Ontario’s new real estate act, if passed, will give the Real Estate Council of Ontario broader powers to crack down on bad conduct and to consider factors such as past conduct and the public interest when determining registration eligibility. It will allow real estate professionals to incorporate. During the negotiations for a sale, it will permit salespeople to disclose details of competing offers if the seller agrees.
Nearly 20 years after it was passed, the act governing Ontario’s real estate industry is getting an update. The government introduced the Trust in Real Estate Services Act, 2019 in the Ontario legislature on Tuesday.
“This bill has been a long time coming and we’re thrilled to see the Ontario Government is determined to put buyers and sellers first, while ensuring Realtors have the tools and training needed to do the best job for their clients in today’s modern marketplace,” says Karen Cox, Ontario Real Estate Association president.
Among the proposed amendments are regulatory changes to streamline and modernize the code of ethics that real estate professionals and brokerages must follow.
RECO will be given authority to levy financial penalties (also known as administrative penalties) for failure to comply with a legal requirement (such as filing a document late) specified in regulations, the government says.
It would also allow RECO’s discipline committee “to consider a broader range of issues and provide it with the authority to revoke or suspend a real estate professional’s or brokerage’s registration or impose conditions on a registration. Discipline committee decisions may be appealed to the Licence Appeal Tribunal,” the government says.
Fines for rule breakers would increase, to a maximum penalty of $50,000 for salespeople and up to $100,000 for brokerages.
The proposals would also give RECO’s registrar “the authority to require that real estate brokerages and professionals provide data about real estate transactions to support risk-based enforcement.”
A specialist certification program would be developed by government or by RECO to ensure that real estate brokerages and professionals holding themselves out as specialists in a particular type of real estate (such as commercial real estate or waterfront properties) are certified as specialists.
The government also says it will reduce regulatory burden by simplifying “brokerage procedures by aligning the time that brokerages must hold unclaimed trust money in various circumstances.”
In a statement, Ontario Real Estate Association CEO Tim Hudak says, “For years, Ontario Realtors have advocated for higher professional standards, stronger consumer protections and better enforcement of the rules governing real estate practices.”
He says, “This bill will modernize the rules governing real estate practices and ensure that the Realtor at your side during the biggest transaction of your life has the highest professional standards, training and modern tools in North America.”
John DiMichele, CEO of the Toronto Real Estate Board, says, “We are pleased to see business fairness being addressed by allowing all Realtors to run their businesses more efficiently by forming personal real estate corporations, if they so choose – a tool that’s available to Realtors in six other provinces and many industries in Ontario. TREB’s Board of Directors started to formally tackle the ability to form personal corporations as a business fairness issue dating back to 2005 and is pleased to see our efforts come to fruition with the help of OREA.”