Humber/Ontario Real Estate Course 3 Exam Practice

If a seller confides a lower price they are willing to accept to a listing salesperson, what is the salesperson's obligation?

1. Should contact any potential buyers and advise them of the seller's comments in hopes of securing an acceptable offer.

2. Would breach his obligation to maintain confidentiality, if he provided this information to any prospective buyer.

3. Would have the right to discuss this matter with the potential buyer, if that buyer is seriously considering the house and is submitting an offer.

4. Can advertise the following: Listing price: $499,500, all offers above $450,000 seriously considered.

5. Can discuss the information only with colleagues within the same brokerage for strategic purposes.

6. Must immediately update the listing price to reflect the lower acceptable price.

The correct answer is: Would breach his obligation to maintain confidentiality, if he provided this information to any prospective buyer.

The obligation of the listing salesperson regarding the seller's willingness to accept a lower price is to maintain confidentiality. This means that if a seller confides information about their minimum acceptable price to the salesperson, the salesperson is bound to keep this information confidential and cannot disclose it to prospective buyers. Maintaining confidentiality is crucial in building trust between the seller and the agent, as it ensures that sensitive information does not get into the hands of other parties who could use it to their advantage. Disclosing this information could undermine the seller's negotiating position since potential buyers would have insight into the seller's bottom line, thus potentially driving the offers lower than what the seller might actually want. It's fundamental in real estate practice to preserve the confidentiality of negotiations and personal seller information unless the seller explicitly instructs otherwise. The other options present scenarios that compromise this ethical obligation. For instance, discussing the seller’s bottom line with potential buyers, even if they are seriously considering the house, or advertising the lower price, would breach the confidentiality that the salesperson is obligated to uphold. Therefore, recognizing the importance of confidentiality in the real estate transaction process is essential for anyone practicing in the field.