Excerpt from the discussion of the New Rules in the house on May 16, 2018.
Hansard transcript from the legislature May 16, 2018
D. Barnett: Can the minister confirm her understanding of the role of the office of the superintendent of real estate and how the ministry oversees the office of the superintendent of real estate’s power to make the rules and regulations governing the real estate regulations in B.C.?
Hon. C. James: Thank you to the member for the question. I think it’s important to note that the Office of the Superintendent, their authority, is in legislation as an independent regulator for real estate. [DRAFT TRANSCRIPT ONLY]
Their authority comes from the legislation brought in by the previous government in 2016. They have the responsibility for oversight of the Real Estate Council, responsibility for rules for the practise of real estate — filing practices for real estate developments, for example — and responsibility for REDMA, for the act. So basically it’s the oversight, it’s the authority for making rules, and for the filing practices of real estate. [DRAFT TRANSCRIPT ONLY]
D. Barnett: In mid-April, the minister announced a review of B.C.’s real estate regulators to make sure that British Columbians are effectively protected. The ministry has not only hired the lawyer conducting the review but has also set the terms of reference for the review itself. When asked in question period on May10 about the impacts of a dual-agency ban, the minister confirmed the independence of the superintendent of real estate as a regulator.
My question to the minister: how does the minister simultaneously claim to hold the office of the superintendent of real estate at arm’s length, to protect its independence as a regulator, while also holding the full power to set the terms of reference for a review, hire the lawyer conducting the review and holding the power to make legislative changes governing the superintendent of real estate’s regulatory powers? [
Hon. C. James: Thank you to the member for the question. I think it is an interesting piece to do a little bit of unpacking when we take a look at the superintendent of real estate and the Real Estate Council, because I think there are some questions that have arisen. [DRAFT TRANSCRIPT ONLY]
Where does the authority for the minister come from when it comes to doing a review of the superintendent of real estate and the Real Estate Council? Because I think it’s important to note that the review is of both — of the structure. The responsibility comes because I, as minister of this area of responsibility, am responsible for the legislation that sets out the terms of reference for the superintendent and for the Real Estate Council. [DRAFT TRANSCRIPT ONLY]
I have the ability — and I believe the responsibility — to listen to issues that arise. There have been, in this structure that was put in place by the previous government…. So this is a structure that we inherited. In 2016, the previous government put this structure in place. There have been questions raised. There have been questions raised around clarity of who is responsible for what, to put it in a very simple term. Clarity of powers. Who is responsible for addressing what piece? Overlapping responsibilities between the council and the superintendent.
I believe I have a responsibility on behalf of consumers, on behalf of others to make sure that there is an effective regulatory structure in place. That’s why there were questions and why a structure was put in place by the previous government — it’s that there were issues raised.
I think it is time to do that review to make sure that those questions that have come up from the public, from real estate agents, from others — that we actually review them, that we look at those overlapping responsibilities. We have an obligation to make sure the system is effectively regulated.
That’s why I have called for the review. That doesn’t have anything to do with the superintendent and the existing powers that they have through legislation. Those are already there. But as governors, we all have a responsibility to make adjustments to legislation if we believe that adjustments need to be made.
D. Barnett: Through you, Madam Chair, to the minister. Minister, I don’t believe that answers my question. And maybe I didn’t make it quite clear enough. My question is…. You are the government. You have the authority to make the legislation. You have hired the lawyer. You are making the rules with recommendations from this lawyer.
My question is: why are new regulations going to be put in place, new processes be put in place, before the review is even completed and put back out there for public comment?
The Chair: Thank you. And I’d like to remind members to please direct your questions through the Chair
Minister. Hon. C. James: Thank you very much, Chair, and through you to the member. I think it’s important to note that the member is quite right. We are government, and we have a responsibility to manage the legislation.
The legislation is in place currently. The legislation currently says that the superintendent has the responsibility to make the rules, to carry out the rules, to get them out there. I do not, as the minister, or as government have the ability to arbitrarily to manage the legislation. The legislation is in place currently.
The legislation currently says that the superintendent has the responsibility to make the rules, to carry out the rules, to get them out there. I do not as a minister, or as government, have the ability to arbitrarily say I’m not going to pay attention to the legislation. The legislation is law. It is in place currently. [DRAFT TRANSCRIPT ONLY]
If there are future changes that need to be made, then I also have the responsibility to bring those changes forward and to make recommendations around those changes. But the current legislation is in place. The current legislation is the law, and the current legislation allows the superintendent — and in fact, requires the superintendent, as part of their duties — to put in place rules and to carry those out.
