President's message: A time of transition

Most of you are aware that the Supreme Court of Canada ruled last month that it won’t hear the Toronto Real Estate Board’s (TREB) appeal of a 2016 Competition Tribunal decision.

The decision essentially says that TREB must ensure its members have the ability to display information for their clients in a Virtual Office Website (VOW) equivalent to what’s available in the MLS® system with exceptions for private fields like REALTOR® Remarks and showing information.

A VOW is different from a public website that advertises listings for sale. It’s a password-protected online space for you to provide services and share information virtually instead of a face-to-face setting.

The decision calls on TREB to allow its members to display previous home sale prices, pending sold prices—where no conditions remain other than closing— and cooperating commissions within a VOW.

TREB was given two months to comply with the Bureau’s order.

While this ruling applied in name to TREB only, the Competition Bureau is expecting other boards in the country to follow suit in a timely manner. They’re paying close attention to our Board.

The Competition Bureau contacted us days after the Supreme Court announcement to request a meeting to discuss our policies on the use and online display of MLS® information and to learn about any changes we’re considering.

We’ve told them that we plan to comply. We’re now working with our legal counsel and the legal team at CREA to adapt our systems, contracts, and processes to comply with the Bureau’s order.

We expect to complete this work in the next 60 days.

Until then, we’re in a transition period.

We’re aware that some members have changed their VOW feeds in anticipation of the new rules. We encourage members to wait to see and understand the changes we announce before modifying your VOW practices.

We must ensure that we implement these changes in a way that respects the privacy of our clients and maintains the quality and integrity of our MLS® data.

We’ll provide more information as our work in this area progresses over the balance of this year.

We thank you for your patience as we work through this period of change.

Register for our October breakfast meetings

Your Board of Directors is hosting our annual breakfast meetings in October to engage with you on key issues affecting your business and the profession.

At the sessions, we’ll update you on the campaign we’re developing to help improve the public image of REALTORS® in our market.

Board President Phil Moore and a representative from the marketing firm we’ve hired will discuss the research and strategy behind the campaign and present some of the creative concepts we’re considering. Phil will also discuss the cost of embarking on a high-profile campaign of this nature.

Next, Phil and Board CEO Brad Scott will discuss the recent Supreme Court ruling in favour of the Competition Bureau against the Toronto Real Estate Board. They’ll outline the details of the case and what implications the decision will have on members, the Board, and the public.

Attend one of the four free meetings we’ll host around the region this October and share your feedback with us!

Here are the meeting dates and locations:

• Wednesday, October 17 – Capilano Golf Club, 420 Southborough Drive, West Vancouver
• Thursday, October 18 – Sandman Signature Hotel, 10251 St Edwards Drive, Richmond
• Tuesday, October 23 – Italian Cultural Centre, 3075 Slocan Street, Vancouver
• Friday, October 26 – Executive Plaza Hotel, 405 North Road, Coquitlam

Each meeting will start at approximately 8 am with registration and breakfast. Presentations will begin at 9 am and end at approximately 11 am.

Register today with Member Services by calling 604-730-3090 or emailing memberservices@rebgv.org.

We look forward to seeing you at one of these meetings!

Changes to the Rules of Cooperation coming November 1

Your Board, along with the Fraser Valley and Chilliwack boards, recently approved changes to our Rules of Cooperation. The changes range from minor tweaks to the inclusion of new rules and a new form. They’ll go into effect November 1, 2018.

The Rules of Cooperation define expectations for the conduct you can expect when dealing with other members in your day-to-day business. They’re in place because of the competitive nature of our business – REALTORS® compete for business while representing their clients’ interests in negotiations.

What’s changing?

The biggest changes are in Section 3 – Listings and Section 4 - Offers. A new form, the Direction Regarding Presentation of Offers form, will be required if the seller has instructions related to delayed offer presentations and/or whether a buyer’s agent can attend at the presentation of their offer.

Other changes to the Rules deal with attachments to listings like documents and photos, contingent listings, showings, title searches, and manufactured/modular homes. There are also changes in other sections affecting offers and presentations, sales reporting, open houses and showings, signage, and lockboxes.

Resources to help you learn these changes

We’ve prepared a thorough comparison guide displaying the old and new Rules side-by-side so you can see what’s changed. You can also download a copy of the new Direction Regarding Presentation of Offers form here or use the live form already on WEBForms.

The Ethics Guy® Kim Spencer is covering these changes in a series of in-depth columns. You can read the first installment in this newsletter. It contains an overview of the Rule changes and rule-by-rule breakdowns and rationales for changes. He’s also creating 10 new ‘Top Tip’ videos to explain the changes in greater detail.

