In light of recent changes in the B.C. real estate market, the Real Estate Council of Ontario was put to the test. It passed with flying colours.
The much-publicized growth in the British Columbia real estate market has led to a swift movement by the B.C. government, removing controls of the real estate industry there to self-govern & placing oversight in the hands of the provincial parliament. In doing so, B.C. cast a spotlight upon the Real Estate Council of Ontario, and perhaps TREB (The Toronto Real Estate Board) in particular. The question being: If sizable growth in B.C. can be, in part, attributed to misconduct by real estate industry players, does Ontario’s current governing body still have the means & morality to steer the ship?
In the eyes of the Ontario government, it’s a resounding “yes”.
With no planned changes to the governing model, recent statements from the Ontario government can be seen as a testament to the integrity and stability of the real estate tradespeople in our province. The comfort with the Real Estate Council of Ontario’s current operations likely stems from a variety of places, but there are two factors I point to when discussing why RECO is so effective.
Firstly, directors & disciplinary panelists come from both within and outside the real estate industry. This limits the favouritism and protectionism that can fester within close-knit industries such as this. It makes punishments & disciplinary decisions fair & equitable, ensuring the punishments fit the crimes where they’ve occurred.
Secondly, RECO is progressive and dynamic, ensuring that standards & upheld, and even instituted ahead of their time. For example, among a list of suggested changes to the B.C. industry’s regulatory processes, about two-thirds were already implemented voluntarily within Ontario. RECO’s inherent desire to protect consumers and the integrity of the industry among its members shines through in that regard.
For more valuable insight into the strengths of the Real Estate Council of Ontario, and how they compare to the challenges faced out west, I’d recommend the bulk of Mike Hager’s article from last week’s Globe & Mail, below.
Unlike British Columbia, Ontario real estate to stay self-regulated
Mike Hager, Globe & Mail, Vancouver, July 01 2016
Ontario has no plans to change how Canada’s second-hottest real estate market is governed, with its self-regulating body arguing it already has many of the safeguards that have been missing in British Columbia, where the industry has just lost the right to police itself.
Real estate agents in Ontario are licensed, investigated and disciplined by an agency run by their peers: the Real Estate Council of Ontario.
B.C. Premier Christy Clark announced this week that her government is taking back control of the industry, removing the Real Estate Council of British Columbia’s ability to regulate agents and brokerages. The province had been under pressure to act since a series of Globe investigations found the province’s regulator failed to protect home buyers and sellers from unethical realtors.
Marie-France Lalonde, Ontario’s Minister of Government and Consumer Services, said the province has no plans to change the role of the real estate council, whose jurisdiction includes Toronto, where the frothy housing market is also raising concerns about speculation, soaring prices and the possible realtor misconduct that comes with such conditions.
“We recognize the significant and effective role that the Real Estate Council of Ontario plays in regulating Ontario’s busy real estate industry and in enhancing consumer protection,” Ms. Lalonde said in an e-mailed statement. “Our government is not considering changes to Ontario’s real estate regulation model at this time.”
British Columbia’s overhaul came after an independent panel called for widespread change within the industry, concluding the Real Estate Council of B.C. is dominated by industry members who took disciplinary action reluctantly and tentatively.
While the panel did not recommend ending self-regulation, as that larger issue was outside its mandate, it did raise concerns about the role of real estate boards and trade associations. The boards have their own parallel – and private – discipline process.
The panel said the province’s 11 local real estate boards should relinquish this “quasi-regulatory” role, because they wield too much power in policing realtors, and the two separate tracks for complaints cause too much confusion for consumers. (In its 2015 annual report, a council survey of real estate clients found only 30 per cent of respondents knew how to file a complaint with the regulator.)
The Real Estate Council of B.C. currently includes 17 members, three of which come from outside the industry. The panel recommended it be split evenly between the industry and outside. The B.C. government has promised to go further, with a majority of non-industry members.
Three of the Ontario council’s 12 directors come from outside the industry.
The registrar of the Ontario council, Joe Richer, said his self-regulating body made many of the changes recommended in British Columbia long ago. That includes taking over any complaint from a member of the public regarding a realtor from the province’s more than 40 local real estate boards, he said. “What’s happening in B.C. really is very very similar to what happened to Ontario in the mid-1990s,” Mr. Richer said. “I’m pleased [that], by my tally, at least two-thirds of [the improvements B.C. is committing to] Ontario is already doing in whole, or in part.”
Dan Morrison, president of the Real Estate Board of Greater Vancouver, said his private association is eager to help the province make the “progressive” changes, including creating just one track for consumer complaints.
“We’re happy not to get those phone calls,” said Mr. Morrison, whose board grants access to the MLS listings system for 12,800 of the region’s realtors. “The [thousands of agents] in Greater Vancouver were unfairly tarred with a negative brush this week because of the actions of a few who allegedly failed to act in the best interests of their clients.”
Earlier this year, the Greater Vancouver board voted to increase its maximum fines to $30,000, but its disciplinary decisions are kept secret, even from those who submitted the complaints.
British Columbia’s finance ministry is working to implement the 28 recommendations from the independent panel, foremost of which is creating a new, expanded office of the Superintendent of Real Estate and hiring a replacement for the current superintendent, Carolyn Rogers, who is leaving for a new job in Ottawa regulating the banking sector.
In the meantime, consumers such as Sukhjit Bassi of Richmond, B.C., are wondering what will happen to complaints they made to the real estate council. Mr. Bassi filed a complaint two months ago alleging one of New Coast Realty’s top realtors deceived him, selling his house for less than market value to a speculator with whom she had arranged deals before. “I don’t mind my complaint just getting closed and nothing happens, as long as these guys are now regulated properly,” Mr. Bassi said.