D. Barnett: As I have been hearing from my constituents and from individuals working in the real estate industry, the banning of limited dual agency will have a profound impact on both the consumer and the industry. In rural and northern B.C., over 64 percent of real estate offices have five or fewer agents. In northern B.C., the ban threatens to remove the choice of residents of who they want to represent them, to lead to the closure of many family-run small office closures and greatly limit access of consumers to professional real estate representation.
My question to the minister: if it is this minister’s goal to protect the consumer, what has the minister done to ensure the limited dual agency ban on June 1 does not negatively impact both consumers and the industry in rural B.C.?
Hon. C. James: I know we’ve had this conversation in the Legislature as well. As I’ve mentioned to the member and other members when the issue has come up around concerns that people have been raising around dual agency — as I’ve said then, I’ll mention again — I believe it’s important for representation to be there for individuals, whether you’re in a rural community or an urban setting.
My responsibility is to make sure that I hear those concerns and that I take those concerns to the superintendent, to the Real Estate Council. That’s just what I’ve done and have been doing since I’ve taken on this responsibility, because there are certainly issues that I’ve heard as well. I know the member has heard them, but I know that others in the House have also heard these concerns. Those issues were brought forward.
I also asked the superintendent to talk about the consultation process that has occurred. The superintendent did do a consultation with not only the real estate council, but public consultations have occurred over this last year, including meeting with the regional real estate boards in each of the regions in our province. Those concerns were heard, and I think, as I mentioned that has occurred. The superintendent did do consultation, with not only the Real Estate Council. Public consultations have occurred over this last year, including a meeting with the regional real estate boards in each of the regions in our province.
Those concerns were heard, and I think…. As I mentioned in the Legislature as well, the superintendent has informed me that there were considerations to accommodate rural and smaller communities under the new rules. For example, the new rules allow for an exemption for properties that are located in underserved or remote communities where it’s impractical for a consumer to receive alternate representation.
That is something that’s been put in place, the superintendent advises me, to address some of the concerns that have come forward, and the Real Estate Council would make that determination on underserved and underrepresented areas.
D. Barnett: Would you please define “rural and remote” and the size of these communities that you have just discussed?
The Chair: The preferred question might be phrased, “Would the minister…?” please.
Hon. C. James: I thank the member for the issue. The expectation is that real estate agents use their professional judgment on this piece. What will happen is that when the rule comes into effect, the Real Estate Council then has the responsibility to educate. So they’ll be getting the information out to all real estate boards and real estate agents to have a discussion about the intent of this exception. The intent, of course, is to ensure access, as we talked about before, for representation in areas where there are few licensees, where there aren’t a lot of options.
The Real Estate Council, remember, is responsible for education and discipline, and so they will be doing the work around education on this exception — what that means, what it looks like, what is practical on the ground — and then, as I said, real estate agents use their professional judgment. [DRAFT TRANSCRIPT ONLY]
D. Barnett: As it currently stands, the Real Estate Council of B.C. is comprised of 12 to 14 government-appointed members. Currently only two of these members are industry-licensed, and both are from urban British Columbia. Many in northern B.C. are worried that the concerns of the consumer and the local realities of industry practices in rural areas are not represented on the board.
Given that the current council’s term is ending on October 31, would the minister commit to ensuring that this important board is able to interpret the regulatory decisions of the Office of the Superintendent with a keen eye on the impacts of regulatory decisions impacting rural British Columbians? ensuring that this important board is able to interpret the regulatory decisions of the office of the superintendent with a keen eye on the impacts of regulatory decisions impacting rural British Columbians?
Hon. C. James: It’s a simple yes. As I mentioned earlier, I’ve heard the concerns, just as other members have. I’ve raised those issues and those concerns with the council, with the superintendent. So yes, I will continue to raise those issues about the importance of representation for people in rural communities. [DRAFT TRANSCRIPT ONLY]
D. Barnett: To the minister: thank you. Would the minister commit to ensuring that the council has more representation from licensed real estate operators and more representation from all over British Columbia, not just urban British Columbia?
Hon. C. James: In fact, part of the review that’s going on is representation, composition of the board. So those are exactly the kinds of issues that we are going to be reviewing and that we’re going to be making recommendations on, and then changes if changes need to occur.
D. Barnett: Would the minister commit here, today, to have the dual-agency ban on June 1 put on hold until this review is completed and the minister has had an opportunity to review the review before any other decisions are made for this industry?
