TREB vs. OREA: This Could Get Interesting

This story hit the wire on Sunday, and at the risk of stoking the fire here, let me say that I think this fight has legs.

The Ontario Real Estate Association represents about 70,000 agents in the province.  The Toronto Real Estate Board licenses 50,000 agents, all of whom are members of OREA.

With an overlap of 71% of licensees, it was only a matter of time before these two regulatory bodies butted heads…

RamsButtingHeads

This article is from The Canadian Press, and thus has appeared in many different media outlets.

I’ve taken the article from the CTV News website.

Here is how it appears in full:

 


 

Nicole Thompson and Armina Ligaya, The Canadian Press
Published Sunday, May 13, 2018 10:08AM EDT

TORONTO — The president of Toronto’s real estate board warned leaders of the Ontario Real Estate Association, headed by a former Progressive Conservative leader, to “stay in their lane” in an emphatic letter that relays his concerns that the provincial group is stoking fears about the housing market and becoming too political.

In a letter obtained by The Canadian Press, Tim Syrianos tells the president of the Ontario Real Estate Association — whose chief executive is long-time Tory Tim Hudak — that the organization should turn its focus away from political contests and affordability in the Greater Toronto Area, and stick to its mandate to promote the province’s housing market as a whole.

“It is misguided and ill-advised to attempt to supplant TREB and overtake our expertise and well-respected voice in our marketplace simply for media headlines and political gain,” Syrianos wrote in the letter to OREA president David Reid.

Syrianos expressed concern about the “Ontario Realtor Party,” an OREA campaign that, according to the provincial organization, supports “all political parties and politicians that support the Canadian dream of home ownership.”

He also expressed his discontent with OREA’s plan to use the campaign to endorse specific politicians on billboard advertisements — something he sees as a direct violation of his board’s mandate to promote policies, not people.

OREA is a provincial organization that represents members of Ontario’s local real estate boards, of which TREB is the largest. The Toronto chapter accounts for 50,000 of the 70,000 OREA members in the province.

The letter is dated May 7, just days before the writ was dropped in Ontario`s provincial election, to be held June 7. It also comes during the busiest real estate season of the year, one that is much slower in Toronto than the same time last year, after a number of since-implemented provincial and federal policies have had a cooling effect on the market.

Syrianos lambasted OREA for using members’ dues on the Ontario Realtor Party campaign without their knowledge or consent, and asked OREA for a breakdown of the costs.

In his letter, Syrianos detailed concerns about the recently launched OREA ad campaign, called “Keep the Dream Alive,” saying it is far too negative and suggests that the dream of home ownership is dying — pointing out it will have a particularly negative effect on the Toronto market.

“The negative tone reflected in the recently released commercial could have psychological consequences for consumers and could provoke further unwarranted negative government intervention,” he wrote, adding that he wants details on a $1-million media buy for the commercial in the fall, which coincides with Toronto’s municipal election.

“We expect that you will respect our wishes and OREA will not interfere during the fall municipal elections with similar advertising as local advocacy is the mandate of local boards,” he wrote.

The campaign comes at a particularly troubling time for TREB, which has estimated there were 32 per cent fewer home sales in the Toronto- area in April compared to the record highs recorded in same month last year. Home prices took a 12 per cent hit compared to the same month a year ago. That`s bad news for realtors, who earn commission from every sale.

In April 2017, the provincial government enacted measures that included taxes on vacant properties and a non-resident speculation tax, and the federal mortgage regulator introduced a new stress test for uninsured borrowers at the start of the year. Further adding to the chill, mortgage rates have been marching steadily higher since the beginning of the year.

Syrianos expressed concern that OREA is talking too much about the Greater Toronto Area, which he said is a domain best left to TREB.

He pointed out that the local board and provincial association recently discussed the roles of the local, provincial and federal organizations “to avoid mission creep, the duplication of services … and to ensure that all three levels of organized real estate ‘stay in their lanes.”‘

He said Hudak has “aggressively” pursued “speaking and media engagements” on the Toronto housing market, and has been meeting with and posting about specific brokerages in a perceived “endorsement campaign.”

