Stay in Your Lane: Knowing the Limits of Your Role as a Licensee and Not Stepping Outside of It

Stay In Your Lane

In real estate, “staying in your lane” means a licensee knowing the limits of their role as a licensee and not stepping outside of it. Licensees are not lawyers, accountants, or mortgage specialists, and giving advice outside their expertise can put consumers at risk. By focusing on what they are trained and authorized to do, and referring clients to the appropriate professionals when needed, licensees uphold the standards of professionalism by protecting the public interest, building consumer trust, and ensuring that clients receive accurate guidance from the right experts. Real estate licensees are trained and authorized to provide services related to trading in real estate as defined in the Real Estate Trading Act (the Act or RETA) - not to give legal, financial, or tax advice.

A licensee must not guess, make assumptions or comment on things that are outside their area of expertise. The Commission By-law requires licensees to advise clients to seek independent professional advice on matters outside of the expertise of the brokerage or the designated agent.

Why It Matters

When licensees step outside their expertise or authority, they put consumers at risk of receiving inaccurate or incomplete information. For example, offering legal, tax, or mortgage advice without the proper qualifications can lead to costly mistakes or serious consequences for clients. Beyond the harm to consumers, this behavior damages the reputation of the profession and can expose both individual licensees and the industry to legal and regulatory consequences. Staying within the scope of practice is essential to protecting the public interest, maintaining trust, and upholding professionalism in real estate.

Licensees Working With Seller Clients

During the term of an agreement, the seller's licensee:

reviews, explains, and assists in the preparation of real estate forms;
prepares a competitive market analysis of the seller’s home or property for suggested list price;
develops and executes effective marketing strategies for the seller, including helping to establish the asking price, staging and positioning of the property;
informs the seller of what other properties have sold for in the same area;
presents all offers and counter-offers, and counsels seller on what price to accept
assist the seller in negotiating favourable terms and conditions with a buyer;
updates the seller on market conditions;
monitors all dates, events, and requirements (fulfillment of conditions); and
assists with any arising issues associated with conditions of the transaction.

Licensees Working With Buyer Clients

During the buying process, the buyer's licensee:

reviews, explains, and assists in the preparation of real estate forms;
searches for properties and provides information to the buyer;
arranges property showings that meet the buyer’s needs;
provides information that the buyer requests about a home or property, community, taxes, utilities and zoning, or refers the buyer to appropriate information sources; and
is obligated to discover facts pertaining to every property for which the buyer may be interested and which a reasonably prudent licensee would discover in order to fulfil the obligation to avoid error, misrepresentation, or concealment of pertinent facts.

During the offering process, the buyer's license:

prepares a competitive market analysis of the property for the buyer for suggested purchase price;
assists the buyer on what price to offer to the seller;
shows what other buyers have paid for properties in the area;
assists in preparing an offer;
assists the buyer in negotiating the best price and terms; and
keeps the price capabilities and objectives of the buyer confidential.

During the closing process, the buyer's licensee:

monitors all dates, events, and requirements (fulfillment of conditions) for the buyer;
assists with any arising issues associated with conditions of the transaction; and
attends the pre-closing viewing with the buyer.

What Falls Outside a Licensee’s Role

Activities that require outside expert advice from other professionals:

Legal advice → lawyers.
Tax implications → accountants.
Property boundaries, surveys, zoning → surveyors, municipalities.
Home condition, structural issues → inspectors, engineers.
Mortgage products & rates → licensed mortgage brokers or lenders.

Licensees Cannot Discourage Consumers from Seeking Expert Advice

Commission by-law 713 (do not discourage expert advice) states:

"A licensee must not discourage a client, an unrepresented person, or a party to a trade in real estate from seeking legal counsel or expert advice."

Real Estate Licensees Are Not Lawyers

Licensees are not trained or authorized to provide legal advice. However, real estate work involves legal contracts, agency relationships, and duties of care that carry legal implications. For this reason, licensees must understand the basics of contract law and related principles, not so they can provide legal advice, but to perform their role responsibly and to recognize when a situation requires a lawyer’s expertise.

The expectation is clear: do not act like a lawyer. When legal questions arise, licensees must refer their clients to a qualified lawyer. "Staying in your lane" protects clients, reduces risk, and ensures that consumers receive proper advice from the professionals who are authorized to give it. By focusing on their licensed responsibilities and making timely referrals, licensees help protect the public and maintain trust in the real estate profession.

Seek Legal Advice When Amending or Terminating Contracts

When proposing terms that could result in an agreement being terminated, buyers or sellers need to talk to their lawyer and get legal advice. Licensees are not lawyers and cannot provide legal advice.

Property Condition

Licensees representing residential buyers and sellers must be familiar with the basics of home construction and be aware of property-condition issues associated with resale homes. No one expects a licensee to be a technical expert, but general awareness of structural components, heating systems, finishes, and other related matters is required. Licensees must be aware of common potential problem areas, as well as new technologies and materials available to homeowners, which means staying up to date as things change. This knowledge adds to overall credibility and allows licensees to better assist their clients with negotiations relating to property-condition issues. Such issues can be identified at the time of listing a property, at the time of a buyer viewing a property or during the property-inspection process. With respect to licensees’ knowledge of property condition, the emphasis is on awareness and disclosure, not on advice. Licensees should leave technical discussions to home inspectors, septic professionals and well experts. Rarely does the problem revolve around a licensee not having enough technical knowledge about a property-condition issue. Instead, the problems involve licensees failing to disclose information about property condition, making assumptions about property condition that they should not be making, and giving advice to buyers and sellers regarding property condition that is outside the licensee’s area of expertise.