Hon. C. James: I’ll just go back again for the member, to remind the member that we are living with the existing legislation put in place by the previous government. The previous government put the structure in place that gives the independence. I don’t have the ability, nor should I as an individual minister, to not follow the law. The law’s in place. It is up to the superintendent to make the determination around rules and to send those rules out. That’s the existing legislation.
If there are future changes in the legislation, that’s part of what we’re doing with the review. I’m not going to second-guess the review. I’m sure there are lots of people who are putting input in. We’ll take a look at the review and see if there are changes that need to occur.
D. Barnett: As the minister responsible for the legislation for the Real Estate Act, would the minister consider making legislative changes, if necessary, to protect the rights of the consumers in this province and to protect the real estate industry for many people who, without this industry, will certainly hurt rural and remote communities and will also affect the consumers in this province?
Hon. C. James: In fact, that’s exactly why the review is taking place. As I mentioned in question period as well, it is important to me that consumers have the ability. They have a well-regulated real estate industry. That’s important for the safety of consumers. It’s important for good representation. That’s precisely why the review is going on.
I won’t second-guess what the review will come forward with. I’ll wait until the review arrives, and then we’ll take a look at any changes that may need to occur to ensure that that positive regulation, that strong regulation for consumer protection and for representation is there for every corner of B.C., rural and urban, because that’s the direction. But I think it’s important to recognize, again, that the structure is something that we inherited. The structure was put in place. We inherited this structure. There are certainly issues that have been raised, and that’s why we’re looking at it.
A. Weaver: I’d like to carry on the line of questioning that my colleague from Cariboo-Chilcotin has been pursuing. [DRAFT TRANSCRIPT ONLY]
I’ve got several letters here from various organizations, but first I’d like to comment upon and seek your response to the statement that you’ve made. I do recognize right off the bat that this is legislation that government has inherited. It was brought forward as an amendment to the Real Estate Services Act by the former government [DRAFT TRANSCRIPT ONLY]
Cariboo-Chilcotin has been pursuing. I’ve got several letters here from various organizations, but first, I’d like to comment upon and seek your response to the statement that you’ve made. I do recognize, right off the bat, that this is legislation that government has inherited. It was brought forward as an amendment to the Real Estate Services Act by the former government. That amendment was put in, in the lead-up to, and following, some rather newsworthy issues that were occurring in Vancouver. The office of the superintendent of real estate was created through these legislative changes, and that office has put forward some measures which some would describe as a sledgehammer response to issues that arose in Metro Vancouver.
Now, there have been unforeseen consequences of this. According to section 89.2 of the Real Estate Services Act, the minister has regulatory power on all aspects of what the superintendent of real estate can do. So I would argue that, in fact, it is within the minister’s jurisdictional and legal right now to pass regulatory powers to limit the ability of the office of the superintendent, according to section 89.2 of the Real Estate Services Act, with respect to his or her jurisdiction in terms of licensing or requirements at this particular time. [DRAFT TRANSCRIPT ONLY]
Perhaps the minister could comment, and I will get back to some specific examples of why this is an important issue right now. [DRAFT TRANSCRIPT ONLY]
Hon. C. James: Thank you for raising the issue. The member is quite right. There are regulatory powers that exist around authority of the superintendent, as the member has mentioned, in the area of jurisdiction. [DRAFT TRANSCRIPT ONLY]
I think it’s important to note in this legislation, though, where the legislation identifies the superintendent as independent, that those regulatory powers also have to be balanced with the independence that is also in the legislation — so in taking a look at due process, whether due process was followed in bringing forward the rule; in taking a look at the discussion, the consultations, the work that was done around the consultations.
Remember that this recommendation around dual agency came forward as a central recommendation in 2016 from the independent advisory council. They brought this forward. They, again, did consultation. The superintendent’s office, again, lengthened the consultation.
I certainly, as I’ve said, have passed along the concerns. I think there are concerns there. But when I look at the balance of due process and balancing regulatory powers with the independence of the office, I did not see the ability to be able to utilize regulations in this specific case.
