By Joseph Richer

Last fall, my colleagues from the Real Estate Council of Ontario (RECO) and I crisscrossed the province to meet with industry leaders in a series of town hall events we held in Cambridge, Thunder Bay, Ottawa, Orillia, Windsor, Ajax and Vaughan. We arranged this round of town halls to discuss some big-picture topics such as the importance of RECO and the industry working together to help raise the bar of professionalism, the educational requirements for real estate salespeople and brokers, RECO’s new Strategic Plan that will help us become a modern regulator, and our work with government to reform the Real Estate and Business Brokers Act, 2002 (REBBA).



Much like the 2017 town halls, the 2018 events were lively at times, but always thoughtful and respectful. The industry leaders who attended provided a lot of valuable feedback that will help us better understand what’s happening in the marketplace. I’d like to take this opportunity to share a bit of what we heard.

Raising the bar of professionalism:

The industry leaders were engaged and highly committed to working with RECO to raise standards within the profession to better serve and protect consumers. A few attendees told me there’s a perception in the industry that RECO only listens to complaints from consumers, not our registrants, and that some brokers of record could do a better job of fulfilling their regulatory obligations.

Let’s dispel the myth about registrant complaints: we assess every complaint we receive, and we provide the same investigative effort regardless of who contacts us. On an annual basis, 25 to 30 per cent of the complaints we receive come from salespeople and brokers. I think that shows the industry is serious about working with us.

I’ll add that we have worked hard to improve our complaints process, and it now takes an average of about 70 days to resolve a complaint.

The law requires and RECO expects brokers of record to take responsibility for the people they hire. We understand that the size of brokerages today makes it difficult to directly oversee everyone personally, but that can’t be the excuse for looking the other way. Brokers of record must have the right managers and systems in place to do things correctly.

My experience has been that most brokers of record – including the industry leaders who attended the town halls – understand RECO’s expectations and value the work we do to maintain public trust in the profession.

OREA’s proposed REBBA reforms:

My colleagues and I received a number of questions about Roadmap to a New REBBA, the list of recommended changes to REBBA that was released last year by the Ontario Real Estate Association (OREA). More specifically, industry leaders wanted to know if the industry’s regulator (RECO) and the industry’s association (OREA) are on the same page.

For the most part, I’d say we are. Our colleagues at OREA put a lot of thought into their recommendations, and I’m glad we’re having important conversations about protecting consumers while balancing the needs of the profession. We need to strike the appropriate balance and the only way to get there is to discuss the benefits and impacts on everyone involved.

In 2017, RECO submitted its own set of recommended REBBA reforms to the Ministry of Government and Consumer Services. I encourage you to read them on the RECO website.

Personal real estate corporations:

Industry leaders were very interested to hear RECO’s position on the introduction of personal real estate corporations (PRECs). Though we don’t have a position on the government providing salespeople with the option of being taxed as corporations, we would support a system that creates the least disruption or burden on registrants – one that does not require a new class of registration if it is possible to do so. We have to balance the needs of consumers and registrants.

Electronic file storage:

Some of the town hall attendees also asked for clarification on the rules regarding electronic file storage and inquired about whether or not REBBA could be reformed to allow brokerages to store their files outside Ontario. To be clear, it’s perfectly acceptable to store files (electronic or paper) outside of the province so long as there’s at least one copy somewhere in Ontario. The reason is enforcement: RECO needs to be able to access a brokerage’s files during an inspection or an investigation and RECO’s authority applies only in Ontario.

Thank you to everyone who attended the town halls and provided us with valuable feedback.

4 COMMENTS

  1. Nelson DeHoey & Carolyn L both appear to be thoughtful intelligent Realtors with very good points articulately stated. I will shorten my normal lengthy response, it appears that some group of dolts have decided to indulge their fantasy to require all new realtors to graduate from college prior to embarking on a career.in Real Estate.
    The only thing missing from the prior system was a way to accurately identify each applicant to irrefutably verify their true identity. Any person who personally attends all classes, reads and understands the text books and writes the exam will have the knowledge to proceed, Six deals a year should be a minimum.
    Education by itself is no indicator, a friend who retired as an inspector with one of the major Canadian banks thought he could sell one or two homes a month so he wouldn’t be bored. He did all the right things, flyers, door knocking, kiosk sitting etc.. After two years his brokerage gave him a captive buyer as a referral. This was his first and ONLY sale, he retired after closing.
    Sales is connecting with a person, finding their need, filling the need, while looking after the best interest of the client in an ethical fashion. Owning a pair of skates does not make a hockey star.

