Approaching Legislative Amendments Targeted to Improve Transparency and Consumer Protection in Real Estate Transactions

By Slonee Malhotra

The traditionally discreet nature of real estate transactions is set to change with the implementation of the Trust in Real Estate Services Act, 2020 (TRESA, 2020)[1]. TRESA, 2020 is a proposed amendment to the Real Estate and Business Brokers Act, 2002 (REBBA),[2] which is the legislation that governs real estate brokerages, brokers, and agents (“registrants”) in Ontario.[3] The amendment, set to take effect in April of 2023, is intended to improve transparency and consumer protection.[4]

There will be five main changes to the legislation.

1. Competing Offer Disclosure: In addition to being allowed to disclose the number of competing offers on a house, the new legislation would permit a seller’s agent to disclose the content of competing offers at the seller’s discretion.[5]
2. Increased Transparency by Real Estate Agents: The proposed changes would increase the amount of information that must be shared by registrants with buyers and sellers so they can make informed decisions.[6]
3. Increased Efficiency of RECO:
   1. Increasing publicly available information.
   2. Allow for the collection of transaction data about real estate transactions: This would increase RECO’s ability to implement targeted compliance and enforcement initiatives.
   3. Increased Authority over Administrative Matters: This would allow RECO to regulate advertising and record-keeping. Further, it would allow RECO to require brokerages to provide notice of important changes. [7]
4. Broaden Scope of Discipline Committee: The Discipline Committee’s powers will be expanded from issuing fines and mandating registrants to take educational courses, to suspending, revoking and applying conditions to a registration.
5. Updated Code of Ethics for Agents and Brokerages: Since the last review of the Code of Ethics (Code), over 20 years ago, the real estate industry has evolved. The amendments are intended to reflect these changes by providing clarification and adding a layer of professionalism.[8]

Have a question about the approaching amendments? We would be pleased to review with you. Contact Slonee Malhotra, a qualified real estate lawyer with SorbaraLAW.