A. Weaver: With respect to the statement about the Independent Advisory Group, I understand that 28 recommendations were done. I would like to quote from a letter I received from the B.C. Northern Real Estate Board, which was copied to my colleague from Cariboo-Chilcotin. The letter says this: [DRAFT TRANSCRIPT ONLY]
“We are writing to request your support in our call to government for a review of the ban on limited dual agency. The ban was instituted, along with 28 recommendations from the Independent Advisory Group, after a limited review, no consultation with small communities and based on no empirical evidence. It is important to remember that the IAG began its less than 15 weeks of work in response to a ‘shadow-flipping issue in the Lower Mainland.'” [DRAFT TRANSCRIPT ONLY]
I come back to this. This is a very real concern that has been outlined and addressed by the member for Cariboo-Chilcotin that I would describe solely as a sledgehammer response to issues that were arising in Metro Vancouver. As the member for Cariboo-Chilcotin pointed out, there was limited, if any, representation from rural B.C. on the IAG. [DRAFT TRANSCRIPT ONLY]
Again, coming back to the issue at hand here, I understand that the minister has inherited this office from the prior government. I understand that the 28 recommendations came from the IAG. The problem therein comes in exactly with that consultation process, as well as with the recommendations and their implementation. [DRAFT TRANSCRIPT ONLY]
Just today, May 15, 2018, one month prior to the full implementation, finally rules have been put up on a website. I received an email from a couple of realtors in Parksville today in this regard. They haven’t even had the instructions, the guidelines, about how they’re supposed to implement these. There are brokers who are profoundly troubled about the legal liability they are taking on, by what can only be perceived as a half-baked list of recommendation follow-throughs, to implement these on a timeline that is just not possible, when there are no educational tools available. [DRAFT TRANSCRIPT ONLY]
[R. Kahlon in the chair.]
I’ll quote this right here. It says: “Today, one month prior to the scheduled rule implementation, the new forms and corresponding rules, interpretations, were finally emphasized, made available to licensees on the RECBC knowledge-base website. It’s notable that significant errors in the information required RECBC to retract and amend the information.” This is one month before it’s supposed to be implemented. [DRAFT TRANSCRIPT ONLY]
The error noted wasn’t typographical or grammatical but a clear misrepresentation of the rules. If there are troubles with the understanding of the rules with RECBC and the superintendent office, and realtors in B.C. are trying to implement these in a month — one month — we’ve got a problem. I think it’s a duty and responsibility that the minister recognize that she has the regulatory of the rules. If there are troubles with the understanding of the rules with RECBC and the superintendent’s office and realtors in B.C. are trying to implement these in a month — one month —we’ve got a problem. I think it’s a duty and responsibility that the minister recognize that she has the regulatory powers under section 89.2.
Again, I ask the minister, knowing that she has alluded to the consultation process, knowing that there are profound flaws with that, including the inability of realtors to get information on the topic until today, which was then retracted, is the minister willing to step in and use her regulatory powers or to insist that the independent office actually delay the implementation of its regulations — in particular, a limitation on dual agencies — now as opposed to waiting until disaster ensues on June the 15? [DRAFT TRANSCRIPT ONLY]
Hon. C. James: Thanks to the member. I think it’s just important to unpack a little bit of the issues that the member raises, because certainly I’ve heard those concerns and heard those specific issues as well.
I think it’s important to note that information has been posted since January. They’re continuing to post. Today it was the new forms that were posted. So it’s not that no information had gone out. Today they had the new forms go up. There have been previous postings that have been happening since January. [DRAFT TRANSCRIPT ONLY]
I think when the recommendation came forward — and the member, I’m sure, will remember this, as we both were part of that discussion — as the member had said earlier, it was in reaction to making sure that there was consumer protection in place.
Then concerns, as the member has rightly pointed out, were raised about representation for all of British Columbia. That’s why you see the exception there for rural and remote communities so there is an opportunity for rural and remote communities to have an exception to this rule if there isn’t proper representation. [DRAFT TRANSCRIPT ONLY]
Again, I come back to the issue of balancing the independence with the regulation. When there was process, when there was consultation, all of the real estate boards, all the regional boards were consulted through this process. That includes the Northern Real Estate Board and other real estate boards. The Real Estate Council, which is the body that licenses real estate agents — their own organization
When there was process, when there was consultation, all of the real estate boards, all of the regional boards were consulted through this process. That includes the Northern Real Estate Board and other real estate boards. The Real Estate Council, which is the body that licenses real estate agents — their own organization — has given written confirmation that they believe that everyone will be up and ready to go on the 15th of June.
Again, that reassurance has been given. So given all of that, from my perspective as minister, I think there was due process. It doesn’t mean that there aren’t concerns that have still been raised. That’s part of why, as I said, I’m making sure that I go through the review so that if there’s clarification around who is responsible for what, we’re able to look at that.
If there are still concerns after the implementation date, if people feel that the exception isn’t working, those will be concerns that I’ll continue to raise as well.
