Ontario’s Real Estate industry underwent a bit of a transformation on December 1^st, 2023 with the arrival of the Trust in Real Estate Services Act (TRESA). This pivotal legislation replaces the Real Estate and Business Brokers Act (REBBA) and introduces several changes designed to fortify consumer protections and foster greater transparency within the province’s active Real Estate market. We are excited about these changes as we believe they will provide better clarity through the Real Estate process and ensure professionalism in our industry. It’s important to understand how TRESA impacts both Buyers and Sellers in Ontario Real Estate, so let’s dig into what exactly changed and what it means for you.

A Transparent Approach: Open Offers

Let’s begin with what might be the most impactful change for Buyers and Sellers that TRESA brings—open offers. With this addition REALTORS®, upon Seller consent, are able to divulge details about offers to Buyers in the event of multiple offers. Sellers have the liberty to determine the extent of information shared, excluding any personal information of the Buyers (name, address, etc.). For example, the Seller may choose to only share the conditions and deposit amounts outlined in the offers, while keeping all other details confidential. The Seller can make and retract their decision to share information at any time during the offer process, as long as the proper documentation is followed.

Another implication of this change during the offer process, is a Buyers choice to participate (or not) in an open offer situation, and the pros and cons of both options. We at the Lisa Hartsink Team believe it’s imperative to discuss the potential of an open offer scenario with our clients prior to making an offer and work according to their best interests.

This move is a step toward transparency for Buyers, while also providing Sellers with a valuable tool during negotiations, making it even more important that both Buyers and Sellers choose a REALTOR® with valuable knowledge and experience to help navigate the often-complex process.

Learn more about buying and selling with these posts next:

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Why Title Insurance is So Important for Homebuyers

Understanding Mortgage Affordability in Today’s Market

Providing Clarity: RECO Information Guide

The Real Estate Council of Ontario (RECO) has published an information guide for anyone considering assistance from a REALTOR® for the purposes of Buying, Selling or Leasing. This guide is a detailed explanation of things you need to know when working with a REALTOR®. Real Estate Agents are required to walk you through this guide before providing services or assistance to Buyers, Sellers, Landlords or Tenants. The RECO Information Guide can be viewed here.

Redefining Relationships with REALTORS®: Clients and SRPs

In the past, the line between a “Customer” and a “Client” might have felt subtle and unclear for some, yet it carried profound implications. Under TRESA, the term Customer is being discarded, and we are introduced to the distinction between a “Client” of a brokerage and a “Self-Represented Party” (SRP).

To receive services from a REALTOR® and their brokerage, an individual must be a Client. This relationship is formalized through either a Buyer/Tenant Representation Agreement or Seller/Landlord Representation Agreement (Listing Agreement). Within that agreement, Clients may choose to enlist the full services provided by a REALTOR®, or, defined limited services according to their individual needs.

An SRP is an individual who has chosen to trade in Real Estate independently and does not wish to receive any services from a REALTOR®. It has been our experience that most people do want the assistance and services of a REALTOR® to help them navigate the often complex buying and selling process.

Regardless, both SRPs and Clients are required to complete mandatory documentation defining their relationship with a REALTOR® before engaging in trade. This nuanced shift ensures better clarity in the relationship between Clients, SRPs and REALTORS®, providing a better framework for ethical and fair dealings.

Reducing Conflicts of Interest: Designated Representation

TRESA introduces the concept of Designated Representation, akin to models employed in provinces like Alberta. Our old model focused on Multiple Representation or Dual agency where the Listing Brokerage may represent both the Buyer and Seller in the same transaction, which sometimes caused a conflict of interest. Designated Representation allows an agent to be assigned within the Brokerage to represent either the Buyer or the Seller in the same transaction so each party would have their own individual representation. The Brokerage would then retain oversight and responsibility for each of the designated agents’ duties to their respective clients, and no conflict of interest would apply. This ensures impartiality within the brokerage and distinct representation for each client.

Enhanced Focus on Ethical Obligations: The Code of Ethics

Under TRESA, Ontario’s real estate professionals must now adhere to an updated Code of Ethics aimed at bolstering consumer protection and minimizing conflicts of interest. The Trust in Real Estate Services Act (TRESA) ushers in a new era for Ontario’s Real Estate landscape.

The Trust in Real Estate Services Act (TRESA) marks a pivotal shift in Ontario’s real estate landscape, ushering in transparency, clarity, and ethical conduct. At The Lisa Hartsink Team, we believe these changes will only enhance and elevate our team’s commitment to assist our clients with the utmost integrity through their Real Estate journey with us. TRESA’s introduction of open offers promotes transparency, empowering Buyers and Sellers with vital insights while preserving privacy. Redefining relationships between Clients and Self-Represented Parties streamlines engagements, ensuring clear boundaries and ethical frameworks for all involved. The concept of designated representation fosters fairness and personalized guidance within brokerages, reducing conflicts of interest. As TRESA reshapes the industry, our unwavering commitment remains—to navigate these changes seamlessly, fostering a real estate journey founded on compassion, integrity, and performance, tailored precisely to your needs. Ready to embark on this transformative journey? Connect with us for an empowered and educational Real Estate Experience.

Get in touch today by calling 905-873-9944, emailing info@lisahartsink.com, or fill out the form on this page!