There have been some MAJOR CHANGES in how we do real estate with YOU the public!  And the changes are intended to protect you, keep you totally informed from start to finish of EVERYTHING WE ARE DOING!  I personally believe these changes came about not long after the COVID crisis, when everything seemed to suddenly get “loose & fast” and many of our clients started to question the integrity of the Real Estate Industry in general!  And how about us – their trusted Realtors?  Could we be trusted to take care of their “largest financial investment”?  I’m sure many buyers & sellers who felt deflated and disturbed by much of went on from 2020 through 2022 may have asked the question – who do we trust here?

So, the Trust in Real Estate Services Act (TRESA) took effect on December 1, 2023, replacing the 20-year-old Real Estate and Business Brokers Act (REBBA). The new Act brings better consumer education and transparency to the buying and selling experience and is designed to protect the best interests of the client (buyer or seller).

Whether you’re buying or selling now or in the future, we break down the main concepts of TRESA to help you navigate the new rules now AND before, during and every step of the way through a transaction.  This may not have been the case for many of our buyers and sellers in the past.

ONE BIG CHANGE:  Clients, Not Customers

In the previous REBBA, an agent could work with a buyer or seller as either a “client” or a “customer”. In the new TRESA, any buyer or seller working with an agent is now called a “client”. This shift was to remove the confusion around who is a client and who is a customer, with any party represented by an agent now referred to as a client. A seller choosing not to have an agent represent them is now called a self-represented party (SRP). In this case, the seller is responsible for the listing price, staging, marketing, organizing showings, and negotiating offers. While this may save the seller real estate fees, it comes with inherent risks, specifically the absence of professional advice from a licensed Broker or Realtor with the experience to price a home correctly and negotiate the deal on their behalf.

Changes Around Representation

Until now, real estate agents could act as multiple representatives, meaning they could represent both the buyer and seller in a sales transaction. Those situations sometimes resulted in limited disclosure and a buyer whose best interests might be poorly represented. With the recent changes, the buyer and seller can be assured they will have their own designated representation. This means that if one brokerage represents both the seller and buyer, they will each have their own agent who will act in their best interest. This allows agents from the same brokerage to disclose more information and represent the best interests of their clients.

New Code of Ethics

The new code of ethics was designed to protect the client (buyer or seller) and ensure their best interests are the agent’s top priority. Now agents and sellers are required to disclose all known information about a property that may impact the buyer’s decision to make an offer and of how much. Personal information about the buyer or seller must remain strictly confidential and cannot be shared with anyone outside of the brokerage without the expressed written consent of the client, even years after a sale. Agents must also avoid any situation that can be considered a conflict of interest and affect their ability to act in their client’s best interest. If a conflict arises, the client must be informed, and the agent may not continue their representation without the client’s written consent.

Transparent Offer Process

The new additional transparency clause means that sellers can now share the details of competing offers with buyers. Personal information remains private; however, the seller can decide whether to hold open or closed offers. If the seller chooses an open offer process, the buyer would be informed of competing offers, including prices, terms, conditions, deposits, and closing dates. The seller can also change their mind at any time as long as the agent includes the clause in their agreement. A buyer may opt out of the “open-bid” arrangement as well.

The Reco Information Guide

The Real Estate Council of Ontario (RECO) is the governing body of real estate professionals in Ontario. The new guide was designed to hold agents accountable for any non-compliance issues related to TRESA and may suspend or revoke an agent’s designation once a complaint is investigated. Under the new Act, each buyer and seller will receive the RECO information guide upon agreeing to representation with a broker. The guide provides all need-to-know information to help buyers and sellers navigate the real estate transaction.

While the new Act contains a lot of changes, the main takeaway for buyers and sellers is greater transparency, better protection, and more choice in agent representation.  

NEED TO KNOW MORE?  Give us a call or send an email and I will happy to get back to you with answers!

Warm Regards, 

Lynn Fee