MODULE I:
THE REAL ESTATE PROFESSION
Today was like any other day for most Ontario residents and certainly Torontonians. Commuters dutifully trekked
b__per-to-b__per down the 404 toward the Parkway. Near Bathurst, a fender bender was forcing anxious drivers to seek
alternates on the westbound 401. The airport area was relatively quiet with traffic spotters reporting a quiet morning.
Eastbound 401 travellers had open roadat least by Toronto standards. The trip across the city was surprisingly uneventful.
With visors strategically positioned, sun-glassed drivers exited at Leslie Street with near-military precision. Traffic lights, a
sharp turn, the next left to Duncan Mill Road, and the OREA sign was in sight.
An 8:00 a.m. early-bird crowd was mingling, sipping coffee and exchanging pleasantries. New arrivals chatted briefly,
gazing expectantly at the soon-to-be unlocked main doors. Unmistakable excitement, mixed with caution, was in the air.
Real estate classes would begin shortly.
Meanwhile, Huntsville was just waking up to a crisp, fall morning. A
hesitant, mid-fifties home owner momentarily stared down the street from
her kitchen vantage point, as if pondering what to do next, then anxiously
ripped open the box spilling books and course materials over the tiny table.
In London, another peered into the mail box. Yes, it had arrived. Still
another took a final fleeting look at the Ottawa skyline, typed in
other day except for those seeking opportunities. Today, for them, was the
beginning of a life-long adventure. Welcome to the world of real estate!

A CAREER IN REAL ESTATE

The development of real estate brokerage in Canada parallels the growth of the nation.
Brokers, acting for the English at Annapolis Royal in Nova Scotia in 1604-05, then the
French at Quebec City and Montreal, were the first to apportion land for permanent
holdings in Canada. Early colonial governments of both Upper and Lower Canada appointed
brokers for the distribution of land for permanent settlement. The Hudson Bay Company
employed qualified persons in what today could be identified as real estate transactions.
As Canada grew, so did real estate ownership and the brokerage tradition. Territorial
governments of what are now the prairie provinces named brokers in the late 1800s. Soon,
real estate brokers and salespersons were pursuing their livelihood throughout the nation.
Today, as in past centuries, real estate property holdings and development are vital to the
growth and prosperity of this country. Real estate practitioners in Ontario have, and
continue to make, an important contribution to that process.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Session Guide
SESSION GUIDE
THESE TOPICS ARE COVERED IN THIS SESSION:
REAL ESTATE: A VITAL PART OF OUR SOCIETY
An Ontario Portrait
Real Estate: A Prominent Role
THE CAREER OF A LIFETIME
Specialty Fields
Preparing for Today's Buyer
THE SALESPERSON'S ROLE
Legal Responsibilities
Defined Roles/Authorities
Salesperson/Broker Relationships
Listing/Marketing Activities
COMMISSION SALES & COMPENSATION
Commission
Commission Sharing: Distributions,

Allocations, and Splits
Compensation Terms
KNOWLEDGE INTEGRATION
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Learning Outcomes
LEARNING OUTCOMES
AT THE CONCLUSION OF THIS SESSION, STUDENTS WILL BE ABLE TO:
Briefly outline the importance of real estate activity from national and
provincial perspectives.
Detail key career expectations, opportunities, and the specialty fields.
Outline the salesperson's legal responsibilities, status as an employee vs.
independent contractor, and typical listing/marketing activities.
Perform selected commission calculations involving listing and selling
commissions.
Detail prevalent commission calculation and commission sharing methods
involving one or two brokerages.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Real Estate: A Vital Part Of Our
Society
REAL ESTATE:
A VITAL PART OF OUR SOCIETY
Land ownership is of paramount economic, social and political importance in Canadian society. A real estate purchase is a
significant lifestyle decision and constitutes the largest single element of most people's personal wealth. Corporate
acquisitions reach into the billions, as companies acquire large retail commercial and industrial facilities, utility companies
consume countless miles of rights-of-way, farming involves thousands of hectares, and residential developers routinely
construct thousands of homes annually.
Real estate is also integral to social and political order. Civil law enshrines real property ownership rights, while federal and
provincial statutes reaffirm and regulate such rights. Owners of real property enjoy advantages over the non-owner, e.g.,
credit is often more freely granted to those who own their own property. Most important of all, shelter is a necessity for all