A. Weaver: I have two final questions. This is with respect to follow up on the issue.
Again, I’m quoting from a letter that I received today, in fact, from the Real Estate Alliance of B.C. This letter is referring to a response that they got on May 14, which was yesterday, from the office of the superintendent of real estate. The office of the superintendent said this: “Licensees should not wait until June 15, 2018, or council’s new course to prepare for the approaching implementation date. OSRE encourages licensees to take proactive steps to educate themselves” — in bold — “and determine what, if any, business practice changes are necessary to comply with the rules.” [
The superintendent is confident that the industry can and will adapt in a positive manner to the new rules. Well, that’s not very reassuring, because this is the counter-argument that is given. The assumption that licensees — these are realtors on the street — will be able to educate themselves and understand how to comply with the rule when it takes effect is unrealistic and unreasonable.
There are changes to the rule interpretations that are ongoing — daily, in some cases. Questions posed to regulators regarding the new rules have yet to be answered. The mandatory education course on compliance under the new rules has not yet been launched, nor will licensees have access to the education prior to the effective date of the rule implementation. The forms have just been made available to licensees on May 15.
We have a real problem here. We have an office of the superintendent of real estate that is implementing these new regulations, which are being applied in response to dealing with shadow flipping in Vancouver, frankly.
We’re having consequences across B.C. — one last question on limited dual agency in a second — we have realtors on the street who can’t get questions answered. We have the brokers who have a fiduciary responsibility, who are unable to train their realtors, because they can’t get answers. We’ve got the Real Estate Council not knowing who is on first base in the office of the superintendent, and we have rules changing on a daily basis.
Forms came out today, and apparently, one had to be retracted. This is a gong show, hon. Chair. And we cannot expect one of our…. I think it’s something like 30 percent of our GDP is in this broad sector. We cannot afford, as an economy, to have this uncertainty continue in the real estate sector, particularly in light of the fact that there are issues like speculation tax, employers tax, which I’m sure we’re going to canvass more thoroughly.
My question, again — the final question on this topic — to the minister is this. Will she, in recognition that there is chaos out there in terms of education, exercise her right under section 89.2 of the Real Estate Services Act to step in and ensure that the implementation date is deferred so that a proper consultation and due diligence can be done to ensure that licensees are actually educated across British Columbia.
Hon. C. James: I come back again to due process because I think that’s really the critical piece here when we’re taking a look at new rules coming in or we’re looking at changes and the ability to use regulations to override the independence. That’s really the balance that is required when you take a look at the legislation — the ability to set regulations but to be balanced off with the legislation that makes it very clear that the superintendent’s office is independent. [DRAFT TRANSCRIPT ONLY]
The Real Estate Council, as I said, is the governing body for all real estate agents in the province, rural and urban. They cover everybody. They are the professional body for real estate agents — have assured us and assured the superintendent’s office that agents will be prepared. That is the assurance that they have provided. They are the body that governs the real estate agents
The rule was announced in November 2017. So the rule was announced. I recognize, as the member raised, that there continue to be questions raised. But the information continued to go out.
I think, just in case anyone’s wondering what the dual agency is…. I realize we haven’t really talked about what the dual agency rule is. This is related to not allowing a real estate agent to represent both sides, as a consumer protection issue]
This isn’t a rule that changes practice for most agents or most communities, because you basically are saying to someone, “This is a practice that you can’t do,” and then the exception provides an opportunity in those communities where there are few real estate agents — or remote communities — the ability to get the exception. Someone can then look at representing both sides. So that opportunity is there.
I think the last piece I just want to touch on is the personal responsibility for real estate agents, who are professionals and who do have a responsibility to inform themselves.
Do I believe that we need to make sure that the information continues to be out there? Will I continue to raise concerns that I hear, just as the member has done, with both the superintendent and the council? Yes, I will. But in weighing the due process with the ability to use regulations to override the independence — I do not see the ability to be able to do that.
A. Weaver: My final question — and I’ll come back to that again — is…. Clearly I disagree with the minister on this. And clearly, just to follow up on the limited dual agency….
The limited dual agency serves very useful purposes in many cases. In rural B.C., it’s very important for those educated buyers who want to go directly to the listing agent. They know that they can negotiate a better price because there’s only one side of a commission that has to be negotiated.
Sometimes, for example, a realtor might have a slew of clients that they’re working with. They get a listing. What’s happening right now is that one of their clients….
Let’s suppose that I’m a realtor — let’s pick: in Comox — and I listed a house and had 15 clients who were going to come to that house. Then one of my people want to buy that house. Well, I go and find my other friend to be a realtor with them, and I now have to get off of both sides of this because I’m in a conflict because that was originally my client. Now I’ve assigned that client over to someone else, but I’m still the listing agent. I can’t even be the listing agent for that house
There are many, many problems that have arisen from this application. I recognize, again, that the government has inherited this mess from the previous government. And as it played out…. I don’t, frankly, think the previous government had thought it was going to play out the way it has, either. But we have a situation now where they have an impending deadline that’s going to likely lead to chaos. [DRAFT TRANSCRIPT ONLY]
I know, again from this application. I recognize again that the government has inherited this mess from the previous government. As it played out, I don’t, frankly, think the previous government had thought it was going to play out the way it has either. But we have a situation now where they have an impending deadline that’s going to likely lead to chaos.