“We once again request that you stop perpetually lowering the bar while at the same time demanding for it to be raised,” Syrianos wrote.

OREA and TREB declined to comment on the specifics of the letter in a joint statement, writing only that it is “not reflective of the long standing and positive relationship” between the associations, and that they hope to resolve the discussions “amicably and internally.”

Hudak could not immediately be reached for comment.

 


 

Is this a juicy story?

Or do some of you not even care?

Perhaps I’m only interested in this because I work in the industry, but I have to think this potential battle between OREA and TREB could have long-term implications.

Now while I’m not looking to take a “side” in this fight, I will offer a description of my own interactions with both OREA and TREB over the last year.

I’ve spoken with Tim Hudak multiple times since he took the role as CEO of the Ontario Real Estate Association, over email, phone, and in person.

I don’t know Mr. Hudak very well, but I will say that in my dealings with him, he seems to genuinely care about the problems that exist in real estate.

When he first took the role at OREA, he sought out top Realtors throughout the province to sit down and speak to them, to get to know what’s on Realtors’ minds.  I met with Mr. Hudak in early 2017, and we covered a variety of topics, all of which he seemed interested in.

Now where the overlap, and varying responses, between OREA and TREB get interesting is with respect to my now-infamous January, 2018 blog post:

“Realtor Stats: How Many Transactions Were Agents Doing In 2017?”

If you recall, I had access to a third-party database that tracked all licensed Realtors’ transactions, and I downloaded the data, and let the public know just how many, or how few, transactions Realtors were doing.

The response was overwhelming.

I had a dozen calls from media members, although to be honest, most just wanted to get their hands on the data.  Only a couple asked questions for stories that seemingly never hit print.

Mr. Hudak reached out to me after the blog was posted, and asked to chat.

I’m not looking to quote him in any way here, but he essentially asked why people were sensitive to the publication of this type of data.

We chatted, and again, I found him to be incredibly receptive, but above all – curious.

Don’t forget, the Ontario Real Estate Association used to handle education.  They don’t anymore.  So what can they do to fill that void?  In my opinion, they’re slowly becoming lobbyists.

Mr. Hudak genuinely seems to care about issues that plague organized real estate.

In my humble opinion, the Toronto Real Estate Board seems very concerned with the number of licensed Realtors.

When I wrote that blog in January, I was immediately told by multiple parties that “TREB did not like it.”

I’m not going to name names here.  I still have to protect myself, ensure I remain licensed and avoid putting a target (more of?) on my back.

But I will say that when my blog post was picked up by REM Online, (link here) I was told that there were “ongoing discussions” at TREB about my article.

I was never contacted by anybody from TREB about this blog post, in any way, shape, or form.  Everything I’ve heard is from people close to me, who are on committees or have other roles at TREB.

But I do know that once my blog post was picked up by REM Online, the third-party company that provided real estate agent statistics (who I won’t name) to whom I was a paying user, cancelled my account, and refused to renew it.

Around the same time, we had a company general meeting, and a member of TREB was present.

When asked about “the article,” that person said something to the effect of, “We don’t believe that article accurately portrays the average TREB agent.”

Correct.

It doesn’t.

Because the average TREB agent is far, far worse than that article could portray.

The average TREB agent is agent #25,000 out of 50,000.  And that agent does zero or one transaction per year, on average.

But I think I’ve already beat that dead horse.

My point is this: after having written that January blog post, I saw two very different reactions from our two real estate groups.

OREA seemed curious about what I had written, and why people were “so sensitive” about the subject.

TREB didn’t like it, and disagreed with it.

Now maybe I’m guilty of taking one experience, and jumping from reactions to ideologies.

But it’s all I really have to go on right now.

That, and TREB’s history.

Remember in 2015 when TREB sent a letter to its members, threatening to take their access to MLS away?  No?  Read about it HERE.