    Perhaps joining CPSA (Canadian Professional Sales Association) and taking some of their myriad of courses will help.
    Regards
    Calder Weatherston

  2. Dear Joe,

    Your articles in The Star are hilarious and it is blatantly clear as a former funeral home regulator, your real estate advice is coming from the REBBA violating realtors who are on your board. I mean come on Joe when you simply going to hold your board to meeting the simplest advertising rules about their names, designation and contact details?

    OREA and Tim have lobbied long and hard to allow the American Franchisors to maintain market share and avoid Class Action Lawsuits for undisclosed Dual Agency. Old timers will remember Tim was the government in charge when the Harris Government got conned into allowing Dual Agency with signature when the highest producing agents in the province wanted Dual Agency to end. Of course now the Single Agent Dual Agent Brokerage scam is being promoted as a new definition to what decades of agency law had previously defined.

    We appreciate RECO dropping the words Professional from your home page and replacing it with the REBBA compliant sales representative or broker but the time has come to bring Associations under the oversight of RECO too.

    OREA and TREB should not be allowed to present false, misleading and inaccurate housing market information to the public by using paid non-registrant staff to avoid prosecution. The time has come for Boards of Directors to be held liable under REBBA for any housing market commentary coming out of their Association.

    Professionalism is defined by years of dedication to a craft not by taking a course and selling one home a year. How about a Tiered Trading License where if a sales rep maintains 12 sales in the last 12 months they are fully licensed to interact with the public alone. Under 12 they are a sub-licensee requiring the mentorship of the full 12 sale a year licensee. Think one sale a month is too much don’t worry you can be sure you can find 15,000 sales reps licensed in Ontario to take those spots. imagine the quality of service and professionalism dropping licenses to 15,000 would bring.

    PRECs really who are you kidding. The Median Sales rep does not sell one home in a year in Ontario. Hey if you want to allow the American Franchisors to bypass Risk by shifting it to ill-informed Canadians go ahead.

    It was nice to see the REALTOR trademark dropped from the legislation too bad CREA and OREA did not defend the trademark and ask it to be removed. The fact RECO did not inform the government the word REALTOR means nothing under the act and that REALTOR now means FSBO mere posters, really needs to exposed on the next marketplace story by CBC.

    Look, the public needs highly skilled, knowledgeable and ethical experts to assist them in the largest 25 financial commitment anyone makes. The public deserves Single Agency Brokerages not the outdated Dual Agency compromise the American Franchise Brands demand. I mean it has been 25 years and Undisclosed Dual Agency is bigger today than it was in 2002.

    Electronic storage???? really….open the coffin and smell the coffee. PIPEDIA has dictated the terms and condition for real estate brokerages since it launch not RECO! It’s the consumer who needs their personal data protected from Russian hackers and RECO can make any rules it wants too because PIPEDIA does not care what you say.

    It was nice stumbling upon this post. I can see the fear licensees still have attaching their names to anything RECO can see. Sure 80% of OREA members will hate the truth displayed above because they would be out of jobs. Sure the franchises which are built to strip starving agents of every last cent they can pull from them won’t like the thought of Consumers only being able to deal with Pros not wannabes.

    Actually if You Joe really cares about the consumer and the practice of professional real estate sales I encourage you to reach out to Carolyne who helped build the buyer broker business in Ontario when registrars enforced the act with an iron hand not waiting for a complaint that never comes. Ask the editor for her contact details because I can promise her knowledge in the business would wipe the floor of your entire board of directors combined times 10.

    • Nelson DeHoey

      I reference to your last paragraph in your comment:
      Thank you for your vote of confidence, once again. Totally unnecessary but duly appreciate your kindness. Readers should know we have never had the opportunity to meet personally, or work together, but it is abundantly clear you take your own position in the field, seriously. We need more of you. Perhaps in this new world order, the printer could create a clone.

