Considering the holidays were in full swing, you may have missed the new legislative changes to the Trust in Real Estate Services Act (TRESA) that took effect on December 1, 2023. Amending the legislation is part of a push by the Ontario government to strengthen consumer protections during the real estate transaction process. Along with trade associations such as the Canadian Real Estate Association, TRESA governs how real estate brokerages, brokers, and agents can conduct business with buyers and sellers in the province. With the spring cottage real estate market upon us, a looming interest rate announcement from the Bank of Canada next week, and newly released consumer price index data from Statistics Canada revealing that Canada’s annual inflation rate rose to 3.4 per cent in December, a lot is happening on the cottage real estate front. Now is the time for buyers and sellers to familiarize themselves with the new rules and how it will affect them.
Ray Ferris, the broker of record for Erie’s Edge Real Estate in Long Point, Ont., and the former president of the Ontario Real Estate Association, says two important changes directly impact cottager buyers and sellers.
What is designated representation and how is it different from before?
While designated representation isn’t a new business practice in other provinces in Canada, it is a first for Ontario. Under the new TRESA rules, when a client signs a designated representation agreement it avoids a scenario where they might receive limited services if the same real estate brokerage is on both ends of the transaction. Now, the agent can exclusively represent the buyer without limiting the information that they can share if the listing agent is from the same brokerage. Ferris says this offers a few advantages to cottage buyers who are coming from outside of the area.
“If a buyer from Toronto didn’t want to work with me because they didn’t want to receive limited services, they may go back to Toronto and strike up a conversation with the realtor from the city to help them buy the property that they looked at in Long Point, three hours away,” explains Ferris.
Under the old rules, a buyer might choose to go with another real estate agent from outside of the area as a way to avoid a multiple representation situation. Ferris contends an agent who is unfamiliar with the cottage area may prove to be disadvantageous to the buyer.
“They won’t know if internet is available in Long Point, what day garbage pickups are, or what the zoning bylaws are,” says Ferris. “So, at the end of the day, designated representation ensures consumers can work with realtors who intimately know the community in which they’re working.”
Disclosing the terms and conditions of competing offers to buyers
Another big change is that sellers have the option of disclosing offer information and terms to buyers—it’s known as open bidding. Before the new rules came into effect, sellers had to conduct blind bidding, which meant they could not reveal to buyers what the terms of competing offers were. As Ferris points out, the new legislation doesn’t force sellers into picking either approach.
“The seller doesn’t have to tell buyers in advance of them putting forward an offer in writing whether or not they’re going to share the contents of competing offers,” he says.“The seller can do whatever the seller wants.”
Of course, the objective here is for the seller to get the best offer they can get. “There’s no right or wrong answer. It will depend upon the circ*mstances at the time because every transaction is unique,” says Ferris. “At the end of the day the seller is going to decide whether to share, based on what they think is the best thing for them to get the best terms—generally, that’s the most amount of money for their property.”
- Realtor.ca launches open offers in an effort to curb bidding wars and inflated property prices
- Critics of Ontario’s new open bidding policy say it will do little to curb prices
How are these new rules playing out in cottage country?
As the broker for Erie’s Edge, Ferris deals with a lot of cottage transactions along the north shore of Lake Erie, including in Long Point, Turkey Point, and Port Dover. He says that winter is typically a slower time for cottage real estate.
“We haven’t seen a lot of this [sharing of contents of competing offers] as of yet because, in cottage country, we’re not experiencing a lot of sales at this time of the year.”
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Ontario's market for cottages is set to experience an increase in 2024 standing out as a leader in the appreciation of properties throughout Canada. Expected to see an 8% rise in prices for family cottages Ontario offers an exciting real estate environment for those who love cottage living.
What are the new real estate laws in Ontario? ›
The new rules, effective December 1, 2023, will give Ontarians more choice in the real estate trade process by allowing a brokerage to disclose the details of competing offers.
What act governs real estate in Ontario? ›
The Real Estate and Business Brokers Act, also known as REBBA, is an act that regulates the relations of all participants and processes of the Ontario real estate market. What is TRESA?
