Rob and Greg return with some news from north of the border and a discussion regarding what the real estate industry in the states might learn from recent regulations imposed in British Columbia.

Rob explains the dysfunction in the Vancouver housing market that led to disreputable behavior on the part of some realtors and the public outcry that followed. He and Greg also debate the likelihood of something similar happening here in the US. Listen in to understand the parallels between the systems in Canada and the US and how leadership in the industry could prevent an analogous government intervention here.

What’s Discussed: 

The similarities between the Canadian and US systems

The Trump administration’s position on regulation

Why regulations are more likely to be imposed on a state (rather than federal) level

The impetus behind the public outcry in British Columbia

• Simmering resentment over a high price-to-income ratio in Vancouver
• The rampant practice of shadow flipping

Why the standard form contract clause allowing a buyer to assign the contract to someone else without seller approval was added initially

How price fluctuations in the Vancouver market led to the practice of shadow flipping

Why government intervention is rarely precision reform

How British Columbia changed the way the regulatory body works

• The Real Estate Council had been comprised mostly of realtors appointed by local realtor associations
• Industry representatives can only account for 50% of the council membership now
• A newly appointed Superintendent of Real Estate has been given much power

The steep fines agents and brokerages face if found in violation

The likelihood of a similar phenomenon happening in the US

• Six of the top ten most dysfunctional markets in the world are in California
• Though the practice of shadow flipping is unlikely here, other dysfunctional business behavior (i.e.: pocket listing) is probable

How the real estate industry could maintain its privilege to self-regulate

• Include non-industry representatives on real estate commissions
• Improve the process of enforcing the code of ethics
• Make an effort to protect the consumer

 

Resources:

2017 Trends Report

The Globe and Mail Expose

 

Connect with Rob and Greg:

Rob’s Website

Greg’s Website