Ontario realtors are calling for new regulations to modernize consumer protections and close industry gaps
The Ontario Real Estate Association (OREA) has issued a whitepaper urging the Ontario government to adopt nine key policy recommendations in the final phase of the Trust in Real Estate Services Act (TRESA) implementation.
This latest phase aims to enhance professional standards, increase consumer protections, and address outdated laws and loopholes within the real estate sector in Ontario.
The whitepaper, titled Continuing to Raise the Bar for Real Estate in Ontario, includes recommendations that would modernize Ontario’s real estate regulations to ensure transparency, improve agent training, and discourage unethical practices.
Prioritizing transparency
One significant recommendation addresses what OREA described as the "auctioneer exemption loophole." This loophole allows auctioneers to facilitate real estate sales without following the same rules as licensed agents.
OREA wants auctioneers brought under the oversight of the Real Estate Council of Ontario (RECO), the body regulating real estate agents, to ensure that all property transactions meet the same ethical and professional standards.
“We need to eliminate this two-tiered system of consumer protection,” said Rick Kedzior, OREA’s 2024 president, “ensuring all real estate transactions adhere to the same standards and oversight.”
To support informed decisions, OREA also advocated for mandatory disclosure of latent defects, hidden issues like a cracked foundation, that can become costly surprises for buyers. Sellers would need to reveal these details to ensure buyers understand a property’s true condition, a practice currently upheld in places like New York and Quebec.
To prevent confusion in guaranteed sales programs, where agents agree to purchase a home if it doesn’t sell, OREA proposes clearer disclosure rules so sellers fully understand all terms. This would protect consumers from unexpected fees or conditions that might impact their final payout if the guaranteed sale is triggered.
Stronger workforce
OREA’s recommendations include a two-year mentorship and articling requirement for new agents. This hands-on training would offer new agents the chance to gain practical skills, addressing concerns that the current educational requirements leave many unprepared for real-world demands.
According to a recent survey, two-thirds of Ontario REALTORS® believe the existing training lacks practical components essential to a successful start in the field.
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In addition, OREA is advocating for specialty certifications that would allow agents to market themselves as experts in areas such as commercial, agricultural, and recreational properties. This would place Ontario alongside other Canadian provinces that recognize and promote such specializations, enhancing consumer confidence by allowing buyers and sellers to work with agents who have specific knowledge in specialized property types.
Tougher penalties
The whitepaper also calls for administrative penalties for minor infractions, enabling RECO to focus its disciplinary efforts on serious cases. For example, an agent could face a fine for a straightforward advertising violation rather than undergoing a lengthy review process, allowing RECO to allocate more resources to cases of significant misconduct.
In cases of major violations, such as breaches of ethics, OREA suggested a “disgorgement” policy, where offending agents could be required to return profits from unethical activities to affected consumers. This proposed policy aligns with similar practices in securities regulation, underscoring the seriousness of protecting consumers from financial harm.
Additionally, the association proposed an extended cooling-off period of nearly two years for agents whose registrations have been revoked due to serious breaches, arguing that the current one-year period is insufficient.
“By implementing OREA’s nine bold policy proposals, the Government of Ontario has the opportunity to continue to lead in professional standards and consumer protections, strengthening Ontario real estate for generations to come,” Kedzior said in a media release.
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