What is Tresa in Ontario real estate? ›
The Trust in Real Estate Services Act, 2002 (TRESA), is consumer protection legislation governing the conduct of real estate agents and brokerages trading in real estate in the province of Ontario.
Are pandemic buyers struggling to unload cottages Ontario? ›
Ontario cottage owners who bought their piece of paradise during the pandemic are now struggling to unload properties as punishing interest rates are driving down prices that had exploded over the last three years, experts say. And things could be worse in the spring with an anticipated “deluge of listings.”
What is happening to the housing market in Ontario? ›
Ontario Market Report Summary
The average selling price of a home in Ontario decreased by 4.3% year-over-year to $885,100 in June 2024. The average selling price of a single-family home in Ontario decreased by 4.1% year-over-year to $973,400 in June 2024.
What is the new housing legislation in Ontario? ›
TORONTO — Today, the Ontario government introduced the Cutting Red Tape to Build More Homes Act, 2024, as part of its ongoing commitment to cut red tape, speed up government processes and build at least 1.5 million homes by 2031.
What are the coming soon rules for real estate in Ontario? ›
A “coming soon” sign can only be posted at a property three calendar days before the property is listed on MLS, and of course, that property must be listed on MLS and cannot be sold off market, as per the changes four years ago.
What is the Riot Act in real estate? ›
The Riot (Damages) Act 1886 ("1886 Act") applies to any house, shop or building that may have been destroyed or property that has been stolen or destroyed, in both instances "by any persons riotously and tumultuously assembled together", but does not extend to business interruption.
What is estate law in Ontario? ›
Overview. An estate is a legal term used to describe the assets (money, property and personal items) and debts a person leaves when they die. An estate plan helps ensure your wishes are followed after your death, including what happens to your money, property and personal items and who will manage your estate.
9 (1) Real property not disposed of, conveyed to, divided or distributed among the persons beneficially entitled thereto under section 17 by the personal representative within three years after the death of the deceased is, subject to the Land Titles Act in the case of land registered under that Act and subject to ...
What is the Better Homes Act Ontario? ›
On October 25, 2022, the Ontario government introduced the More Homes Built Faster Act, which takes bold action to advance the province's plan to address the housing crisis by building 1.5 million homes over the next 10 years.
What does Brreta mean in real estate? ›
Today, when buying or selling real estate, the customer will select the type of representation he/she prefers. Among these representations are seller's agents, buyer's agents, and transaction brokers, which are defined by the Brokerage Relationship in Real Estate Transaction Act (BRRETA).
What is a bona fide in real estate? ›
A bona fide offer is an offer made in good faith and without deceitful motives. It's a legally binding agreement that safeguards both the buyer and seller from fraud and misrepresentation[1].
What does Grec mean in real estate? ›
Georgia Real Estate Commission Responsibilities
So, what does GREC do? GREC is responsible for: Administering the real estate license law relevant to brokers, salespersons, and community association managers in Georgia. Maintaining licensee records and compiling reports.
Is it a good time to buy a cottage in Ontario? ›
In recent months, industry experts have said that 2023 and heading into 2024 could be the right time to purchase a cottage. In the Ontario real estate market, for example, some reports suggest that a single-family home in a recreational part of the province could tumble by five percent.
How much will the Muskoka cottage prices be in 2024? ›
Year-over-year, 54 per cent of Ontario's cottage markets saw average prices decline between five and 28.7 per cent, including Muskoka (down five per cent, from $1,487,265 Q1 2023 to $1,412,237 in Q1 2024); Kenora and Lake-of-the-Woods (down seven per cent, from $389,066 in Q1 2023 to $361,852 in Q1 2024); Grand Bend ( ...
How much has Haliburton cottage prices dropped? ›
Average sale price in the Haliburton cottage market decreased by 26 per cent year-over-year (from $869,756 in Q1 2022 to $643,549 in Q1 2023).
How much down payment required for cottage in Ontario? ›
Quite a few applicants look to get a cottage as a second home. With that, they would need a second mortgage, in addition to their current home's mortgage, for cottage. Typically when buying a cottage you need to have a minimum down payment of 5% to 10% of the value of the cottage.