I know, again, that the minister is setting up a review process. Why this is important is that there is a recognition that there can be potential conflicts of interest that arise in limited dual agencies. This is why, for example, in the province of Alberta, they’ve created something called a transactional agency, where they’ve created a different type of response for dealing with limited dual agencies in the case of potential conflicts. The review that B.C. is doing might, for example, come and recommend an approach like this.
The problem with not delaying is that if the B.C. review says, “We can see that it’s better to follow this transactional agency approach like they do in Alberta,” we’ve already gone and switched the whole system in B.C., and now we’re going to switch it back. This is chaos upon chaos. Surely the prudent response would be to pick up the phone or use regulatory powers under section 89.2 and say to the office of the superintendent: “Until such time as this review has been completed, we will recognize the potential conflict that may arise in limited dual agencies. There are solutions on the table. We don’t want to fix it twice. So let us delay the application of limited dual agency until, say, the fall, at which point we’ll re-look at it then
My question to you is: will the minister consider either picking up the phone and suggesting a delay on this or using what she seems reluctant to do — regulatory powers under section 89.2?
Hon. C. James: I just want to clarify one piece because this, again, comes to the details of the dual-agency rule that’s in place. Because of the consultation that occurred, because of the discussion that has been going on since November when the rule came out, there actually is a clarification. The example that the member used — where someone is selling a place, they’re representing it, they had a former client, the person came — that they would have to exclude themselves from both those sales is actually not accurate. With the rule clarified, they do have an ability…. Where both parties agree that they understand that that’s there, the person can continue to represent one of the parties. They don’t actually have to exclude themselves from that sale completely. I just wanted to make sure that people are aware of that. That is an important piece. [DRAFT TRANSCRIPT ONLY]
Again, when I take a look at that rule clarification, when I take a look at the exception that’s been put in place for dual agency in remote and rural communities, it’s hard not to say that there was a consultation process and exceptions made because of that consultation process — therefore, listening to the concerns that were raised to be put in here.
I think the other piece, just to clarify for the member, is that the review that’s going on is not a review of the rules. Right now the superintendent, according to the legislation, has the ability to set those rules. The review that’s going on is to clarify roles and responsibilities. Who is responsible for what? Where are there problems in place? Where does that need to be addressed? So the review wouldn’t, in fact, touch the rules one way or the other because that’s not part of the review process. It’s a review around roles and responsibilities — clarification there.
A. Weaver: I just wanted to thank the minister for her comments. I recognize that there were some…. This is part of the problem, actually. There’ve been numerous changes. Things are changing on the fly. With respect to the upcoming review, we must not forget section 89.2. Ultimately, neither of these other bodies has the rules. Ultimately, the rules fall squarely in the jurisdiction of the minister, who has regulatory power to say what they can and cannot do, in terms of the rules. I think that the minister needs to own some of these rules because they are within her regulatory power. I hope that we see that happen in the months ahead. [DRAFT TRANSCRIPT ONLY]
The Chair: I recognize the member for Prince George–Valemount.
S. Bond: Thank you, hon. Chair, and good afternoon.
I want to pursue a bit of this line of questioning as well. I thank my colleagues who have raised the issues. Certainly, my co-critic and I have some concerns as well. I want to very respectfully point out to the minister, as she continues to talk about the process of due diligence, that we would agree there needs to be due diligence. What we would argue with is the fact that it didn’t take place. I would also support what the Leader of the Third Party said. Our government did accept the recommendations. But I can also be very clear that the former Finance Minister directed the superintendent to consult broadly with the industry and the public. What exactly happened? [DRAFT TRANSCRIPT ONLY]
Well, we find things emerging. The minister says that listening did take place. Well, apparently not to the right people because double recusal, which is the issue that there has now been an adjustment on, should never have been a suggestion in the first place. Real estate agents would have said right off the bat that that does not make sense. It’s not just about geographic in that case. It is a principle in the trust that’s built with real estate agents. Suggesting that if you know someone, you can’t make a transaction…. Real estate agents — that’s what their job is all about. It’s about knowing everyone. It’s about knowing their community. It’s about connecting. [DRAFT TRANSCRIPT ONLY]
I would certainly…. I heard the member, the Leader of the Third Party, point out that we accepted the recommendations. Yes, we did. But there was no regulatory description around how those recommendations would be implemented. And the key factor was consultation. The real estate industry does not feel — and I would tend to agree with them — that there has been due diligence. And to point out…. Double recusal is one of those issues, but here’s another one. [DRAFT TRANSCRIPT ONLY]
The minister has referred to the underserved, remote location issue. Well, I certainly can’t explain it today, and I live in a region of British Columbia which, in some of my communities, I would fully expect would fit under this designation. But I have no confidence that that’s the case.