      Your kind words are appreciated.
      But I have noted on REM more than once, that in the mid 90’s when buyer brokerage was foisted upon our trading area, it seemed to pop out of the air with much consternation.
      (Cambridge consternation definition: 1. a feeling of worry, shock, or confusion: 2. a feeling of strong annoyance and …)

      And I was one who was so not impressed. Of course what did I know? Obviously not much even after attending mandatory classes as well as elective ones. And since I had largely been a listing agent, and had a history of gigantic numbers of double-ended transactions, mistakenly thinking, along with my sellers, that I had been hired “to sell their house.” Not hired to use their house as a marketing tool by which to acquire other listings or buyers who would buy other listings instead. Does anyone have to wonder why the public and even the press, is confused?

      Not just forms required changing in the mid 90s, but Board Rules, too. Seemingly for ever, boards dictated how much agents would be paid, subject to office in-house laws and rules. But, what was mostly required? “attitude change.”

      And for those who didn’t make any concerted effort to read or especially attend their own office meetings, where some broker owners simply added more confusion to the mix, it was simply business as usual (meaning: We will continue to do business as usual.) All this “buyer brokerage stuff” will eventually just flitter away. Didn’t happen. And nearly twenty-five years later even some real estate lawyers “don’t get it.” Whose job was it to let them know what had become the new norm.

      I confess. I’m such a creature of habit, even more so in older years, constant change due to the world we now live in can get tiresome. The young people can’t keep up with the constant changes because they either aren’t old enough to have collected general business acumen under their belts, or have a laissez-faire attitude in some cases, having unrealistic expectations in the real world marketplace, and the older people sometimes are not tech savvy and don’t want to be. I am one who follows directions really well, but I have to have good directions. And I don’t want to learn how to “build” a computer or write code.

      A couple of generations will yet have to pass away before what we learned and practised routinely will have long gone the way of the high button boot. The old is still hovering in the shadows begging to be revived.

      I don’t want to misquote so I will try to be careful… I think I read in Ross’ book that in buyer brokerage he wrote that he mostly agreed just to accept whatever the commission offered was, as stated on a listing. I cringed when I read that, if I had read it right. It brought back a specific story I’ve shared before in REM.

      Big WHOOPS! There was a situation at a local brokerage early into the new systems where, who as a buyer rep, got paid ONLY the one-dollar as offered on the listing, and could not get paid a dollar more by anyone involved. Whoever the buyer agent was, himself, had agreed to being paid the one dollar as offered, in plain English in his buyer contract.

      Some brokerage offices had fill-in work at the ready when staff wasn’t busy. They would write in, pre-fill, as part of their work load, stating on the supplied pre-printed, government approved, buyer broker contracts that the buyer agent would accept whatever was offered on the listing [paid: as per listing contract].

      As the story went, both brokers knew each other well, and often reps at each office sold the other company’s listings. The brokers talked. The agents talked. Quasi threats were made, in the order of – (We’ll never sell your office listings again. C’mon, pay us what you’ve always paid us: half the commission – as dictated by the Board rules; you’re a reasonable fellow; we want to continue to do business with you. You don’t want to break our relationship do you, over this silly buyer broker contract “thing, do you?”)

      But there was nothing could be done. The “agreement” had already been made. Signed, sealed and delivered, so to speak. The stage was set for opening night; the dinner table was set, ready to eat.

      All what happened, simply put – “followed the contract,” just the way it was supposed to happen. The outcome was predicable. No one could sue anyone. The agent got paid what his office had set him up to be paid. One dollar.

      The buyer agent bringing the offer on the listing had set himself up by noting on the contract that he would accept whatever was offered on the listing (thinking old Board rules still applied, whatever house his buyer would choose.

      I knew one of the broker owners quite well in a business way. And he was a very honourable decent fellow. But as the listing broker his hands were tied.

      In real estate every procedure “follows the contract.” Problem… Look to the contract. Disagreement… Look to the contract. We must let the contract speak for itself I had been taught. And it does. Regardless of discussions of any and all sorts.

      I learned a valuable lesson from my broker colleague’s experience, as we all entered the new concept called buyer brokerage, as related to helping the public in the selling and buying of real estate, and was surely glad he shared that information.

      Of course his next office meeting discussed the story. And if I remember correctly those pre-filled in contracts were no longer used at that office. But many other offices had not heard that story.

