Canada's Condominium Magazine
The association that represents realtors at the provincial level in Ontario appears to be facing an existential moment of truth. For decades, the Ontario Real Estate Association (OREA) Real Estate College has been authorised by the Real Estate Council of Ontario (RECO) to provide realtor education in the province, but that could be ending. RECO has reportedly decided to end its contract with the college as of 2020. Since that arrangement accounts for two-thirds of OREA’s annual revenue, $38 million in 2015, losing it would be a major blow to the organisation.
Even before this potential crisis emerged, the organisation was engaged in some serious soul searching. Last year OREA commissioned a comprehensive “no holds barred” study of its governance structure, after concluding that current practices “aren’t working for us.” Many members are critical of their lack of efficiency and transparency, even questioning the relevance of the provincial body. The report, from Watson Advisory, found that the need for governance change was “high,” the loss of the RECO contract being just one of the challenges facing OREA.
The Watson governance report is influenced by a number of broader “guiding principles” that will inform future activities at OREA. These include focusing on the needs of OREA’s members, ensuring that their voices are heard, being open and transparent in decision making, and making decisions based on high-quality, objective information.
The composition, training and experience of the members of OREA’s board of directors emerged as a key issue among members. Many feel that the board as currently constituted is too large and cumbersome, with too many committees. A smaller board would be more efficient, more “agile” in decision making, and it would be easier to find enough qualified members for a smaller board. According to the report, many realtors are not satisfied that the OREA board of directors is of high enough quality to do the job.
Transparency and financial management were also highlighted. The OREA assembly, a sort of annual general meeting whose need is now being questioned, approved a levy of $30 on every member to fund an ad campaign promoting the value of realtors to consumers. The Toronto Real Estate Board challenged the move and the resulting “tensions” were a major impetus for the review.
Over the last year, OREA has undertaken a comprehensive and ‘no holds barred’ review of its current governance structure. We enlisted the help of one of Canada’s leading governance experts, WATSON Advisors Inc., and with their help, we took a good, hard look at ourselves, through the eyes of our leaders, our key stakeholders, and our individual members. As the review was being completed, it became clear that our current governance structure and practices aren’t working for us. The perception by our members is one of inefficiency, waste and a lack of transparency.
Even the need for a provincial real estate board has been questioned, when there are forty local boards in the province, and a national board, the Canadian Real Estate Association.
OREA’s position is that it is the voice of realtors at Queens Park, and points to the success of its advocacy efforts. It takes credit, for example, for stopping the municipal land transfer tax from spreading from Toronto to other parts of the province when that seemed imminent last year. Some municipalities, Mississauga among them, wanted the same right as Toronto had been given, seeing a land transfer tax as a very lucrative revenue generating tool.
However, OREA launched a public awareness campaign in 2016, Don’t Tax My Dreams, which targeted Ontario MPPs with the message that a land transfer tax only made home ownership less affordable and should be stopped. The provincial government announced in December that it would not give other municipalities the right to impose the tax, and OREA claimed victory.
Another issue it advocated for was the use of electronic signatures in real estate transactions. The government amended the Electronic Commerce Act in 2015 to allow electronic signatures on agreements of purchase and sale, which had previously been excluded. This was a “huge victory” for realtors and consumers, OREA said, as they can now conclude transactions faster and more conveniently.
A number of proposed changes to the way OREA operates are now on the table following the release of the Watson report. The 63,000 brokers and sales representatives from across the province will have the chance to vote on the them at the upcoming annual conference in Toronto, taking place February 27–March 1.