Tuesday, May 14, 2013

Laws Protect Us, Restrict & Sometimes Confuse Us

Contrary to what the public often perceive, REALTORS® across Canada are held accountable to a very high standard of conduct. Here in Ontario, REALTORS® are licensed under provincial law namely the Real Estate and Business Brokers Act (REBBA 2002).

During the past 12 years in addition to my own business, I have been actively involved in the behind the scenes aspect of organized real estate having held a number of positions with our local real estate Association including that of President (2008). This year I have expanded my participation in this regard as I currently sit on the committee at the Ontario Real Estate Association that reviews and make recommendations relative to the various Provincial forms, conditions and clauses etc. that are used in the listing and sale of properties.

In addition to REBBA 2002, the activities of REALTORS® also fall under the requirements of Canada’s Privacy Act adding restrictions that protect consumers further. Then there is the federal Competition Bureau. Some of the requirements these government bodies impose complement each other while other contradict each other.

Recently a REALTOR® was fined $5,000 and ordered to take an educational course when they failed to be present at a property during a home inspection that was being performed on behalf of a buyer. In their complaint to the Real Estate Council of Ontario, the Seller(s) was concerned (and rightly so) that a home inspector had been given access to their home via the lockbox code with no REALTOR® present. The REALTOR® was found to have not acted fairly and honestly, they failed to provide conscientious, competent service and lastly exhibited unprofessional conduct. There is no question that the homeowner’s complaint should have been upheld.

So here’s the rub. Our real estate Association investigated as to whether a requirement could be implemented within our MLS® rules making it mandatory for a REALTOR® to be present for a home inspection or for one by an insurance broker, real estate appraiser etc. The answer? No. The reason being it was deemed that such a rule could be viewed or construed as being anti-competitive.

In future postings I will share additional stories that impact consumers. In the meantime here are a couple of points you may not be aware of.

- As per the Privacy Act, REALTORS® are not allowed to call sellers whose listings have expired unless the seller(s) has provided written consent allowing it.

- As per the Privacy Act, buyers, home inspectors and appraisers etc. are not allowed to take photos of a seller’s home without their written consent.

- Did you know that as a customer, you are not owed the same fiduciary duties by a REALTOR® as you would as a client?  Legally there is a difference between the two distinctions.

Sometimes laws protect us, sometimes they restrict us and sometimes they just plain confuse us.

Wednesday, May 8, 2013

Area Real Estate Sales A Mixed Bag in 2013

Area real estate sales continue to reflect mixed results across the various areas of our region with stable being about the only adjective I can think of to describe the “overall” market.

  Following a very soft finish to 2012, MLS® sales volume in January reflected a 14% increase over January of last year. This was followed by a decrease in MLS® dollar volume in February of 7%, an increase of 3% in March with sales in April down 4% from April 2012.
 Year-to-date dollar volume is essentially
unchanged from one year ago with MLS®
sales totaling $179.2 million to the end of April, an increase of 1%.
  As I have said on previous occasions, our market consists of several micro-markets which makes it difficult to sum up overall market activity in one concise phrase. MLS® unit condominium sales to the end of April are up 6% whereas MLS® single family home sales
which total 396 properties are down 6%. We are seeing
steady sales activity in the under $200,000 price
range with sales up 4% as many first time buyers are
continuing to take advantage of the low interest rates.
Meanwhile sales above $1 million which total 7 sales
year-to-date are down 46% from one year ago when
13 MLS® sales have been reported.

The number of new MLS® listings hitting the market is down from the first four months of last year. To the end
of April there have been 2,268 new MLS® listings, a
 decrease of 5% from one year ago. At the same time,
expired listings have increased by 4% as many sellers
to take their properties off the market or have chosen to
rent them out until such time as they perceive market
conditions have improved allowing them to realize their
selling price expectations.

While sales in Collingwood and Wasaga Beach are
essentially equal to last year at this time, sales in the
Blue Mountains are up 8%. Conversely, MLS® sales
in Clearview Township, Grey Highlands and the
Municipality of Meaford are all showing year-to-date
 ranging from 6% to 32% below the first four months
of 2012.

The month of May has brought with it near summertime temperatures, we’ll see if the change in weather serves to
heat up the slower segments of our real estate market in
the months ahead.

Wednesday, May 1, 2013

Changes May Be Forthcoming to Ontario's Real Estate Industry

  Although it's not a significant problem in this market, phantom offers aimed at increasing the hype and subsequently the number of offers relative to a property are now said to be the focus of changes being considered by Ontario's Consumer Services Ministry according to a recent article in the Toronto Star.
  Also mentioned in article are further considerations by the Ministry that will provide consumers with easier access to a variety of unbundled real estate services now being offered by non-traditional real estate brokerages or service providers.
  At this point in time there is no formal means by which real estate brokerages are required by law to handle multiple offers, most brokerages however do have their own in-house policy in this regard to protect both their clients and themselves.  In the GTA, multiple offers on a highly desirable property are commonplace.  REALTORS® are obviously not allowed to disclose the terms of various offers to other REALTORS®, only the sellers are privy to the information contained in various offers.  It has happened however where a buyer submitted an offer on a property with the understanding there was more than one offer only to find out there was not. At times this may be an innocent situation where another buyer simply decided not to get into a bidding war and withdrew their offer.  There have been times however when a REALTOR® alleged there was another offer on a property in order to induce multiple offers and or to force other buyers to pay closer or even more than the asking price.  New legislation is in the works to prevent what Ontario’s Consumer Services Ministry sees as misleading and abusive practices in the marketplace.
  Another change being considered pertains to commissions.  At this point in time it is illegal for REALTORS® to charge a commission based on multiple facets ie: a set fee (dollar amount or percentage) plus a secondary fee in addition to the base amount.  Example: A flat fee of $2,500 plus a percentage commission of the sale price is not allowed.  This too may change under any pending new legislation.
  REALTORS® licensed in Ontario operate under strict guidelines stipulated in the Real Estate and Business Brokers Act 2002.  The Real Estate Council of Ontario enforces the act on behalf of the Provincial government and further imposes any penalties against REALTORS® that are deemed to have failed to meet the Act's requirements.
  Watch for further postings wherein I will keep you updated as to any changes that may get legislated in the future.  

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Royal LePAGE Locations North (Brokerage)

330 First Street, Collingwood, ON L9Y 1B4


Direct: 705-443-1037

Office: 705-445-5520 ext 230


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