Realtors want rule change to open bidding process

The Ontario Real Estate Association is making more than three dozen recommendations to the provincial government on how it should update the rules governing realtors, including allowing for a more open bidding process for buyers and sellers.

In a report Thursday, the group says the Real Estate and Business Brokers Act (REBBA), put in place in 2002, is in need of a revamp. “The average price of a home in 2002 was $275,000 in Toronto and most deals were closed by a fax machine,” said Tim Hudak, chief executive of OREA, which has more than 70,000 members. “This legislation is out of date.” One suggestion is permitting realtors to disclose details about a competing offer to another bidder, if all sides involved agree. This would include offer price, closing dates and any conditions.

The group says doing so would result in a more “transparent” multi-offer process that would give buyers more information to make their best offer, and sellers the knowledge that they have received the best offer for a property. Currently, most buyers and sellers participate in a blind bidding process where buyers go in with an offer, in the hopes they are not outbid. If they are, they are then asked to raise their bid, but without knowing the details about the alternate offer. “Whether consumers decide to consent to a transparent multiple offer process or not, they should have the choice under REBBA,” according to the 33-page report. The report follows a yearlong review of the legislation by a task force made up of the heads of the country’s top brokerages.

The report also suggests tougher rules be introduced against those who operate as real estate “consultants,” to avoid being required to register and train as realtors. Among the 37 recommendations, the report suggests: Reverting the number of hours

■ required to complete a realtor licence to 255, from the newly decreased 120 hours (set to come into effect in 2019). Requiring builders and developers

■ to register under the act to sell pre-construction properties. Doubling the maximum fines for

■ those who break the REBBA code of ethics to $50,000 for salespeople and brokers and $100,000 for brokerages.