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HomeNewsAcronyms Bring Big Changes To Real Estate - Understanding TRESA

Acronyms Bring Big Changes To Real Estate – Understanding TRESA

Author, Keith McDonald is a Broker, Realtor with Birdhouse Realty in Lindsay, ON

KAWARTHA LAKES-Utter the words “Sales Representative” and you might think of a car salesperson or that kid working at a tech store. You’ve probably already thought of another example. What you didn’t think of was a Realtor. Say the word Realtor and you know immediately what and who that is. But did you know, that before October 2020, Realtors were not allowed to call themselves Realtors? Yeah, read that right. Everyone knew us as Realtors, even called us Realtors, but we couldn’t identify ourselves or advertise as Realtors. Enter TRESA, the Trust in Real Estate Services Act, 2002. The Trust In Real Estate Services Act was created with you, the consumer, in mind, giving you more options and protections, simplifying confusing language and bringing the real estate profession into the twenty-first century.

TRESA was rolled out in three phases, with phase one rolled out more than two years ago, back in October of 2020. If you caught yourself reading the beginning and saying “huh, I didn’t know that”, then you, like most folks, didn’t even know phase one was rolled out. Why? Phase one didn’t get much news coverage because, well to put it bluntly, it was boring. Phase two was launched December 1st, 2023, and ‘oh boy’ did it get some attention!

First, let’s begin with a question some of you might be asking. Why is it called TRESA 2002 and not 2023? Was that a typo? The answer – the old legislation, REBBA 2002 (Real Estate Business Brokers Act), was not repealed or replaced, it was changed. And one of the many changes was to the actual name.

Another change that has made headlines across the province was the introduction of an open bidding or open offer process. Prior to December 1st, 2023, Sellers were not allowed to disclose the details of competing Offers. The only rule was that Buyers who made an Offer on a property were entitled to know the number of competing offers they were up against. That has not changed. What has changed? The Seller can now choose to share the details (price, closing date, conditions) of an offer to others. Here are the rules for the new open offer process. 1) No identifying information can be shared such as a Buyers name. 2) The information shared must be shared with ALL buyers who have made an Offer. 3) That’s it. There are no other ground rules, it truly is an “open” bidding process. Here’s what you need to know. The decision to conduct an open offer process rests solely with the Seller, not the Buyer. The Seller can choose to be upfront, ahead of time, about conducting an open offer process, but is also allowed to change their mind from a blind bidding process to an open offer process at any time, even during the presentation of offers.

Don’t panic. Here is what I would recommend. If you are a Seller, lean on your Realtor and ask what direction would be best. Ask what the pros and cons would be of doing either a blind bidding or open offer process. Ensure you understand the process fully. If you are a Buyer, ask yourself “how would I feel if the contents of my offer (price, conditions, closing date) were shared with other Buyers?”. Talk to your Realtor for advice, what to expect and how you might be able to protect yourself.

There is a reason eBay has a “Buy It Now” button. Open bidding might not be for you…or is it?

If you found this article interesting, stay tuned for part two in January where I discuss other TRESA changes such as Self-Represented Parties & Designated Representation.

 

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