Review these resources before the new Rules go into effect November 1. We’ll share more resources as they’re available.

Rules of Cooperation changes — what you need to know (Part I)

The more things change, the more they stay the same. New Rules of Cooperation changes will take effect on November 1. Some rules have been tweaked. Some have been changed substantially. Others are untouched.

There are also some new rules so some existing rule numbers have been re-ordered. To review a side-by-side comparison of the existing and amended Rules of Cooperation, click here.

Let’s first review what the Rules of Cooperation are. Formerly known as the MLS® Rules and Regulations, they're the rules of engagement governing member’s conduct and obligations to each other in their day-to-day business. These rules are not restricted only to MLS® transactions unless the context requires. The very common questions of Can I do this? or What should I be able to expect from my colleague? are probably already dealt with in the Rules of Cooperation. Our other set of rules, the REALTOR® Code, details what the public ought to be able to expect from us. The Rules of Cooperation generally details the kind of behaviour we should be able to expect from our colleagues.

All three boards subscribing to the Rules of Cooperation (REBGV/FVREB/CADREB) have now approved the rules changes and so this is our first opportunity to make you aware of them. Even though some rules have changed, the rationale for having member rules of engagement remains the same. We compete for business. And, we represent our clients’ interests in negotiations. While things don’t have to become adversarial, they sometimes do. The reason is often that someone wasn’t aware of what should've been done to ease the way along the journey to a showing, offer presentation and/or successful contract negotiation. So while there are some changes to what we’re obligated to do for each other, the reason for the rules remains the same.

Read on for my best effort at summarizing the rule changes in plain language. I cover Sections 1 and 3 in this column, and I'll cover Sections 4-9 in my next column.

Section 1 – Definitions

• “seller” includes owner, landlord and lessor;
• “buyer” includes tenant and lessee;
• “listing agreement” includes property listings for rent;
• “offer to purchase” includes an offer to rent or lease;
• “sale” or “contract of purchase and sale” includes rental or tenancy agreement or lease;
• “completion of sale” includes commencement of a tenancy or lease.

Section 3 – Listings

• 3.10 – Deadline for Submission of Listings: The three calendar day (excluding statutory holidays) requirement has not been altered. But, members whose listings are deemed to be late may now “be required to resubmit the listing with a current effective date.” Rationale: Spot-auditing of MLS® documents and listing information is a necessary part of compliance.

• 3.11 – Listing Documentation: A new Direction Regarding Presentation of Offers form (introduced with changes made to Rule 4.02) is to be included with the standard MLS® Listing Contract and Data Input forms when a listing is submitted to the MLS® Department for circulation (only) if the seller has special instructions regarding delayed showings or offers. Rationale: Inconsistent practices relating to delayed offer presentations have resulted in a number of members being disciplined by the Board. Requiring members to use a standard form signed by the seller, giving details as to any delayed offer presentations, must now be submitted to the Board so as to mitigate this risk.

The Privacy Notice and Consent brochure must be provided to every seller with a signed receipt being retained on file at the brokerage in the same way that the Working with a Realtor® brochure was dealt with. Rationale: The Working with a REALTOR® brochure was retired when the Superintendent’s Office introduced its new disclosure forms. His new forms did not address the Personal Information Protection Act requirement that Realtors must give consumers information as to why their personal information is being collected and how it will be treated. The creation of the Privacy Notice and Consent brochure was necessary to satisfy this Personal Information Protection Act requirement.

• 3.12 – Consent to Post Documents to the MLS® System: (New rule.) Our MLS® System allows documentation to be attached to listings. Members posting additional documentation to their listings are now responsible for “securing all the necessary consents” before that information is posted. And, unless the seller instructs otherwise, a copy of the basic title search must be loaded to the Paragon Associated Documents tab by the member within 24 hours of the listing becoming active on Paragon. Rationale: To support members’ privacy compliance programs and the Board’s risk management, members must consider whether a document they attach to a listing contains information that is, or may be, personal or sensitive, confidential, trademarked or is someone else’s intellectual property and to get the necessary consents in writing before posting. And, requiring members to attach a basic title search (with the seller’s consent) within 24 hours of their new listing going live on the MLS® System is supportive of good risk management.

• 3.13 – Manager Approval of Listing Brokerage Loaded Listings: (Formerly 3.12) Managing brokers have always been obligated to review and approve listings. This rule has been changed to require that they review and approve listings before they are broker-loaded into the MLS® System. The rule’s previous wording only required that listings be reviewed and approved prior to listings being circulated. Rationale: Accurate information is the foundation upon which the MLS® System’s reputation rests. It is vital that information be checked and approved before it is entered into the system.

