Countdown to the June 15 rule changes

The new Real Estate Council of BC (Council) rules go into effect on June 15 for all real estate licensees in BC. These rules effectively ban limited dual agency in BC, address how you’ll disclose remuneration to sellers, and set new education and language proficiency requirements.

Here are the key resources you need to prepare for the new rules:

New mandatory forms and usage guides

Council recently released the new forms you'll need to use to comply with the new rules. They are:

• Disclosure of Representation in Trading Services
• Disclosure of Risks to Unrepresented Parties
• Disclosure of Risks Associated with Dual Agency
• Disclosure of Expected Remuneration

The below guides explain how to use each of the four new mandatory forms, including frequently asked questions about the situations in which they'll be required. Access them here:

• Disclosure of Representation in Trading Services guide
• Disclosure of Risks to Unrepresented Parties guide
• Disclosure of Risks Associated with Dual Agency guide
• Disclosure of Expected Remuneration guide

Review these guides so you're prepared to use the new forms. You'll be able to access them from WEBForms on June 15 in six languages: English, Simplified and Traditional Chinese, French, Persian, and Punjabi.

Note: These forms can’t be used before June 15.

Licensee Knowledge Base

Council developed a ‘one-stop shop’ for all the information you need to prepare for June 15. It’s called the Licensee Knowledge Base. It’s a user-friendly, searchable resource with information delivered in a variety of formats. Click here to access the knowledge base.

Rule Changes: Agency and Disclosure course

Council collaborated with the UBC Sauder Real Estate Division to develop a new online course called Rule Changes: Agency and Disclosure. Beginning in October, you'll need to provide proof that you’ve completed this course before you can renew your real estate license.

You’ll only be able to register via a link that Council emails you based on your license expiry date. Licensees whose licenses expire in October 2018 will have the first opportunity to register. 

Click here to learn more about this new required course.

Other key resources

• Real Advice newsletter archive
• Real Talk, Real Advice podcast
• Rules changes FAQ

Review these resources to prepare for Council’s new rules on June 15. We’ll provide more information as it becomes available. 

Council announces required course on new rules

The Real Estate Council of BC (Council) recently released information about its new required course Rule Changes: Agency and Disclosure. Beginning in October, you'll need to provide proof that you’ve completed this course before you can renew your real estate license.

The course covers the technical requirements and rationale behind the rule changes, and what they’ll mean to your day-to-day business.

Here’s what you need to know:

Registration

You’ll only be able to register via a link that Council emails you based on your license expiry date. If your license expires between October 2018 and June 2019, you’ve already received your registration link. The final registration links will be sent on June 13.

Council’s email link is currently the only way you’ll be able to register for this required new course, so look out for this email and save it when you receive it. They’ll open a registration page for all licensees once the final registration links have been sent in June.

Course structure

Rule Changes: Agency and Disclosure is a self-paced online course that should take approximately 5 to 6 hours to complete. There are five modules:

• A Primer on Agency
• Disclosure of Representation in Trading Services
• Disclosure of Risks to Unrepresented Parties
• Disclosure to Sellers of Expected Remuneration
• The Ban on Dual Agency and Dual Agency Disclosure

Each module consists of an introductory video, a lesson, and an assessment. You must score 70 per cent or higher on the assessment to pass each module.

Course completion and license renewal

When you successfully complete the course, you’ll receive a completion letter from Council. Please save this letter and include a copy of it with your renewal application when it’s time to renew your license.

Cost

The course costs $75. You’ll be asked to pay this fee when you register online.

To learn more about this new course, visit Council’s website.

The Ethics Guy®: Incoming!

When you’re sitting in the water at the bottom of a foxhole and you hear a shell headed your way, the appropriate response is to yell to your comrades, “Incoming!” At least, I think this is what happens in the U.S. Army. The Brits probably say, “Oh, I say, there’s a spot of bother headed our way.”

We have some “incoming” from the superintendent and Council. Since this is almost my last chance to write about the new rules before they take effect on June 15, 2018, what better time to talk about them than now?

For most members, I think, “new rules” means the forms just made available on May 14. For others, “new rules” means everything that'll change for us on June 15. Here's a reminder—a laundry list of questions you should ask yourself:

• Am I making regular visits to the Council’s comprehensive licensee knowledge base?
• If I'm a managing broker, have I visited the Council’s Managing Broker Toolkit?
• Have I considered how I’ll manage potential conflicts of interest if they develop, and have I explained, in advance, to my clients what I’ll do about these conflicts if they occur? (One way of handling this is to consider where your listings and deals come from and identify the most common types of potential conflicts of interest you’ll encounter.)
• Have I considered scenarios that'll trigger the use of the new forms and what the timing is for their delivery to someone?
• Am I thoroughly familiar with the superintendent’s four new forms:
  • Disclosure of Representation in Trading Services and its guide;
  • Disclosure of Risks to Unrepresented Parties and its guide;
  • Disclosure of Expected Remuneration and its guide; and
  • Disclosure of Risks Associated with Dual Agency and its guide?
• For these forms, have I scripted how I’ll deal with them, explained their content, and asked those with whom I deal to acknowledge that I’ve done so?

Besides answering these questions, don’t forget to consider how you'll manage your record keeping. Council expects these forms to be kept for at least seven years. Yes, you can maintain them in electronic format if easily printed. Note: Your brokerage must have these forms on file. You’ve probably already agreed to provide all required documentation to your brokerage via your independent contractor agreement.

Some of you may be concerned about all of these details. Keeping calm and carrying on would be more helpful.