Canadians. How real estate is developed and what shape new communities take, directly affects the very fabric of society,
the quality of life, and our livelihood. Within these dynamics, real estate salespersons and brokers prudently go about their
business. Few things happen without real estate. Little wonder that many seek the opportunity to guide others in its
purchase and sale.
AN ONTARIO PORTRAIT
Real estate is big business in Ontario. During the year 2000, for example, total dwelling units topped 4,300,000 with
approximately 58% being single-family homes. According to Statistics Canada, Ontarians are big boosters of home
ownership, with 64% being owned properties, as opposed to rental accommodation. Clearly, an ample market exists for
anyone willing to work toward a successful real estate career.
Those seeking specialty fields will discover an expanding commercial and industrial marketplace. For example, the value of
non-residential building permits increased 45% over the period 1997 - 2001. Commercial construction currently accounts
for 50%, with industrial at slightly more than 20%. The balance consists of institutional and government sector activity.
Opportunities continuously unfold for those who professionally service these market segments.
Ontario not only represents the backbone of Canadian economics, but is directly in step with the expanding high tech world.
Over 64% of all households were connected to the Internet in 2002 (as opposed to 33% five years ago). In terms of
venture capital (an indicator of the commercializing of new technologies and ideas), Ontario ranks highest in Canada both in
total dollars invested and dollars per capita. Even more important, Ontario wage earners in 2001 led all provinces in
exceeding the national average by a full 7% and its nearest rival by 4.2% (Alberta). Little wonder that real estate thrives in
this expanding, productive environment.
ONTARIO BUILDING PERMITS: TOTAL VALUE
(Source: Statistics Canada, CANSIM II Table 026-0003)
MARKET MEMO
THE EXTENDED GOLDEN HORSESHOE
Over 6.4 million of Ontario's total residents now reside in the extended horseshoe reaching from Oshawa to Niagara Falls,
including areas north to Richmond Hill and west to Kitchener- Waterloo. Twenty-two out of every 100 Canadians now live in
the horseshoe. Almost one-half of all the population growth in Canada occurred there since the last census (1996). Little
wonder that residential condominium developments are re-shaping the Toronto skyline, as young adults flock to
metropolitan areas. But moving goes beyond the young. Ontarians are generally mobile, given that over 40% packed their
bags and relocated during 1996 - 2001. Combine growth statistics with mobility and a dynamic real estate mosaic
emerges... a patchwork of differing needs, households, and economic capabilities that must be continuously addressed by
real estate professionals.

Source Statistics Canada, Census 2001 Summaries.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 A Prominent Role
REAL ESTATE:
A PROMI NENT ROLE
Real estate is typically in the foreground when evaluating economic performance. Those in the know constantly track the
ups and downs of building permit volumes, given their widely accepted status as key economic/market indicators. Rising
numbers typically point to increased capital flowing to construction, reflecting economic growth and business confidence.
Those same numbers also foretell of improving job prospects, heightened demand for services (including real estate
salespersons and brokers), and broad community based economic benefits.
start creates the equivalent of 2.8 jobs for a full year. But, be careful in interpreting building permit information in a sales
career. Remember, several months may pass before actual construction and cash flows begin. Also, one large project may
distort overall trends. Regardless, the impact of real estate is massive particularly when resales are added to the equation.
HOUSING FOCUS
THE RIPPLE EFFECT
Salesperson Lane meets Mr. and Mrs. Smith at the open house in Windfield Crossing, scant yards from framers, plumbers,
and other trades busily completing new homes. Three months ago, pasture and neatly s___ed survey stakes were all that
greeted passers-by. With a simple 'yes' and signing on the dotted line, the Smiths have unwittingly fired the economic
engine, as so many others have done before. The ripple effect begins:
Building tradespeople to construct the home.
Future tax revenue for the municipality.
Profits and return of capital for the developer.
Profits and cash flow for the builder.
Additional consumers for the local marketplace.
Commissions owed to the real estate brokerage and salespeople.
Fees for lawyers, mortgagees, and others involved in the sale/closing.
Fees for other experts (inspectors, appraisers, and surveyors).
But the story doesn't end there. Research suggests that the housing sector accounts for a significant component of the
national economy. New home buyers typically spend an additional 20 - 40 cents for every dollar invested in a home. For
example, a new home selling for $200,000 in Windfield Crossing could generate an additional $40,000 - 80,000 in needed
services (landscapers, decorating, draperies, outside improvements, appliances, etc.).