      I was a creature of sub-agency. And practiced its “carefulness not to disclose,” religiously. By the mid-90s advent of buyer brokerage I was fifteen years in the real estate field. And do much still to learn. But since buyer brokerage was created by some genius apparently in the Ministry, we had to abide by the new rules. But what were the new rules, exactly. They seemed to be in permanent motion – for the next nearly twenty-five years. And after all these years that initial plan still hasn’t changed. Keep changing the rules. Agents talk about being a buyer agent/rep but their behaviour speaks otherwise in many cases.

      But back to grade one level understanding. It’s not about the commission (although of course everyone needs to be paid for their work – quantum meruit, anyone?) [one such google definition – for those not familiar with the term: Quantum meruit is a Latin phrase meaning “what one has earned”. In the context of contract law, it means something along the lines of “reasonable value of services”. ] We don’t get paid the way the plumber does or how the funeral director does – work for hire. Ours is such an unusual business. It stands on its own two legs, like no other.

      One could always say: let common sense prevail. But we know that, by definition, means different things to different folks. You can’t go wrong if you “look to the contract.” But of course you must understand its construct. And acknowledge who created it, who agreed to it, and who signed it. And in our industry we are not “party to the contract,” unless we are doing personal business of course. Agents often don’t understand that means we don’t get to have “an opinion, as such.” We can guide and facilitate, but we cannot make decisions for those who are, in fact, party to the contact.

      A reminder: for personal family and health-related reasons I sadly put my licence on hold. Subsequently I had a congestive heart failure heart attack, and later was told technically, clinically speaking I was dead upon arrival of the ambulance delivering me to hospital. I later that day learned the surgeon had told the nurse: if she has any family best they be contacted; we can’t save her.”

      Six days later, having spent 5 days in CCU, and one day in a semi-private room with a mental patient who said: if I had a knife I would slit your throat, I asked the cardiologist to discharge me immediately. Our health system is badly broken. They had no place to put the mental patient who tried to pull down the curtain separating the two beds areas.

      I walked out of the hospital on my own two legs an hour later, fully discharged, very weak, but no home care as promised, provided. They forgot, and it couldn’t be arranged after the fact.

      Aside from I tire easily, the recent medical report says that the upper left quadrant of my heart (that was completely destroyed according to hospital records, by their definition: a massive heart attack brought on my blood clots), had 99.9% completely healed.

      But my corporation still stands cogent, and although I can’t practice as such, I sometimes get calls from agents asking for advice (wondering where is their own broker or owner). I still value those connections but can only speak off the record.

      When I first opened my own boutique real estate company in 1991, a full decade of industry behind me, at the time an unheard of concept in our trading area, I was doomed to fail. On all my printed corporate stationery, even letterhead matching envelopes, you could read: “Thanks for your continued support …” (complete with ellipsis – meaning more to come). I say that, here, now.

      Perhaps our Manitoba REM colleague article writer might say, perhaps God isn’t finished with me yet. Only time will tell. No one is promised tomorrow. In the meantime I continue to write my original recipes, and re-creating some of the old ones from the mid 1970’s.

      Maybe copies of my copyright protected real estate related consumer education articles on my corporate personalized name domain website would make a useful ebook.

      Maybe something for me to think about as an additional way of sharing. The site has not been updated but the articles, for anyone interested, are still active at: http://www.carolyne.com/bramptonhomes/index.html

      Respectfully,
      Carolyne L 🍁

      • “My” buyer brokerage developed in the mid 1990s, as I’ve noted previously at REM, required a buyer to be prequalified (see my post at Tim’s REM comment):
        https://www.remonline.com/dont-let-these-buyers-waste-your-time/

        Buyer must provide proof of being qualified to purchase at his intended buying price, before I will accept a buyer broker contract agreeing to “represent” the buyer.

        I would agree to a one-time showing following a meeting that sometimes took a couple of hours, of 2-3 houses I had chosen based on the buyer’s wants and needs list, so as we each could evaluate whether or not we could/would be of such personality matches as to be able to work together, and how close the houses matched the so-called requirements.

        Either the representation contract got signed or it didn’t. I chose whether or not to spend my valuable time with the applicants. I only ever had one nearly negative issue to deal with.

