The way real estate agents conduct business in Ontario is changing! Effective December 1st, 2023, the Trust in Real Estate Services Act (TRESA), is increasing transparency and fairness to consumers. While many of the rules and regulations remain the same, there are a number of new forms and key changes to the legislation. Below, we'll cover several of the most prominent new initiatives that you, as a consumer, need to know.
Introduction of the new mandatory RECO Information Guide
This new guide covers a variety of topics, the main purpose being to explain the different types of relationships available to a consumer: self-represented party (SRP), limited representation agreements, or full service representation agreements (both listing or buyer). It outlines the risks of representing yourself and the benefit of receiving services while in a client relationship. Note that a SRP cannot receive any type of service or advice from a real estate agent excluding what is public knowledge. Ex. Listing prices of houses in the area. Consumers must acknowledge once they have read the guide. For more information, visit the link above or download the PDF version of the RECO Information Guide.
2. There are no longer customer service agreements, only clients or self-represented party (SRP)
The old regulations allowed a consumer to receive limited services without entering into a client relationship with a brokerage (customer service agreement). This type of relationship no longer applies. Consumers have the option to become a SRP, or enter into either a limited client OR client representation agreement. The main difference being that an SRP can only receive general advice and cannot receive any services unless the agent is acting on behalf of a seller client. If a consumer wishes to receive limited services only, for example they wish to view properties, they could enter into a limited representation agreement where these services are clearly defined. To access a real estate agent’s full range of services they must enter into a buyer or seller representation agreement. The pre-written conditions on the OREA forms remain the same.
3. There are two instances where a self-represented party (SRP) can receive services from a real estate agent
Expanding on the above topic, an SRP can only receive services from a real estate agent in two circumstances: The agent can provide general public information to an SRP like market statistics OR provide assistance to an SRP when the service is for the benefit of their client. An example would be showing their seller client’s listing to an SRP or the mechanics of filling out an agreement of purchase and sale.
4. All disclosures must be in writing and a written acknowledgement that they have been received must be obtained
If a real estate agent’s seller client has disclosures pertaining to a listing, they must disclose them in writing, in clear and concise language, and display prominent placement of the word disclosure. Once the disclosure is received by way of a written acknowledgement, it must be signed and a copy must be provided to the client.
5. Sellers have the option to disclose contents of written offers in multiple offer situations
Previously, details of an agreement of purchase and sale could not be openly shared to other parties in a multiple offer situation. Now the seller has the option to provide written direction to share the contents of competing offers, excluding any personal identifying information. Contents can be shared as the listing agent and seller see fit – they do not necessarily have to share the entire offer(s), but only key details of different offers, or however they decide.
6. Multiple representation still exists, however there is an alternate option for designated representation (to limit the constraints of multiple representation)
Because TRESA implements greater use of client relationships (limited, and full representation), and no longer employs customer service agreements, it gives way to more multi-rep situations. During multiple representation the brokerage/real estate agent could be representing both the seller and the buyer. In an effort of fairness, services become limited to general guidance as to not favour one client. Both parties have to agree to multiple representation. If either client does not agree to this, there is an option for designated representation. This allows a brokerage to designate a different real estate agent to each party. So while both seller and buyer are in client relationships with the brokerage, it is not considered multi-rep since they each have a different designated agent.