To better empower and protect the consumer, it’s my belief that the real estate industry as a whole should consider change. Organized real estate boards can amend legislation at the provincial level to allow an even playing field for all licensed practitioners.
1 – Ban the listing agent’s name on all “for sale” signage
I’m sure this suggestion will not bode well with my colleagues, but it’s a must if we are going to be serious about consumer protection.
The general public must be aware that any contract signed – for example, a listing agreement, or a buyer representation agreement in the province of Ontario – is between the consumer and the brokerage that the sales rep’s license is registered with. The contract is not between consumer and sales rep.
So why are sales reps permitted to advertise their names? This gives a false perception to the general public! Further, it suggests that if a buyer would like to purchase the subject property, they are more inclined to contact the listing sales rep, which can cause a conflict of interest.
2 – Ban all third-party syndicated websites that promote listings
This one is a becoming a huge issue within our industry. Third party websites do not display current and accurate details and thus confuse the consumer. Also, these websites are not governed or regulated because they are not being hosted by a licensed brokerage or licensed sales rep.
I would like to see the Toronto Real Estate Board take more initiative in educating brokerages on the cons of allowing their content to be shared with these websites.
3 – RECO must do a better job of policing the industry
The Real Estate Council of Ontario is obligated by legislation to protect the consumer. The problem is the self-governing method is not as effective as taking a more initiative approach when dealing with unethical agents. Response times to complaints have to be quicker.
4 – Ban dual agency
Dual agency happens when an agent signs a contract with both the buyer and seller, and represents both in a transaction. It’s impossible for an agent to properly represent both! It’s a pure conflict of interest!
It would be great if legislation was amended so that an agent could only represent one or the other in a specific transaction. The onus should be on the listing agent to advise a prospective buyer to seek representation and that the agent not refer a brokerage or another agent.
Taking one step further, it would be great if organized real estate followed the British model, whereby brokerages are designated to either seller or buyer representation
5 – Agent incorporation
This one is a no brainer; sales reps and brokers alike should have the equal opportunity to incorporate themselves without restrictions, like any other company. We work as independent contractors without the benefits of incorporation. A more attractive tax rate will benefit the consumer with how a property is marketed, and listing commissions will be less because of better tax benefits for the agent, hence the benefit to the consumer.
These five things that I would like to see changed in our industry have come with careful thought from all my years of being a real estate broker in Ontario.