Province ends real estate industry’s ability to self-regulate

Wednesday, June 29th, 2016

Naoibh O’Connor
Vancouver Courier

Premier Christy Clark announced new measures Wednesday to deal with the real estate industry. Photo Dan Toulgoet

The B.C. government is ending the real estate industry’s right to self-regulate a day after a scathing report was released about practices within the sector — a report Finance Minister Mike de Jong called “illuminating and troubling.”

Premier Christy Clark and de Jong made the announcement at a press conference Wednesday afternoon.

Clark has been under increasing pressure to introduce measures to address realtor misconduct, as well as take actions that might cool the red hot market.

Tuesday’s Independent Advisory Group (IAG) on the conduct and practices of the real estate industry featured 28 recommendations — seven for government — aimed at improving governance, oversight, transparency and accountability.

“The point of regulation is to protect people, it’s to protect consumers. It is not a right when it comes to self-regulation. Self-regulation is very much a privilege that’s granted on behalf of the public by government to professions that say they can do the job and prove that they can do the job,” Clark said. “Well, the real estate sector has had 10 years to get it right on self-regulation and they haven’t. So we are going to end the right of the real estate sector to self-regulate.”

Clark said the government accepts the IAG’s recommendations and will take immediate action on all of them.

It will establish a dedicated superintendent of real estate to do what’s necessary to “increase public confidence” in the sector. The superintendent will take over the real estate council’s regulation and rule-making authority and have the power to take away commissions from those who break the rules. The public will have easier access to make complaints about shady practices, including through a whistleblower line.

Clark said, as per the IAG’s recommendation, the government will “dramatically” increase fines for those who break rules to $250,000 for individuals and $500,000 as a maximum for brokerages, and change the composition of the Real Estate Council so it has a majority of public-interest, non-industry members.

Realtors will also no longer be able to represent both a buyer and seller.

“It is primarily important that we protect consumers, but the role of the Real Estate Council and regulator is also to protect the vast majority of realtors who are honest, hardworking people from having their reputations tarnished by a few shady operators,” Clark said. “So we want to make sure, with these changes, we’re able to put consumers first and make sure we are protecting the vast majority of agents who are doing a good job.”

Clark said more actions will be taken in coming weeks that are informed by six principles — a focusing on increasing supply, linking communities together through transit, supporting first-time home buyers get into the market, protecting consumers from shady practices and increasing the rental supply across the Lower Mainland, in particular, but across the province.

“And, most importantly, making sure the dream of home ownership remains in the realm of possibility for the middle class,” she said.

The announcement comes a week after Mayor Gregor Robertson announced the City of Vancouver will implement an empty home tax with or without the help of the province. Robertson met with de Jong on Monday to explore the possibility of such a tax.

When asked what the province will do to make cities more accountable for increasing supply through measures such as zoning, Clark said the municipal, provincial and federal governments all have a role in addressing the affordability problem.

“There are things we can do in supporting rental supply, the federal government can do that through tax changes as well, and obviously on zoning the municipal government can do something,” she said. “It’s a matter of finding ways to work cooperatively.”

© 2016 Vancouver

Comments are closed.