I’m not going to gain any favour with TREB by posting this blog, but what can ya do.

This story might have legs, and if it does, it’s hard to provide a “part two” if you never penned part-one in the first place…

23 Comments

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  1. lui says:

    Two edge sword with banks.You either renew the borrowers mortgage at a competitive rate with slight risk or let the customer use a mortgage broker at slightly higher rate and lose a customer.I highly doubt a bank would want to lose a long term customer because of the stress test.Treb is the cheerleader for the real estate industry.Every day is sunny and buyers have nothing to worry about.

  2. Appraiser says:

    FAKE NEWS: In fact 47% of mortgages will NOT renew this year. Bank of Canada clarifies.

    “As for renewers this year, “Our staff estimates that roughly 25% of mortgages will be renewed this year, in line with historical norms,” says Bank of Canada spokesperson Josianne Ménard.” https://www.ratespy.com/47-of-mortgages-will-not-renew-this-year-05116120

    1. Chris says:

      Oh, here, appraiser, you seem to have forgotten part of the quote, let me help you out!

      “The 47% figure highlighted in Chart 4 of the November 2017 edition of the Financial System Review refers to the percentage of mortgage holders who would face higher rates in the next 12 months if rates were to increase,” Ménard adds. “In addition to households renewing their mortgage, this includes households with a variable rate mortgage (who are not renewing their mortgage in the next 12 months).”

    2. Kyle says:

      @ Appraiser

      Oops, turns out it is going to be a typical mortgage renewal year after all.

      1. Professional Shanker says:

        the 47% never made intuitive sense and most people I suspect ignored that figure when it was broadcasted across MSM. That said when rates are increasing and the expectation of such increases are widespread, more homeowners will lock into a fixed rate product, so this year should represent a higher amount of renewals but no where near 47%!

        1. Kyle says:

          I agree the 47% figure seemed odd to me. Over the last couple of years there has been an expectation of rate hikes. I recall when i was renewing the rates on the shorter terms did not seem discounted at all relative to rates on 4 and 5 years terms.

          So it would have been unlikely to me that anyone renewing in the last couple of years would have chosen a 1 or 2 year term (i.e. a term coming due this year).

    3. Ralph Cramdown says:

      The (erroneous?) report was out of CIBC, not a notable bears’ lair. Their explanation was that some recent purchasers had stretched to qualify using shorter terms, so renewals were now piling up. This seemed plausible to me. National Bank responded that BoC didn’t see it that way, and somebody (Ratespy?) got a BoC quote. N.B. Estimating that this year will be the same as last year is what you do when you don’t have any data. Sadly, I suspect that the BoC has no data on outstanding mortgage terms.

      Maybe CIBC used data from its own book? The mortgage brokers say that CIBC has been the most aggressive A lender for marginal deals, so it wouldn’t surprise me. I’m joking,but not really. Maybe the analyst just misinterpreted the BoC graph? I looked at Will Dunning’s latest mortgage survey, but it offers no insight.

      Anyway, at this point I suspect CIBC doesn’t know and the BoC doesn’t know either. Even if they did, their stats only cover federally regulated lenders, not credit unions or private money. It does bother me how little we know about our own economic numbers. Compared to elsewhere (E.g. St. Louis Fed’s FRED, Eurostat &c.), our stats look pretty bush league.

      This applies to our employment stats, too. The latest headline numbers were pretty crappy, but, given the large margin of error, one month’s worth of Canadian employment data signifies almost nothing. Maybe they were good? Tune in next month for more of the same…

    4. Housing Bear says:

      Well that might throw off my timeline a little bit then in regards to whether or not we will be able to tell how much financial ruin there is by the end of the year.

      Could actually be worse for households though. Felt like the BOC was trying to hold rates down to allow as many people to renew as possible. (even though bond yields play a larger roll in determining fixed mortgages). Guess a much larger share of the pie will have to renew after rates are hiked another 2-3 times this year.