The council has suggested the exemption should be interpreted extremely narrowly. They have
Well, I certainly can’t explain it today, and I live in a region of British Columbia which, in some of my communities, I would fully expect, would fit under this designation, but I have no confidence that that’s the case.
The council has suggested that the exemption should be interpreted extremely narrowly. They have said that impractical means not capable of being done as opposed to simply being very difficult. So we’re still determining the rules of the game and expecting real estate agents to be able to manage that. [DRAFT TRANSCRIPT ONLY]
I have met with literally dozens of real estate agents in Prince George, and they’ve been very respectful, but they’re very concerned. I think the minister has it within her authority to simply say that there are too many missing details, that this has taken place too quickly, that there has not been enough consultation or discussion. [DRAFT TRANSCRIPT ONLY]
It’s time to put this on hold until the government, along with the office of the superintendent of real estate, can actually sort it out. Today, when the document that was posted was actually retracted, it wasn’t a grammatical error. It was a misinterpretation of policy, according to people who are depending on being able to understand this. [DRAFT TRANSCRIPT ONLY]
So it’s broader than we expected, certainly from my perspective. And I take responsibility for being part of a cabinet that said: “Yes, we’re going to accept those recommendations.” This has gone farther. There has been a lack of thorough consultation with the very people who this impacts. [DRAFT TRANSCRIPT ONLY]
And not only that, the minister spoke to the Real Estate Council’s responsibility for education. No one can educate until they understand what those changes look like. Forms are still coming out on a daily basis. We’re saying here on behalf of, certainly, our colleagues at the Northern Real Estate Board and across the province that it is time to say: “Let’s just take a minute here — an additional few minutes — and figure out how to do this properly.” And then perhaps….
I should also add that many, many of the recommendations real estate agents agree with. There is work that can be done and should be done. Let’s concentrate on the ones they agree with, and let’s work our way through definitions like “underserved remote locations.”
The minister has referred to that numerous times this afternoon. I’m wondering, then, if she could name for me the communities in British Columbia that would be considered underserved or remote.
Hon. C. James: Again, just to come back to the consultation. I think this is an important point around the balance, as we’ve been talking about this afternoon, between the independence and stepping in and using regulatory powers, which I know the member in particular is very concerned about, using regulatory powers, and has raised that a number of times. I think it’s just important to know that there is a balance there. I think the balance is important to go through.
Was consultation done? All real estate boards, through the spring of 2017, were in fact consulted, including the Northern Real Estate Board, and met with a number of times. There were multiple public consultations — several thousand responses back on the public consultation that occurred over the spring. So there in fact was consultation
I think the other piece that is just important…. I’ve mentioned it, but I think it’s important to mention again, that the council — the council, remember, is the body that regulates and disciplines real estate agents — has assured the superintendent that people will be ready to implement this, that they will be ready, and it will move ahead. I think that’s important to note.
The member asked about definition. In fact, the rule was put in place to deal with those exceptional circumstances. It doesn’t define a particular place because that, in fact, limits the number of exceptional circumstances that may occur. The rule was put in place to ensure that people in remote and rural communities have the opportunity to be represented, to be well represented.
There are 25,000 agents in the province — just so people have a number in their mind of what we’re dealing with. There aren’t a huge number of communities that have one or two real estate agents. This rule was put in place to be utilized, to actually be utilized and to be able to address precisely the kinds of concerns that are coming forward. [
If we continue to hear concerns, will I continue to raise those issues with the superintendent? Yes, I will, and with the Real Estate Council, because I think that’s the structure that’s put in place, and that’s important to do.
S. Bond: Well, it’s interesting to note that the definition now is either one or two, because I think that’s probably fairly new or emerging information.
I want to make an observation. I respect the minister’s decision that she may not want to use regulatory power. I guess what I’m a bit disappointed in is that the office of the superintendent of real estate doesn’t recognize that there are significant issues here — in essence, waiting for the minister to say: “Whoops. Let’s put a hold on this.”