        I only ever had one who wanted my representation but didn’t want to be tied down to my contract and that it stipulated the percentage I required, over and above what a listing contract might offer.

        He was getting boatloads of advice from other reps, telling him there was no rule governing the situation, saying that he must sign a buyer representation contract. And they advised him against signing a buyer representation contract. Those agents never asked for a contract. But they never fulfilled his needs, either.

        Other agents had him on mailing lists providing daily new listings information from which he could select what he wanted to see. He was working with several agents for more than a year, including the one he had bought his current place from a few years prior, I learned later.

        No one could seem to find him the right house to buy, although he chose many to look at, wasting seller’s time as well as agent time. It wasn’t that he wanted to waste his time or the time of others. He was indeed a serious buyer. But he had totally unrealistic expectations and a wants and needs list nearly impossible to fulfill. Such simply didn’t exist. And certainly not in the price range he had chosen. I’ve referred to this perfect example at other times in buyer agent related topics.

        An agent who would be successful would need to know more than just about real estate contracts. They’d need to know, for example, the lay of the land, so to speak, in various locations within the city, that would have permitted his requirements even to have been built, accommodated by a builder.

        His list included priorities such as must have a long driveway, a cul de sac location, on a ravine walkout basement lot, with a well-designed useful finished lower level. Also plenty of lower level storage space. (Often well-done finished basements forget to include storage space.)
        A main floor laundry room was needed with a separate side entrance. A substantial size entrance foyer, with circular stairs, a separate livingroom-diningroom, a generous eat-in kitchen with pantry cupboard wall. And of course, ideally a large master bedroom with generous closets and a large complete ensuite bathroom with shower and tub.

        First problem: most cul de sac properties do not have long driveways, and guest street parking is often an issue. There often isn’t any.

        The natural lay of the land rarely accommodates a long driveway on a ravine lot in our city. There weren’t a half dozen sites as such in the whole town. And none currently for sale. They rarely came on the market for sale and in any kind of market sold almost overnight, often at high prices.

        But he didn’t believe he needed an agent dedicated to him, agent under contract, much less having to top up the commission offered on a listing. So, even so they were very nice people, I was prepared to not get further involved.

        Although he finally decided I should be his chosen contracted rep, he still was taking guidance from outside sources.

        Not only did I find him the perfect property at a perfect price point, he had agreed to top up the commission. But later I learned he had clearly disapproved; but he (they) had signed the buyer contract that clearly stated and spelled things out in plain English.

        He had attended at his closing lawyer’s office and all adjustments were tallied and accounted for. He would deliver a separate certified cheque to the law office for my invoice (to and through the law office). But by closing he didn’t.

        He was notified that the transaction was closed. To bring his extra cheque and collect keys to his new home. He attended but had forgot his chequebook. The law office refused keys. He came back (only lived ten minutes away), with cheque in hand. I was never quite sure what that was all about. Three guesses and the first two don’t count. A teacher at a local school and wife who worked a government contract job. They really were pleasant to work for, actually, once the guidelines were carved in stone. I never pushed them. But I simply was firm about how I did business.

        By the way, I listed their existing house, and it sold MLS.

        And I didn’t learn about the missing cheque situation for a few days when I was notified by the law office to collect my (differential) cheque, as per my invoice to his buyer law office, along with my commission cheque for the sale of his existing house (at 6 points), from which I had a cheque waiting at my office to hand-deliver to the MLS selling office.

        You can read their thank-you letter posted on my site, where he added a personal thank you to me for how much money I put in his “equity-pocket”), at: “Carolyne’s Clients Speak.” (Scroll down.)
        http://www.carolyne.com/awards.html#speaks

        I didn’t lose a bit of sleep during the transaction because I knew I had treated them well and professionally and had earned every dollar of the commission. It’s kind of like knowing that a lug nut might only cost a few cents but you need to know where to install it story and charge a hundred dollars for a service call.

        I learned to love buyer brokerage. But the process had to be done my way or not at all. The bulk of my business remained acting for sellers; but then they in turn became my buyers (but still required a separate buyer contract). I had heard too many colleague horror stories. Thankful that I didn’t have any. Why? Because I always had my contract in hand. And always got wonderful thank you letters. The ones on my site are only a few, and with each I added a little explanation.

        Carolyne L 🍁

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