  3. Parkhurst.bessborough says:

    It’s important that you wrote about this. I agree that it’s ballsy of you to weigh in…..😁
    People who follow real estate will appreciate your honest view.

  4. Katie says:

    You are right, nobody cares.

    This won’t affect the general public.

    Let’s see more funny photos!!!!!

    1. Paully says:

      I’m with Katie. If TREB and OREA ate their young, nobody would care.

      1. BJA says:

        And that’s part of the problem (well, for those of you who feel there is a problem).

  5. RPG says:

    David, what would happen if you did provide names and specifics? What would be wrong with doing that? I’m just curious to know: could TREB take your license away for speaking out of turn? For not towing the company line, so to speak? Isn’t that anti-competitive? Do you know what the repercussions could be? Or do you just not want to find out?

    1. Rachelle says:

      Actually the consequences could be very dire, the different real estate boards have no problem whatsoever shutting down websites and brokerages. Worst case scenario, David could have his license suspended and access to MLS revoked, and he could have the joy of fighting it in the courts while trying to avoid bankruptcy due to legal fees and lack of income. TREB and CREA and OREA have deep pockets and a long memory. He’s right not to whack that particular wasp’s nest.

      1. Active Agent says:

        Sorry Rachelle but you’re out of your depth on this one.

        TREB isn’t the mafia. They won’t just take somebody out of business for something they said.

        The only offence that can actually get a licence taken away is stealing money. Either from a trust account or from a client.

        Providing an opinion on the efficiently and mandate of a board that a member is apart of is hardly grounds for termination.

  6. joel says:

    If it was a former Liberal party leader using OREA money to boost their party I think we would see a very whinny post about it and how outrageous and inappropriate it is. I think TREB is in the right here as they are looking to protect their agents.

    1. jeff316 says:

      Agreed.

      1. XYZABC says:

        Agreed….I like David and his work, but….i am sure he would be tearing into the Liberals for this.
        I also think, Tim Hudak might have managed David very delicately, and astutely here and sold him at least some of the kool aid,

        1. Batalha says:

          100% agree. David pretends to be “apolitical” but he’s obviously a dyed-in-the-wool Tory at heart (“not that there’s anything wrong with that”…well, actually, sometimes there is…).

  7. Andrew says:

    You have guts, David. I’ll give you that!!

  8. Marina says:

    It’s like any other multi-tier type organization – the lower down you go, the more petty and sometimes batshit crazy things get. Present US Federal government excepted, of course.

    But the response is kinda obvious. I mean, TREB is perfectly happy pocketing the dues of all those agents, regardless of what it’s doing to the industry. How shocking! said no one ever.

  9. Carl says:

    How are TREB and OREA executives chosen? Do members have any voice in deciding who will speak for them in the media?

  10. Ralph Cramdown says:

    So TREB writes a poison pen letter and then “leaks” it to a reporter? Knowing that the story that comes out of it isn’t exactly going to be flattering or put positive spin on the GTA market’s ongoing misery? Must be looking to demonstrate to TREB members that TREB is getting things done. But it’s odd — while Hudak may or may not be looking for a promotion up and out of OREA (lots of opportunities likely opening up in June for an old public sector hack), TREB execs usually do their year and go back to their brokerages, no?

    Why not ask Mark McLean about the likely mood inside TREB? Are you still allowed to talk to him since he’s left Bosley’s bosom?

    And about that company that cut off your data access… Have you considered filing a competition action against them? Because let’s face it — they could’ve cared less that you posted the blog. But they got a call from TREB, looking to deliver a horse’s head, or at least stick a spoke in your wheels. Subpoenas of those communications and depositions of the parties involved would paint an unflattering portrait, to say the least. Not that you’ve got the time or inclination to spend $100k on a lawsuit, I’d imagine. But the threat of one often works wonders if all you’re looking for is to get your account restored. Or maybe just open a complaint with the competition bureau and let them do the lifting — they’re already pretty familiar with the file.

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