I think that today, and for the past weeks and months, there have been continuous messages. I’m the first to admit: people don’t like change. But on the other hand, I would assume that at the end of this, we want an outcome that leaves the office of the superintendent with credibility, with an ability to work with real estate agents across the province.
I would today urge the minister to maybe not use regulatory power or authority but perhaps have a conversation, to say: “We could do this better.” The people that are actually having an issue with this are people who live in areas where this will be extraordinarily challenging, although my co-critic will talk to the urban issues in a moment.
There is a place for best practice and for consultation driving we could do this better. The people who are actually having an issue with this are people who live in areas where this will be extraordinarily challenging, although my co-critic will talk about the urban issues in a moment.
There is a place for best practice and for consultation driving improvements when a program is being implemented. I would urge a sober second look at this, to say: this is new, it is big, and it changes people’s approach to how they do their job. I cannot imagine why there cannot be a pause that is potentially initiated…. Perhaps if the minister’s not comfortable doing it, then perhaps the office of the superintendent should be thinking about that.
With those comments, I’m going to ask my critic to raise her questions. [
T. Redies: Minister, we’ve been speaking about some public consultation, but I’m very curious to understand what was the real direction of that public consultation.
I have a document here from a company called Insights West that has been employed to do a survey of British Columbians and what they feel about real estate and, in particular, dual agency. And 91 percent of British Columbians either strongly agree or somewhat agree with the statement: “I want to keep the right to choose who represents me in the sale of my property.” Ninety percent of British Columbians either strongly agree or somewhat agree with “I want to keep the right to choose who represents me in the purchase of a property,” and 86 percent: “If I engage the services of a realtor to help me buy a property, I expect the same realtor to show me their own listings as well as those of other realtors.” We’re not talking about numbers in the 40s or 50s. This is a fairly strong expression of what consumers expect when they are doing real estate transactions. [DRAFT TRANSCRIPT ONLY]
The other thing I wanted to raise, too, is just the whole consumer experience around the additional paperwork that is now being required. It’s just been dumped on realtors today. They’re looking at it. I’m getting many emails on this. Look, this is a terrible consumer experience. These documents are four or five pages long. There are already a lot of documents that have to be signed in a real estate transaction, so this is basically making the consumer experience worse.
I have to agree with my colleague from Prince George–Valemount and my colleague from Oak Bay–Gordon Head. Given the number of issues, whether it’s the clarity around the rules or the fact that realtors are only just today getting information about what they need to do between now and June 15 and don’t have sufficient time ONLY]
You’ve got insight here that suggests that consumers don’t want these types of regulations. Really, to avoid a mess in the industry, an industry that’s already facing a lot of issues — different rules at the federal level around real estate, different provincial rules and different municipal rules…. This is an important industry. It’s important to British Columbians. Surely it deserves a sober second look.
I can’t see any impediment or rationale why, with all of these issues, the superintendent and the Minister of Finance could not delay implementation until some of these things are properly resolved. Otherwise, I fear that we’re going to have a mess on our hands. The real estate industry has enough issues as it is.
Hon. C. James: Thank you for the discussion. Certainly, I’ve heard many of the concerns that members have raised, as I’ve said before
But I think it is important to also recognize that there was a large consultation done, a large discussion that occurred and ongoing conversations that are happening. I think it’s also important to acknowledge that the superintendents office continues to work with the B.C. Real Estate Association. The council of the association who represents all of those boards continues to have discussions and is also open to monitoring as we go along. I think those pieces are important to recognize.
The member mentioned the forms and the additional responsibility there. There’s also…. As the member may know, one of the recommendations in the 28 recommendations that also came forward was to make sure that forms are written in plain language, that there’s a better opportunity for consumers. That’s been part of the work that’s occurred as well.
Again, when I look at the balance of the two pieces, when I look at the facts, the information that I have to deal with that comes forward from the superintendent, from the Real Estate Council, from the bodies that actually monitor and are responsible for setting the rules, I think the process is here
Are there improvements that need to be made? Is there more information that needs to go out. Is there a need for consultation and discussions and ongoing dialogue to continue to happen? Yes, there is, and I’ll certainly continue to encourage that.
rules, I think the processes here…. Are there improvements that need to be made? Is there more information that needs to go out? Is there a need for consultation and discussions and ongoing dialogue to continue to happen? Yes, there is, and I’ll certainly continue to encourage that.
E. Ross: The dual agency is a big issue in my riding as well, and the realtors that come into my office are just saying that it’s a solution for a problem that exists in Vancouver, not in Skeena, and that it’s creating a hardship.