Beginning April 1, 2023, changes are coming to real estate. Reforms to current laws are being implemented to further protect consumers.
RECO (Real Estate Council of Ontario), the institution that enforces real estate rules in the province of Ontario, announced improvements today designed to “strengthen consumer protection and raise consumer confidence in the real estate sector.” (RECO, 2022).
According to RECO (2022), the following changes will take effect beginning April 1, 2023:
- The Real Estate and Business Brokers Act, 2002 (REBBA) will be renamed the Trust in Real Estate Services Act, 2002(TRESA, 2002).
- Code of Ethics - a new principle-based code of ethics will be introduced that will take the place of the existing code. Note that real estate professionals are already held to specific standards in the current code of conduct, however it is expected that the new code will see several changes.
- Enhanced Disclosures – written in plain language and prominently identified as “disclosure,” along with other information, will help buyers and sellers to make informed decisions. For example, there will be greater clarity about the obligations for the seller’s brokerage to disclose material facts to buyers.
- How Consumers Work with Real Estate Brokerages – including adding clarity around the options available to them. This will include information to help consumers decide which option they prefer and the implications of each. For example, greater clarity will be provided communicating what happens if a buyer and seller are represented by the same brokerage.
- Representation by a Brokerage - for those who choose not to be represented by a registrant in a trade, there will be a new RECO form to help explain the risks involved and what they can expect from a brokerage in that scenario.
- Introduction of Open Offer Process - sellers will have the option to use an open-offer process to sell their property, while maintaining the confidentiality of those making the offers. In the current seller's market we have seen a lot of underpricing leading to multiple offers, however the way it's done today is all blind bidding. Buyers will be told how many other buyers are competing for the same home, but the contents of those offers are kept confidential.
- Consumer Information Guide - every buyer and seller who engages with a real estate professional will be given an information guide that outlines key information everyone should know. The guide will be produced by RECO.
Remember, too, that there are real estate professionals working today that strive to provide these same exceptional levels of service - but without the mandate to do so. Get in touch with us today to find out more about our data-driven guidance and outstanding client support.
It is expected that the changes announced today will strengthen consumer protection and help RECO with its compliance and enforcement efforts (RECO, 2022).
For more information on the specifics of what’s coming, you can visit the Ontario e-Laws Website.
RECO (2022). Government announces key changes to REBBA effective next year.
Queen’s Printer for Ontario (2022). Real Estate and Business Brokers Act, 2002, S.O. 2002, c. 30, Sched.