Maureen O’Neill first began working for the Toronto Real Estate Board (TREB) in 1980, as corporate relations manager; this year, she is part-way through her second term as TREB president. She had just begun serving as president-elect in 2007 when the new president accepted a job transfer out of Toronto. O’Neill moved up into the presidency a year early and, as a result, has been president during both the real estate market highs of 2007 and the lows of 2009.
O’Neill met with REM senior editor Kathy Bevan recently to discuss the challenges of the past year and a half, as well as the more prominent public advocacy role TREB has taken on.
REM: For the past two years, TREB has led a very public campaign against the City of Toronto’s land transfer tax increase – is this the kind of advocacy role you see TREB continuing to undertake?
O’Neill: Our lobbying efforts are becoming increasingly important, due to government intervention or government plans, which seem to be attacking the housing industry right at this very critical time of our economic picture. We’ve always lobbied in support of MLS, for private property rights and other issues, and those efforts have been successful at the federal level and at the provincial level. But the municipal level now is getting very, very busy and I see all boards across Canada having that same fight.
What’s happened in Toronto is a second land transfer tax, which was imposed upon the home buying public and really doubles their tax. TREB’s campaign against Toronto’s land transfer tax was overwhelmingly popular. We did a ground movement – we met with politicians, we lobbied, we got our members to write to their city councilors. It was a two-year battle and we were very successful in terms of getting people politicized. In spite of this, we lost by one vote, but we haven’t stopped.
The C.D. Howe Institute had a wonderful independent study by two professors at the University of Toronto and they determined there’s been a $170 million loss to Toronto as a direct result of the increase in the land transfer tax. We are never going to stop our efforts to have that tax repealed.
I think all this government intervention is going to move into other municipalities in time too. I think Toronto is the prototype; other municipalities are going to see housing as a cash cow.
Now, we’re facing the harmonizing of the GST and PST here in Ontario, which is going to have a very negative effect. We’ve also got all the extra taxes with garbage and water. So to me, advocating on behalf of our members on behalf of our clients, I see as a very important issue today.
REM: Your extended term as TREB president means you’ve been head of Canada’s largest board during both strong and weak markets – how did your role change as the market flattened?
O’Neill: I had to closely monitor things; to ensure we didn’t put any “spin” on figures, and to calm down the press, to give some perspective to the U.S. picture in comparison to the Toronto one. We could see our market declining, but not because of most of the issues people in the U.S. were facing. So as president of TREB, I had to be cognizant that the right story got out.
As a broker/manager, I came into the best market we’ve ever had. Really, it’s been an unprecedented 10-year run. I’ve been in the business a long time, and I’ve never seen a run like this – it usually lasts two or three years. But people started getting used to the idea that this was going to last forever – that mentality was there – and when it didn’t, it was quite a shock.
People had bought homes and paid a lot of money in Toronto’s peak market, because they thought, “if I don’t get in now, I’m never going to buy a house.” Now, in today’s market, you have all that psychological pressure happening – “I bought at the peak, I’m not going to make up for it”. So it’s been an interesting time.
I’m very happy that we’re in 2009, because we’re now comparing 2009 figures to 2008, which was a stabilizing, balancing year. Last year, when everything was declining, we were comparing 2008 to the best market ever – 2007 – so naturally the public said, “What do we do? Should we wait? Is this going to get worse?”
Normally we find that as soon as people start waiting for the bottom, it’s usually gone back up again. You’re waiting for the bottom, and then it’s too late. That’s why it’s called a real estate market – it’s a market like any other market. We just haven’t been used to the flexible things that have been happening in the stock market, for example – but real estate is a market and it’s always been a good long-term investment.
And as to the utilitarian aspect of living in a home – you can’t live in a mutual fund. I heard that saying a while back and I use it a lot. Memories of home live forever. You raise your family there, you have your friends there – it’s just that whole thing around house and home that is so very important. For most of the buying public that’s what it is – living in and enjoying their home. The majority of people buy because they want a home and they want a lifestyle and they’re prepared to wait out their investment.
REM: As a broker/manager, how are you advising your Realtors to work with prospective clients in this market?
O’Neill: We’re in the information business, giving people options. Information is not knowledge – people have to have the knowledge that goes along with all the statistics. I tell my Realtors to sit down with their client, do a portfolio with them and find out what their long-term and short-term plans are. And then, based on their needs, their budget, and their lifestyle, advise them as to what might work best for them.
What we’re telling people who say they’re going to lose something on their condo if they sell now, is that they also have the means to buy something good now too. There’s an old saying that you should always buy up in a down market. So if somebody says to me that they’re going to take $20,000 less for their condo than they did last year, I tell them they’re going to make $60,000 to $70,000 by buying up, because the high-end homes have come down a lot more. So is it worth it to wait and then not have that happen in three years – when you’re buying and selling in the same market, with all prices going up?
I tell Realtors to look at each case individually and not go by the herd mentality of what everyone else is doing. In any market, people should be prudent about their financial affairs. That’s what happened in the United States – people went in with no money down, they didn’t have any equity. There’s a price to pay for not making prudent decisions.
REM: There’s a large number of Realtors working today who were also working in this industry during the last big downturn in the ’90s. Do you think those Realtors were better prepared for this downturn, having survived the last one?
O’Neill: I think people quite readily forget the bad times when they’re in the good times. However, I do know what this group of people brings to the table and here at TREB alone it’s a huge group of people. This year we have 500 new 25-year members and something like 40 people celebrating 50 years, in addition to everyone who’s already in those two categories. What they bring to the table, more so than their optimism, is their ability to withstand the market. They’ve been there before, they know how to tough it out, they’re not as panicked as some of the new people who haven’t been through this before. So they take a much stronger, more optimistic approach – they know that housing will always rebound.
Realtors, including myself, believe so strongly in real estate, the investment in real estate and what it brings to your life. I’ve just been so privileged to be able to work with Realtors who are in it for the long term, who aren’t just in it for the good times, who are in it to make sure their clients are satisfied.
They’re very paternal about their clients and their care, all through the years. It’s the Realtor mentality – they’re in it for their career and they don’t give up.
REM: When you can finally step back from your two terms as TREB president, what do you hope people will say you were able to accomplish, through strong and tough markets?
O’Neill: I hope I’ll be seen as continuing to raise the bar of real estate as a profession. But I would also want them to think that I did everything in my power to put Realtors first – they are certainly No. 1 priority for me, the Realtors – and that I truly cared about their livelihood. Also, that I was able to help us make tremendous strides in the charity aspects of what we do at TREB – in our shelter-related efforts for example – and that we’ve been able to show the public that Realtors have a heart for the community.