The ripple extends even further. Ongoing maintenance is an economic fact of life. That same
property will necessitate ongoing home related services over the years, as it forms part of the
resale housing stock. The most popular include carpet cleaning, painting, plumbers, electricians,
cleaning services, and roof repairs.
Real estate salespersons help make the economy happen. Just a simple signature starts the
ripple effect that lasts for years and years.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Career Of A Lifetime
THE CAREER OF A LIFETIME
Personal determination and commitment are vital in an increasingly refined and
complex consumer marketplace. Both challenges and rewards await those who enter
this profession. Personal sacrifices are a reality in a business well known for long
hours. Real estate is a 24/7 event driven by consumers and the unending ebb and
flow of market negotiations.
Today's professional is more tech-savvy than his/her counterparts of the last decade.
Sophisticated property databases, electronic transactions, and the power of the
Internet have enveloped the marketplace.
Successful real estate salespersons are people-oriented and their impact is far
reaching, i.e., from families seeking the ideal neighbourhood to investors uncovering
hidden cash flow opportunities. Effort typically brings financial rewards, but caution is
emphasized. Money management is key as earnings can vary dramatically.
Information is power in today's marketplace. Successful salespeople keep in step
with the newest ideas and techniques, the latest market data, and the most up to
date information on changing trends, legislation, and marketplace dynamics. In
Ontario, real estate is a happening that never ends.
SPECIALTY FIELDS

While residential sales constitutes the bulk of Ontario real estate
activity, many fields provide abundant challenges and
opportunities. Eight popular specialities are highlighted.
However, the demand for expert knowledge goes well beyond
these to government services/consulting (ministries, agencies,
and municipalities) large corporations (banks, trust companies,
insurance companies, and utilities), developers with extensive
land holdings, real estate franchises, investment syndicates, real
estate investment trusts, and multi-residential and commercial
landlords.
MARKET MEMO
MATCHING YOUR SKILLS
PREPARING FOR TODAY'S BUYER
Where do listings and sales come from? For new salespersons, a
sphere of influence is key. Research suggests that more than 50%
of sellers select a salesperson based on prior contact with that
individual or a referral to that person from a friend, acquaintance, or
relative who was highly satisfied with service provided.

Becoming known and respected are long term goals of every
successful salesperson. Advertising is also an essential component.
For sale signs, newspaper advertising, and the Internet are the
most widely used marketing tools.
Expect long hours, as most buyers want to inspect various houses
prior to making a decision. Obviously, time spent searching is
usually dictated by market dynamics. The more available properties;
the more time to point of decision. Conversely, strong seller
markets and limited listings make for motivated buyers and
shortened decision making.
CURIOSITY
INSIGHTS FOR YOUR NEW CAREER
What do the typical buyers do these days? The National a__ociation of REALTORS (USA) conducts periodic buyer/seller
surveys. Here's a few facts to consider:
Forty-two percent of homebuyers purchased their first home in 2001.
Buyers typically took seven weeks and visited 10 homes prior to making the buying decision.
Forty-one percent of homebuyers used the Internet as an information source.
Over 50% of homesellers selected a salesperson based on previous contact with that individual or upon a referral
from a friend, relative, or another broker.
Source The 2002 National a__ociation of REALTORS Profile of Home Buyers and Sellers, National a__ociation of REALTORS,
STUDY LINKS
Residential Resales
New Home Sales
Condominium
Condominium - Overview