Helpful too, is Council’s new online course, Rule Changes: Agency & Disclosure. I audited this course last week. Although I like live instructors, I found the online instruction surprisingly good. It took me 3.5 hours to complete, but then, I’ve been talking about this material forever.

The information was well presented and easy to understand. The content includes an agency primer reminding you about the basics, and then it takes you through the use of the new forms, describing how they’re triggered and how you can meet Council’s requirements.

Every licensee is required to take this course. As Council puts it, “Effective October 1, 2018, real estate professionals licensed to provide trading services (real estate sales) or rental property management services must, as part of the Council’s mandatory Relicensing Education Program requirements, complete the Rule Changes: Agency & Disclosure course in order to renew their licence.”

Think about taking the course sooner rather than later because it contains information I know you’ve been looking for.

REBGV sponsors and presents at Board of Trade housing forum

Metro Vancouver’s municipalities must come together to build a regional housing plan to reduce processing times and costs for building housing and increase the variety of supply that’s so clearly lacking today.

That was the message from Board President Phil Moore last week at the Greater Vancouver Board of Trade’s housing forum.

Your Board sponsored the sold-out event that also included BC Housing Minister Selina Robinson, Urban Development Institute (UDI) CEO and President Anne McMullin, Anthem Capital VP Kevin Falcon and others.

“We need to make our region more streamlined and responsive to the housing needs of its residents,” Moore said. “There’s no quick fix. We can’t tax our way to affordability, nor only build our way there.”

The May 25 event featured over four hours of discussion from a diverse cross-section of real estate experts from government, industry, and not-for-profit sectors.

Minister Robinson opened the event with a keynote presentation. She discussed her government’s 30-point housing plan that was announced in February.

Robinson said these measures are helping to “curb demand and stabilize prices.” The provincial government has also pledged to forge partnerships and invest $6.6 billion over 10 years to create 114,000 affordable homes in the province.

On the speculation tax, Robinson said that 99 per cent of British Columbians won’t pay the tax. The finance ministry did reveal this month, however, that two-thirds of home owners hit by the tax will be British Columbians.

UDI CEO and President Anne McMullin reminded the audience that the tax will also apply to development lands, which will increase the cost to build new market and rental housing.

“The speculation tax and school tax increase will add $20,000 in development costs for a condo and $30,000 for a townhome.”

With Metro Vancouver’s population expected to grow another 24 per cent by 2041, a common theme at the event was for more collaboration to improve housing affordability and meet the region’s current and future housing needs.

Read our next newsletter for links to presentations and a more in-depth analysis of the information and policy suggestions put forward at the event. 

Over-regulation has made Vancouver the most expensive place to build a home in Canada

Over-regulation costs Vancouver builders an extra $644,000 on average when building a single-family home—twice as much as any other city in Canada, according to a study published by the C.D. Howe Institute.

The study, Through the Roof: The High Cost of Barriers to Building New Housing in Canadian Municipalities, finds that barriers to building make up about half the cost of housing in Metro Vancouver. This cost is on par with Manhattan.

“Recent policies, such as taxes on foreign buyers or new federal mortgage rules, have focused on curtailing the demand for housing, instead of taking meaningful steps to increase the supply,” says Benjamin Dachis, one of the authors of the study.

Zoning rules, restrictions on developing agricultural land, and development charges are putting upward pressure on both new and existing housing prices, according to the report.

The report looks at the gap between the construction costs and the final sale price of a project. To do this, they combined the physical cost of construction, the cost of the land, and a 17 per cent profit earmarked for the developer. They then compared this to the final sale price of the project, which they called the “construction cost gap relative to sale price.”

In a functional market, this gap should be minimal. However, as regulations, taxes, permit delays, and restrictions affect the project, this gap increases. Developers will then pass these costs on to the home buyer.

In Vancouver, this gap is not only the highest in the country, it’s among the largest internationally as a share of market costs, according to the study.

The solution? According to C.D. Howe, municipal governments and provinces should enable more housing construction by taking steps such as easing restrictions on developing agricultural land, simplifying and updating zoning bylaws, and reducing development charges.

C.D. Howe is an independent not-for-profit research institute whose mission is to raise living standards by fostering economically sound public policies.

Protecting new home buyers

When your clients buy a newly constructed home, BC's Licensing and Consumer Services (formerly the Homeowner Protection Office) is the provincial agency that protects them and improves the quality of residential construction.

But what, exactly, does this agency do? To help you and your clients understand, we’ve created a fact sheet.

Read more.

Municipalities could soon have the power to zone rental-only areas

If your clients own land and plan to construct multi-unit residential buildings, it's important for you to understand how Bill 23, new provincial legislation that allows rental-only zoning, could affect their plans for their neighbourhood.

Read more.

Open for business, positioned for growth

REALTORS® in the Tri-Cities should prepare to be busier than ever. We recently hosted a municipal update event where the mayors of Coquitlam, Port Coquitlam, and Port Moody shared their plans for housing and their forecasted population growth. They also unveiled their plans for providing commercial services.

Read more.

What's Happening in Real Estate - May 2018

Watch our new video that looks at the latest news affecting real estate in Metro Vancouver.

Let's celebrate REALTORS'® charitable works

Each year we advertise to the public how much REALTORS® contribute to charity. Here's how much you've donated since 2007:

How much will it be for 2017?

We need your help again this year. Here’s how you can help:

Email the charities’ names and the amount you donated or fundraised to Fiona at fyouatt@rebgv.org. We keep your information confidential.

Ask your colleagues to send in their info, too.

Your privacy matters

We’ll only promote the aggregate charitable total to the public. No personally identifiable information is released.

*This total includes an REBGV member’s one-time donation of $21.4 million. Click here for more information about this donation.