By Toronto Real Estate Board
In a meeting with the Ministry of Government and Consumer Services, the Toronto Real Estate Board (TREB) demonstrated its commitment to consumer protection and efficiency for real estate transactions. TREB met with Ministry officials to provide input on their ongoing consultations regarding potential changes to the Real Estate and Business Brokers Act.
“TREB is happy to work with the Province to ensure that the rules governing the real estate industry are modernized and adjusted to ensure consumer protection and an efficient marketplace for real estate professionals and the public,” said Tim Syrianos, President of the Toronto Real Estate Board. “We also believe that consumers deserve to be treated with fairness, honesty, and integrity when purchasing a home, often the biggest financial decision in most people’s lives.”
The provincial Ministry of Government and Consumer Services is currently reviewing the Real Estate and Business Brokers Act, 2002. Phase One of this review is focusing on issues associated with multiple representation situations, consumer understanding of real estate transaction agreements, and penalties for unethical behaviour.
“TREB supports, in principle, the proposal to move towards a mandatory designated representation model. This approach is consistent with numerous other Canadian jurisdictions, and we believe that it will allow for the efficient operation of the marketplace, while ensuring consumer protection,” said Syrianos.
Under Mandatory Designated Representation (MDR) that the government is proposing, where a circumstance arises that a buyer and seller are represented by the same real estate brokerage, the brokerage would be required to designate different representatives from that brokerage to represent each client. A salesperson/broker within a brokerage would be prohibited from representing both the buyer and the seller, or more than one buyer, in the same trade with limited exceptions such as a private arrangement between family members or there are a small number of registrants in areas serving a small market or community.
However, TREB is advocating that there should also be provisions (transactional representation) to allow for consumer choice in how and by whom they are represented when working with their brokerage and licensed representative. Transactional Representation will be an option when a representative is representing both a buyer and seller in the same potential transaction with their consent. Three options will be presented to the consumer: unrepresented; represented by another representative for that transaction; or Transactional Representation.
Transactional representation eliminates the ability for a representative to represent both clients by restricting the services they can offer to both a buyer and seller. If they consent, the representative becomes an impartial facilitator.
“The vast majority of TREB Members are ethical and comply with the Real Estate and Business Brokers Act. There should be a review for consistency in enforcement and disclosure of fines and penalties. Any actions in this area should be evidence-based. With this in mind, we look forward to continuing to work with the Province on all aspects of this and other important issues such as raising educational standards and requirements,” said Syrianos.