Canada's Condominium Magazine
Fines for misconduct of Realtors may soon increase — in a move designed to reassure both buyers and sellers in Ontario. Although the incidence of unethical behaviour is low — the Real Estate Council of Ontario collected only $304,500 in fines in 2016 — all stakeholders are pushing for reform to the Real Estate and Business Brokers Act.
As part of a review of practices, OREA is pushing for two areas of reform to the Real Estate and Business Brokers Act (REBBA): dramatically increased fines for enforcement; and guidelines that will eliminate “double ending” a deal. (Double ending, as in representing both seller and buyer in a transaction.) The Ontario government is pushing hard on ending this practice.
The current fines from the Real Estate Council of Ontario — who regulate the industry — are less than $6,000, but were set when the average home value was almost a third of the current average. OREA is pushing for at least doubling the fines. For some penalties, brokerages and brokers could see fines of nearly $100,000, while salespeople would cap around $50,000. In addition, realtors may have to additional give up any profits earned illicitly, or from breaking the rules.
According to OREA, in 2016:
- the average fine for realtors in violation of ethics was $5,856
- Real Estate Council of Ontario collected $304,500 in fines total
- 2,529 complaints were received, and 2,218 of these were closed.
As part of the review of REBBA, OREA is consulting with its members and issuing “discussion” white papers as they go. Members — over 70,000 strong — are then invited to provide feedback. The whitepaper on fines was only the first of four due before the end of 2017.
Orea REBBA Reform Video:
Realtors may also be forced to give up their registrations. Currently, registered realtors pay a $390 annual fee to RECO and another $110 to OREA. Every two years, agents must take a $44 online program.