Rural, Recreational, and Agricultural Sales
Property Management Specialty
Appraisal Specialty
Mortgage Financing - Specialty Field
Commercial Sales
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Salesperson's Role

THE SALESPERSON'S ROLE
Today's real estate brokerage represents the culmination of tried and true practices, combined with continuous innovations
to better serve the buying and selling public. While common law has established the legal role, legislation has refined the
responsibilities concerning real estate trading.
LEGAL RESPONSIBILITIES
DEFINED ROLES/AUTHORITIES
A brokerage may be a corporation, partnership or sole proprietor (individual).
Brokerage is not formally defined in the Act, but generally refers to the business, i.e., a corporation, partnership (few
partnerships are registered under REBBA), or sole proprietorship operating as a broker. In the case of a corporation,
the brokerage and the broker(s) operating that corporation must be registered.
An a__ociate broker is also not formally defined in the Act, but is an individual who is registered as a broker, but
employed by another broker in a salesperson capacity.
A branch office manager may be a broker or a salesperson who meets specific criteria set out in the Act to perform in
a management capacity.
SALESPERSON/BROKERAGE RELATIONSHIPS

A TYPICAL REAL ESTATE BROKERAGE
Relationships between the employing brokerage and salespersons/a__ociate brokers can involve employee or independent
contractor status. With an employee, a contract of service exists.With an independent contractor, a contract for service is
created. Independent contractor agreements are generally more lengthy documents given detailed contracted duties and
responsibilities.
Regardless of whether the salesperson is an employee or independent contractor for
taxation and other regulatory considerations, he/she is only authorized to trade on
behalf of a broker and is viewed as an employee for purposes of the Real Estate and
Business Brokers Act as well as requirements set out by the Real Estate Council of
Ontario.
LISTING/MARKETING ACTIVITIES
Activities can be broadly grouped under seven components. Perspectives and duties vary based on the agency relationship
(e.g., buyer, seller or dual agency), the broker/salesperson relationship (employee or independent contractor), and the
specialty (residential or commercial).
THE RESIDENTIAL TRANSACTION

CAUTION
CANADA REVENUE AGENCY (CRA) GUIDELINES
The CRA has common law principles to determine employee/independent contractor status. Seek expert advice on all
Tests Leading to Individual Contractor Status
STUDY LINKS
Agent
Broker
Master/Servant
Independent Contractor
Listing/Marketing (Residential Property)
Brokerage Management
Employment Contractâ€"Salesperson
Forms
Broker-Salesperson Employment Agreement
Independent Contractor Salesperson's

Agreement
Guide to REBBA (2002)
Go to the A to Z Search (first tab) and look up:
a__ociate Broker
Branch Office
Broker
Brokerage
Broker of Record
Salesperson
Trade
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Commission Sales and Compensation
COMMI SSION SALES
& COMPENSATION
Real estate sales has many benefits, not the least of which is the potential for a worthwhile income.
COMMISSION
Most brokerages compensate salespersons by sharing commissions, typically involving a percentage of the sale price.
Commission is most commonly a__ociated with listing and selling activity, but may also include non-selling activities, such
as property management and appraisals, or buyer/seller referrals to other brokerages.
COMMISSION SHARING:
DISTRIBUTIONS, ALLOCATIONS, AND SPLITS
Commission sharing methods can vary significantly. Salaries or other compensation
arrangements are possible, but rarely found today in Ontario. Typically, commission
dollars received are allocated between listing and selling portions with a subsequent split
between listing and selling salespersons. When two brokerages are involved, funds are
distributed between listing and selling brokerages, who then subsequently split
commission with their respective salespersons.
COMPENSATION TERMS
Commission splits can vary by employment or independent contractor agreement. Some offer a yearly plan with
increasing salesperson splits as an incentive for higher levels of production. Others offer a high split (e.g., 90% or higher of
total commission), but require a significant salesperson contribution toward brokerage expenses and/or a monthly desk fee
paid by the salesperson. Still others require an equal commission sharing (i.e., 50/50) until a stipulated number of
transactions or dollar volume is attained, with the balance for each year at a higher split (in favour of the salesperson).
Differing compensation terms may be found among salespersons within the same brokerage. Regardless of the
arrangement, salespersons are typically responsible for all personal expenses including automobile maintenance etc.