• 3.16 – Changes to Listing Information: (Formerly Rule 3.14) members are required to “communicate” to cooperating brokerages if they have made a change to a listing’s information “from the time the change was made and until such change has been published in the MLS® System and such period of time thereafter as is reasonable in the circumstances.” The requirement has been enhanced to require the communication be made in writing by listing brokerages when they notify cooperating brokerages. Rationale: It is better practice to communicate information in writing than verbally. This change closes a risk-management gap and reduces the chance of a brokerage/member mis-communication about important changes to listing information.

• 3.20 – Contingent Listings: (Formerly Rule 3.19) Members are required to specify contingent listing information in the listing contract and in Realtor Remarks. The amendment to this Rule 3.20 adds an exception to that general requirement namely, “with the exception of contingencies that reference commission, in which case the contingency must be stated in the listing contract and in the commission field.” Rationale: Back when MLXChange was our MLS® System, we allowed information about commissions in the Realtor Remarks because of limitations to the commission field.  Since Paragon became our MLS® System, these limitations ceased to exist.  As such, commission information has not been permitted in the Realtor Remarks since at least 2016.  The amount of commission for a cooperating agent is contract information which requires a seller’s signature and cannot be modified by a member without prior written instruction from the seller.

• 3.21 – Seller’s Rights Reserved: (Formerly 3.20) members are required to note, in Realtor Remarks, when the sellers have reserved the right to sell the property themselves. The amended Rule 3.21 adds an additional requirement that the sellers’ reservation of the right to sell the property themselves must be noted in the listing contract as well as Realtor Remarks. Rationale: The right of sellers to opt out of a listing contract and to sell the property themselves is just one example of a contingent listing and, consistent with Rule 3.20 above, must be noted in the contract, not just Realtor Remarks.

• 3.22 – Member Access to Listed Properties: (Formerly 3.21) Members are required to make all MLS® listings available for showing.  Members have been allowed to use a “delayed showings” strategy so long as the delay is for a defined period of no more than 7 days and, because this is a contingency (see Rule 3.20), it must be in the listing contract and in the Realtor Remarks. The allowable delay of 7 (calendar) days has been reduced to 5 (calendar) days. The rule also previously required Listing Brokerages to notify Cooperating brokerages that had “requested a viewing appointment” if a written offer was received before the requested viewing appointment was to take place. There is now an added requirement to notify Cooperating Brokerages who “have requested in writing to be kept informed about offers” (i.e. without necessarily having requested a viewing appointment) that an offer has been received during the “no show” period and is scheduled for presentation.  Note that these notifications must take place before presentation.  Rationale: Input received from members suggested that 7 calendar days was too long.  The original recommendation was to reduce the number of days to zero, meaning that showings would have to be accommodated without delay, but a compromise was reached at 5 days. Adding the requirement to notify Cooperating Brokerages who ask to be kept informed about offers closes a gap in the existing rule.

• 3.24 – Unauthorized Accommodation and/or Use: (Formerly 3.23) Members are required to note in Realtor Remarks when the listing contains unauthorized accommodation. The obligation to disclose has now been expanded to include uses that are “not authorized.” Rationale: The seller’s use of a property may not be apparent through inspection and/or in public records and therefore an unauthorized use such as a short term rental must now be disclosed in Realtor Remarks to reduce the chance of a misrepresentation. This requirement may also help to mitigate negative public perception that members’ advertising of unauthorized property uses condones illegal practices.

• 3.25 – Photographs, Pictures and Sketches: (Formerly 3.24) now includes a requirement that at least one property photo must be provided for each listing within 5 days of the listing’s effective date. The existing rule does not allow photographs containing information that is considered to be promotion of a Member. A more specific requirement has been added to this portion of the rule namely, “For Sale and Sold” signs are not permitted in photos on MLS® listings. Rationale: The value in the MLS® System is the completeness of the information it contains. Listings without pictures hamper the ability of those reviewing listings to properly evaluate them. Members have, in the past, argued that a photograph containing their for sale or sold sign was not personal promotion. The rule amendment now makes it clear that members’ For Sale and Sold signs must not appear in photographs submitted to the MLS® System.

• 3.26 – Title Searches: (Formerly 3.25) This Rule now requires members to conduct a basic title search (if one is not being provided by the Board) “prior to, or at the time of taking a listing.” Rationale: To reduce the chance of a property being listed without the consent of all the owners, all listings posted on the MLS® System must have a basic title search done, whether provided by the Board or obtained by the Listing Brokerage, to confirm who the registered owners of a listed property are.  Remember that new Rule 3.12 requires the listing agent to post the title search as an attached document on the listing within 24 hours of the listing becoming active.

