Apologies in advance to non-Ontario readers, but maybe this provincial experience has a national ring to it.
A Real Estate Council of Ontario (RECO) news release summarized its recent survey: “… almost half (45 per cent) of first-time buyers and 41 per cent of homeowners wish they had done something differently during the transaction… A further 32 per cent of first-time homebuyers reported that they did not feel prepared and knowledgeable about the process, and only half of Ontario homeowners aged 18 to 34 felt they were prepared and knowledgeable about it.”
The next question might logically have been, “Did you use a Realtor?” If so, then this would be a testament to the service quality of those involved Realtors.
An August 23, 2012 Globe and Mail article says, “It is widely accepted that about 90 per cent of all home sales in Canada take place through the Multiple Listing Service… But that number is an educated guess, because there is no database that includes both houses sold by agents and those sold privately.”
RECO said in an email: “We didn’t ask (the 1,043) survey respondents to clarify whether they had worked with a registrant … The intention of the survey was to highlight that buying or selling a home is a complicated process and consumers may have regrets if they don’t educate themselves about the process.”
RECO’s news release also stated, “We encourage buyers and sellers alike to work with a registered real estate professional.” However, if most of the “regretful” buyers were using Realtors, how is RECO serving the public’s interest by recommending undertrained Realtors to consumers?
Who really failed these buyers? Given organized real estate’s dominant market position and the survey’s self-measured performance, it appears that real estate boards and their support/management organizations failed them.
RECO responded quickly with good intent but arguably flawed logic with its Fact or Fiction campaign, designed to empower consumers with more knowledge to make better decisions. But it was like doctors telling their patients to learn about remedies for their symptoms so the patient could decide whether the doctor knows what he’s talking about. There’s some sensibility to this, but then what is the doctor’s professional role in providing a guiding, advisory and informed service? Is RECO telling the public that they shouldn’t trust a Realtor’s professional advice? Assuredly, they didn’t mean to but it’s definitely a confusing message.
RECO published a whitepaper on its proposed vision for registration education and solicited input, which this writer did. An auto-reply stated, “Please note that there will be no formal replies issued to any specific comments.” Still, it’s also a good step in the right direction but it falls far short of any permanent, positive solution.
Organized real estate should be looking inwardly to find solutions to substantially improve the quality of service and expertise of Realtors before spending resources encouraging consumers to use Realtor services that aren’t up to the public’s expected standards.
The high turnover rate of Realtors must be stopped. The odds are currently very high that a member of the public is going to be serviced by an inexperienced Realtor, a statistic that appears to be borne out by the RECO survey.
A minimum two-year college or university program with a focus on a specialization in the second year would turn out solid, well-qualified apprentices. The program must embrace real-world tools that Realtors will use in their real-world jobs. A post-graduate course, after, say, at least three years of experience, would allow them to become a broker of record.
Applicants should perhaps be required to pass ethics and English competency tests before they can register. The language test is not prejudicial. Some words/concepts will be learned in real estate courses, but with 135 legislated acts to be aware of in Ontario, for example, there are many other words that are necessary to professionally function in real estate.
Realtors should academically prove their in-depth knowledge of each major property type before they’re licensed to sell it. It’s unrealistic to expect a Realtor to know everything necessary to fulfill their duty of care and skill in selling/buying a retail plaza, farm, oil refinery, condominium, estate home, manufacturing facility, office tower or the most potentially litigious property of all – the cottage.
The graduate has proven their academic mettle but they’re still hardly qualified to help a family make the most important financial decision in their lives or to assist an investor in making a major investment decision. A graduated license that begins with an apprenticeship is a critical success factor, just like it is for other professions and over 200 trades.
Brokerages mandated to invest in mentoring, not just tutoring, each registrant they take on would ensure that only the best would find jobs and become established in the industry.
More of the “same old” will not change the growing tsunami of Realtor irrelevancy that is crashing against Canadian real estate industry walls.