Real Estate News
Ontario Gets New Real Estate Law in March
Government regulation of real estate is a hot topic these days. In the United States, several states have tangled with the federal government about regulatory practices, and the Department of Justice is suing the National Association of Realtors over the association"s Internet listings policies. In Canada, a group of real estate regulators has made recommendations to the industry about how the issue of "agency" should be handled. Agency refers to who the real estate practitioner represents in a transaction. British Columbia has been getting used to its new Real Estate Services Act, which became law at the beginning of the year. Now, after years of study and consultation, Ontario"s new Real Estate Business Brokers Act will come into force in March. Most of the proposals for this legislation were originally introduced in 2001, but work on the regulations governing the province"s real estate community has been going on much longer. "Real estate in Ontario has been regulated since the 1930s," says Tom Wright, the president and CEO of the Real Estate Council of Ontario (RECO). Speaking to a group of mortgage brokers recently, Wright said that over the years, "despite the best efforts of real estate boards and associations" to set standards to govern the industry, "enforcement by professional associations, regardless of how professional they seem to be, often are seen to be in the best interests of the industry." He said, "Public perception of the profession addressing complaints against their own members is not always favourable." RECO now administers the Real Estate and Business Brokers Act on behalf of the government, including licensing and disciplinary measures. The goal of the new Ontario act is improved consumer protection. While the mantra for buying real estate may be location, location, location, the key message of the legislation for real estate professionals is disclose, disclose, disclose. When clients are providing money that is to be placed in trust funds, the brokerage must disclose the terms on which the brokerage deposits the money, including interest that it receives on the money. That interest must stay with the deposit unless agreed upon in the contract, and must be paid to the owner of the trust money. A Code of Ethics that forms part of the new act does not allow an agent to represent more than one client in a real estate transaction unless all of the clients involved have consented in writing. Provisions that deal with false or misleading advertising have been beefed up. RECO will be able to order advertising to be withdrawn, and can order sales reps to publish corrections or retractions. RECO can also demand to pre-approve a real estate practitioner"s advertisements for up to a year, if they are found in violation of the act. Salespeople can be prosecuted for false advertising. The maximum fines for those who violate the act have doubled for individuals, from $25,000 to $50,000. For corporations, maximum fines have risen from $100,000 to $250,000. Under the current act, real estate practitioners can continue to sell real estate even if RECO is in the process of terminating their license, or if they are appealing the decision. Under the new act, an immediate suspension can be ordered if RECO believes it is in the public interest to do so. RECO says that the new act will also result in more information being made available to the public about those who have real estate licenses. For example, if RECO is considering a proposal to revoke, suspend or apply conditions, but a decision has not yet been made, that information will be posed on the RECO website. RECO will also publish information about false advertising, freeze orders and all charges and convictions made under the act. Beginning in March, there will be a new complaints process for those who have a problem with a real estate practitioner. All complaints will be handled by RECO"s Office of the Registrar. Wright says the new complaints process is "clear and transparent," and that the new act is "fair and responsive to the needs of consumers and real estate practitioners." He says that with the new regulations in place, he"s sure that "the public perception of the real estate industry will continue to improve."RES Course Provider commented:
You have shared really valuabkle points regarding Government regulation of real estate. Real estate industry may get good growth if this law is applied on it.
05.04.2012