• 3.32 Manufactured Homes/Modular Homes/Park Model Homes: (Formerly 3.21, Manufactured Homes.)  Extensive changes have been made to this rule to specifically address modular and park model homes as well.

Nominations for our Board of Directors election due November 15

We’re looking for qualified candidates to run in the 2019 REBGV Board of Directors election.

Great directors bring skills, experience, and dedication. They focus on strategic direction, performance monitoring, financial performance, risk management, and succession planning.

If you think you have the skills and experience to make a difference in your profession, we want to hear from you.

To learn more about being a director and how our nomination process works, read our brochure on becoming a director. For a copy of the nomination package, email us at becomeadirector@rebgv.org. The deadline to submit a nomination is Thursday, November 15, 2018.

Attend our candidates information session on October 22

The Board Development Committee is hosting an orientation session for those interested in running. It's on October 22 from 9:30 a.m. to 11:30 a.m. at the REBGV office on 2433 Spruce Street in Vancouver. If you’re interested in attending, please contact Katherine Allan at kallan@rebgv.org or 604-730-3073.

Here’s a summary of the skills and experience that help make a great director:

• Leadership – experience managing a commercial or not-for-profit entity.
• Board experience – experience on a corporate or not-for-profit board.
• Business acumen – experience operating a business.
• Information technology – an understanding of how technology applies to business processes.
• Accounting and finance – accounting designation or experience as a financial officer.
• Human resources – experience with staff recruitment, succession planning, and compensation.
• Legal – a law degree or experience managing legal issues of a complex commercial nature.
• Marketing – experience leading marketing or customer service initiatives.
• Regulatory – knowledge of the issues associated with a commercial entity regulated by statute.

More supply and less demand seen across Metro Vancouver housing market

The supply of homes for sale continued to increase across the Metro Vancouver housing market in September while home buyer demand remained below typical levels for this time of year.

Sales

The Real Estate Board of Greater Vancouver (REBGV) reports that residential property sales in the region totalled 1,595 in September 2018, a 43.5 per cent decrease from the 2,821 sales recorded in September 2017, and a 17.3 per cent decrease compared to August 2018 when 1,929 homes sold.

Last month’s sales were 36.1 per cent below the 10-year September sales average.

“Fewer home sales are allowing listings to accumulate and prices to ease across the Metro Vancouver housing market,” Ashley Smith, REBGV president-elect said. “There’s more selection for home buyers to choose from today. Since spring, home listing totals have risen to levels we haven’t seen in our market in four years.”

Listings

There were 5,279 detached, attached and apartment properties newly listed for sale on the Multiple Listing Service® (MLS®) in Metro Vancouver in September 2018. This represents a 1.8 per cent decrease compared to the 5,375 homes listed in September 2017 and a 36 per cent increase compared to August 2018 when 3,881 homes were listed.

The total number of properties currently listed for sale on the MLS® system in Metro Vancouver is 13,084, a 38.2 per cent increase compared to September 2017 (9,466) and a 10.7 per cent increase compared to August 2018 (11,824).

For all property types, the sales-to-active listings ratio for September 2018 is 12.2 per cent. By property type, the ratio is 7.8 per cent for detached homes, 14 per cent for townhomes, and 17.6 per cent for condominiums.

Generally, analysts say that downward pressure on home prices occurs when the ratio dips below the 12 per cent mark for a sustained period, while home prices often experience upward pressure when it surpasses 20 per cent over several months.

“Metro Vancouver’s housing market has changed pace compared to the last few years. Our townhome and apartment markets are sitting in balanced market territory and our detached home market remains in a clear buyers’ market,” Smith said. “It's important for both home buyers and sellers to work with their Realtor to understand what these trends means to them.”

HPI Benchmark Price

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,070,600. This represents a 2.2 per cent increase over September 2017 and a 3.1 per cent decrease over the last three months.

Sales of detached properties in September 2018 reached 508, a 40.4 per cent decrease from the 852 detached sales recorded in September 2017. The benchmark price for detached properties is $1,540,900. This represents a 4.5 per cent decrease from September 2017 and a 3.4 per cent decrease over the last three months.

Sales of apartment properties reached 812 in September 2018, a 44 per cent decrease compared to the 1,451 sales in September 2017. The benchmark price of an apartment property is $687,300. This represents a 7.4 per cent increase from September 2017 and a 3.1 per cent decrease over the last three months.

Attached property sales in September 2018 totalled 275, a 46.9 per cent decrease compared to the 518 sales in September 2017. The benchmark price of an attached unit is $837,600. This represents a 6.4 per cent increase from September 2017 and a two per cent decrease over the last three months.

Click here to download the full stats package.