Beware of Unlicensed Lead Generation Services
Looking for leads? There are lots of companies eager to sell leads to real estate licensees. But beware: engaging a lead generation service could put consumers at risk, and could put you on the wrong side of the Real Estate Services Act. You could face an investigation and potential discipline. Here’s why:
Companies that find people who are interested in buying, renting, or selling real estate, and that refer those people to real estate professionals for a fee (including online and telephone solicitation—e.g. ‘cold calling’), are soliciting for the purpose of providing real estate services. This activity—soliciting for the purpose of providing real estate services—requires a real estate licence.
Before you accept any referrals from a lead generation service, ensure that the company you are dealing with is licensed to provide real estate services in BC. As a real estate professional, you cannot pay unlicensed people or companies for providing real estate services.
The only circumstances in which you could pay an unlicensed person or company for a referral are if:
- they do not engage in activities to solicit the names of people who may be interested in acquiring or disposing of real estate; and
- making referrals and receiving referral fees is incidental to their main business.
Lead Generation Can Be Risky
If you are considering selling leads, keep in mind that as a real estate professional you cannot accept any remuneration in relation to real estate except through your brokerage. If you are found to be operating a lead generation service outside of your brokerage, you may be subject to discipline for contraventions of the Real Estate Services Act and Rules.