TORONTO – The Ontario Real Estate Association is seeking feedback on whether it should push the provincial government into modernizing the real estate industry to make it more transparent.
In a white paper released Thursday, OREA said the current sales system creates “suspicion and mistrust” by forcing prospective buyers to “blind bid” because realtors cannot disclose the contents of an offer to anyone other than the seller.
“The unsuccessful buyers often feel they didn’t have a fair chance and could have bid higher if they had known what they were up against,” said OREA, in its white paper. “The winning buyer may feel they ‘overpaid’ because they were the successful offer.”
OREA’s president Ettore Cardarelli said whatever feedback OREA collects will inform the final policy proposals its board sends to the provincial government, which agreed to a review of the Real Estate and Business Brokers Act in April 2017.
While Cardarelli stressed OREA is not taking an official position on the issue, he said many buyers in favour of bringing more transparency to the bid system lost out on a home purchase and want access to what others offered, so it can inform their future bids or reveal how much they lost out by.
He said more transparency on the issue “won’t necessarily guarantee you the sale,” but makes people “feel better that they lost out in a more open process.”
Christopher Alexander, the EVP and regional director at RE/MAX, applauded OREA for debating changes to bidding, but said “it will be hard for there to be a win-win situation for buyers and sellers.”
“Someone is going to lose out,” he said. “If everyone knows what each other is bidding then sellers might feel like they lost out on some money. However, if (the system) continues the way it is, buyers often feel like they overpaid, or had they known, they would have paid more.”
Aside from ways to create more transparency in the bid system, OREA is asking members to weigh in on a broad set of issues, including whether agents should be fined for not showing up to viewings and not offering timely or reasonable explanations for the cancellations, whether term limits for buyer and seller contracts or early termination provisions for clients should be instituted, and whether OREA members should be issued photo identification cards to offer more security to viewings.
It is also looking into ways the province can boost trust in realtors, by seeking advice on whether they should automatically deny registration to realtor applicants with violent or fraudulent criminal convictions within the last 10 years, force applicants with a previously revoked registration to wait two years before reapplying and expand its definition of the trade to account for the “growing” number of people calling themselves “housing consultants,” while completing transactions and often targeting new Canadians.
OREA has been advocating for a review of the act since last fall because it says the act was introduced 15 years ago and since then “times have changed.”
A final report on the act from a provincial task force is expected to be released in September.