Nick Answers Reddit
Do Buyers typically use a Realtor to buy a new build home?
“I recently received a representation agreement from the seller/builder’s agent of a new build I’m interested in (Ontario). It states that the buyer would be agreeing to have this person represent them on anything purchased in the city and surrounding area, not just this build. It also vaguely describes possible commissions that the buyer may owe, and says I could be liable for commission even 90 days after the contract ends. I have a mortgage broker but no agent, and I’m hesitant to sign this. Is this normal?”
Nick Answers Reddit
Every week, Nick answers a Redditor’s question about buying, selling, renting, investing or living in Ottawa. Send Nick your own questions on the website, on Reddit or on a YouTube comment!
Nick's Response:
You’ve received some good advice already, and this situation comes up fairly often with new builds in Ontario. Here’s what you need to know:
You’re Not Obligated to Sign with the Builder’s Agent
If you haven’t signed any agreement yet, you’re not legally required to use the builder’s agent as your representative. If you do decide to, you can (and should) ask to limit the scope of the Buyer Representation Agreement (BRA) to just this property or development.
✅ 60 days + 90 days holdover isn’t unusual, but if it doesn’t feel right, you’re well within your rights to ask for a shorter or more specific term.
What a Buyer Representation Agreement (BRA) Means
In Ontario, agents must provide and explain the RECO Information Guide before signing a BRA. If this wasn’t fully explained, the builder’s agent has skipped an important best practice.
Here’s what to look for in your BRA (usually Form 371 in Ontario):
Commission: This could be a fixed amount or a percentage. Understand whether you’d owe anything out-of-pocket if the builder doesn’t pay the agent.
Scope: This should reflect a specific area or property type—not “anything in Ontario.” You can absolutely restrict this to one property.
Time Limit: 3-6 months is typical. Push back if the holdover period is more than 90 days, which can feel punitive.
Everything in a BRA is negotiable. Don’t accept “it’s standard” as an answer. It’s your agreement—make sure it works for you.
Do You Need a Realtor for a New Build?
It depends:
Big builders often use in-house sales teams and might refuse to pay your Realtor’s commission, especially if you contact them directly.
Smaller builders may list with Realtors on MLS. If the home is on MLS, you’re free to use your own Buyer’s Agent, just like with any resale home.
If you do decide to hire a Realtor, check out my guide to questions you should ask when interviewing one.
Three Final Tips:
1. Don’t Sign Anything You Don’t Fully Understand
Always ask questions and make changes to agreements before signing. It’s your right.
2. Understand How Commission Works on New Builds
Clarify whether the builder pays the agent, or if you might be on the hook. This varies case-by-case.
3. Limit the Agreement if You’re Unsure
Ask to restrict the scope of the agreement to a specific property, development, or time frame.
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