties

Under the Exclusive brokerage contract – Residential lease concluded with the lessor, the real estate broker must inform the lessee that he does not represent him and must treat him fairly. It is important to note that representing both the lessor and the lessee in a residential lease is not permitted.

Compensation

Compensation is not regulated by the Real Estate Brokerage Act, the OACIQ, or by any other law. It is determined by free competition. The form and amount of compensation are negotiable between the lessor and the real estate broker and must be clearly stipulated in the residential lease brokerage contract.

Forms of compensation under the Exclusive brokerage contract – Residential lease (BCL)

Percentage of rent: this is the most commonly used form. For example, if the parties agree on a monthly rent of $1,500 and the contract stipulates compensation equivalent to a percentage of that amount (e.g., 100% of one month's rent), the compensation will be calculated based on the accepted rent— i.e., $1,500—plus applicable taxes.

Lump sum: It is also possible to agree on a specific amount, regardless of the final rent. For instance, the contract may stipulate that the real estate broker will receive a fixed sum of $1,200, regardless of the rent amount agreed upon with the lessee. Applicable taxes will be added to this amount.

Other payment methods, such as an hourly rate: A different payment method may also be arranged, such as an hourly rate or billing by task. To do so, use the Annex RC – Remuneration and costs form, which allows you to include specific terms and conditions (e.g., reimbursement of advertising or travel expenses). If a special agreement is made, this annex must be attached to the brokerage contract.

For compensation to be payable under the exclusive brokerage contract, it is necessary that:

• An agreement to rent the property be concluded during the term of the contract and all of its conditions must be fulfilled–except for the signing of the lease–even if the lessor signs the lease without the broker’s involvement. It is important to note that, during the term of the contract, the lessor has undertaken not to enter into any agreement—either directly or indirectly—concerning the leasing of the property without the services of the agency or broker.
• A promise to lease, made in accordance with the terms and conditions of the lease, be presented to the lessor during the term of the contract but must not be accepted by the lessor.
• A lease be signed within 180 days following the end or termination of the brokerage contract with a person who was interested in the dwelling during the term of the contract, unless, during that period, the lessor entered into a new brokerage contract in good faith for the same dwelling with another agency or broker. In other words, if a lessee visited the property or expressed interest in renting it during the term of the contract, it may be considered that this was the property covered by the contract. The 180-day period is calculated from the termination date stipulated in the brokerage contract. If the contract is extended, the period will be calculated from the new end date. If the lessor terminates the contract, the 180-day period begins on the date of termination.

• A voluntary act on the part of the lessor prevent the performance of the brokerage contract. This clause applies when the lessor deliberately undermines the process outlined in the brokerage contract—for example, by refusing to provide documents required by the owner or by failing to attend the lease-signing meeting—which could compromise the conclusion of the lease, even if all other conditions are met.

Obligations of real estate brokers