Septic Systems

Licensees need to be familiar with the basics of what a septic system is and how it works in order to perform their jobs effectively but must be cautious to not cross the line into trying to become, believing they are, or leading others to believe they are, septic system experts. Due to the potential risk to public health, most activities involving the treatment and/or disposal of on-site sewage are regulated by the province of Nova Scotia and require a trained and certified person to perform these duties. There are a number of certifications issued by the province:

A septic tank cleaner certification is required to pump, repair or modify a septic tank, holding tank or vault privy; pump portable restrooms or clean a disposal system using pressurized water or air (bed flushing).
An installer certification is required to install or modify a system. This would include repairing any damage which may have occurred to piping or bed materials, including erosion.
A qualified person certification is required to select a new or replacement on-site sewage system (up to 4-bedroom house - flows 1500 liters per day), assess a lot’s suitability to support a system when subdividing land or assess the suitability of an existing system for a proposed use when reconnecting power to a property, applying for building permits, etc.
A professional engineer may perform the duties of a Qualified Person as well as design a system for larger residential or commercial flows, malfunction replacements for systems where regulations cannot be met and systems utilizing advanced treatment units.

While Nova Scotia currently does not require a certification for persons undertaking an inspection of an on-site sewage system during a real estate transaction, Waste Water Nova Scotia recommends that only trained and certified persons perform this task.

A licensee's job is to request and verify information provided confirming the type of septic, and to share it with their client or to advise their client went to seek expert advise from a professional.

Wells, Water Quality and Water Quantity

Nova Scotia regulates who can work on wells by requiring that individuals be certified.

Real estate licensees need to be familiar with the basics of wells, water quality and related documentation in order to perform their jobs effectively. But they must not cross the line into believing, or leading others to believe, they are well or water experts. Most well-related and water-related lawsuits involving licensees have to do with licensees making statements or assurances about the condition and functioning of the well, the amount of water supplied by the well or the quality of the well water. These issues are all outside real estate licensees’ area of expertise, and they should not make such assurances to buyers, sellers, or other licensees. Licensees should leave well and water testing and treatment to experts. They should never be involved in pouring bleach into wells, also referred to as “shocking” the well. Collecting water samples or transporting and dropping samples off for testing should be done by the clients themselves or by an expert that the client hires to do so.

A licensee's job is to request and verify information provided confirming the property's well and water, such as well location, and to share it with their client or to advise their client went to seek expert advise from a professional.

Opinions of Value

Commission by-law 712 (opinions of value) states:

"(a) When asked to give an opinion of value of real property, the licensee must advise the client only after careful and thorough analysis and interpretation of all factors affecting the value of the property.
(b) A licensee must not provide an opinion or advice about the value of real estate to any person unless the licensee has education and experience related to the valuation of real estate.
(c) A licensee must not provide an opinion of value on a property for which the licensee has a present or contemplated interest."

Trading in Commercial or Other Areas – Just Because You Could, Doesn’t Mean You Should

Nova Scotia does not have separate licences for specialties such as commercial and residential trading. By holding a licence to trade in real estate in Nova Scotia, licensees are deemed to be competent and knowledgeable and are able to facilitate any trades in real estate within the province. However, Commission by-law 710 (duty to operate within skillsets), states:

(a) A licensee must advise a person to obtain services from another person if the licensee is not able to provide the services with reasonable knowledge, skill, judgment, and competence or is not authorized by law to provide the services.
(b) A licensee must not discourage a person from seeking a particular kind of service from another person if the licensee is not able to provide the service with reasonable knowledge, skill, judgment and competence or is not authorized by law to provide the service.
(c) When the licensee is unable to render such service, either alone or with the aid of other licensees, the licensee must not accept the assignment or otherwise provide assistance in connection with the transaction.

This essentially means just because licensees could, doesn’t mean they should. In fact, the above by-law prohibits the licensee from trading in real estate that is outside their area of expertise. Licensees are required to ensure their client’s interests are protected. If a consumer seeks a licensee's services but in an area they are not experienced in, such as a commercial trade but they've only previously traded in residential, the licensee are to recommend the consumer seek alternative representation with someone experienced in commercial transactions.

This by-law does not just apply to commercial transactions. Licensees must be cautious about conducting any trade in which they lack knowledge/training and experience. Other examples could include farm properties, condos, mini/mobile homes, or trades in other geographic parts of the province they are not familiar with.

The Difference Between Trading in Real Estate and Non-Trading Unregulated Activities

Trading in Real Estate
The Real Estate Trading Trading Act defines "trade" or "trading" as

"includes a disposition or acquisition of or transaction in real estate by sale, purchase, agreement for sale, exchange, option, commercial lease or rental or otherwise and any offer or attempt to list real estate for the purpose of such a disposition or transaction, and any act, advertisement, conduct or negotiation, directly or indirectly, in furtherance of any disposition, acquisition, transaction, offer or attempt."

Non-Trading Activities & Why Knowing the Difference is Important

Trading in real estate, as defined by the Act, does not include:

property management;
residential leasing;
facilitating construction of a dwelling on land already owned by the buyer;
the purchase or sale of mini/mobile homes without land;
the lease, purchase or sale of businesses without land; or
the lease, purchase or sale of assets without land.

Use of Commission forms for unlicensed trading services is prohibited.

Licensees are not prohibited from participating in non-trading activities/services, but when advertising or providing such services, a licensee must clearly disclose to consumers:

The services are outside the scope of trading in real estate are not being promoted or conducted as part of the brokerage’s real estate trading services of the brokerage;
The consumer protections administered by the NSREC do not apply, including regulatory oversight, Errors and Omissions Insurance, and the Real Estate Recovery Fund.

This applies to any advertising/promotion including, but not limited to websites (both brokerage and/or individual licensee), social media, billboards, etc. Failure by the brokerage/licensee to make adequate disclosure in this regard constitutes misleading advertising.