COMMISSION FOCUS
ONE BROKERAGE INVOLVED IN COMMISSION
Total commission is received by brokerage and allocated between listing and selling portions (e.g., 50/50). The applicable
portions are then split with listing and selling salespersons according to contractual arrangements (e.g., listing salesperson
contracted for a 50/50 split; selling salesperson for a 70/30 split).
TWO BROKERAGES INVOLVED IN COMMISSION
Total commission is received by listing brokerage and distributed between listing and selling brokerages. (Note: The term
distributed is used to differentiate from allocation within a brokerage). The applicable portions are then split with their
respective listing and selling salespersons according to contractual arrangements (e.g., in this instance, the listing
salesperson contracted for a 60/40 split and the selling salesperson for a 90/10 split).
COMMISSION SCENARIOS (SIX OF MANY)

Brokerage ABC Realty Inc. XYZ Real Estate Ltd.
Salesperson Lee Garcia Martin Ward
1
Listing
Selling
2
Listing
Selling
3
Listing
Selling
4
Listing
Selling
5
Listing
Selling
6
Listing
Selling
STUDY LINKS
Commission
Commission Plans
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Knowledge Integration
KNOWLEDGE INTEGRATION
NOTABLES
Real estate is a significant factor in both the Ontario and Canadian economies.
Real estate development and construction has a ripple effect that flows through the local economy.
Be prepared for long hours and considerable effort.
Various market opportunities are available to those who want to pursue specialties.

Both common and statutory law impact how agents conduct themselves in the marketplace.
The Real Estate and Business Brokers Act sets out duties and responsibilities for brokers and salespersons registered
under that Act.
While a salesperson has the option of being an employee or an independent contractor, all salespersons under the
Real Estate and Business Brokers Act are deemed to be employees for purposes of the Act.
Commission arrangements vary both between and within real estate brokerages.
Terminologies regarding commission calculations are not standardized, but generally involve a distribution of
commission between listing and selling brokerages, the allocation between listing and selling components, and the
splitting of commission between brokerage and salesperson.
Compensation for salespersons typically arises from listing and selling activity by way of commissions, but can also
be generated by non-selling activities and referrals.
GLOSSARY
Agency
Agent
a__ociate Broker
Broker
Brokerage
Commission
Commission Sharing
Commission Split
Employee
Independent Contractor
Principal
Real Estate
Real Estate and Business Brokers Act
Salesperson
WEB SCANS
Click on Accessing Your Government, then Ontario Ministries.
Search Independent Contractor.
STRATEGIC THINKING
1. What training do I need to become more tech-savvy?
What specific activities will a__ist in acquiring saleable listings once I am registered as a real estate salesperson in
the Province of Ontario?
2.

What specialty fields are appealing and is there sufficient activity in those fields to focus my activities within the local
marketplace?
3.
Based on information provided to this point in the course, my skills appear best focused on listing and/or selling
activities.What additional activities should I undertake to improve those skills?
4.
What compensation plans and other benefits/features are available with brokerages that operate in my local
marketplace?
5.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Mini-Review

MIN I -REVI EW
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Review Topics

REVIEW QUESTIONS
This is a Self-a__essment; your answers will not be scored.
View the question, then click your mouse inside the text box and type in your answer. The "Solution" b___on will appear.
When you have finished, click on the "Solution" b___on to compare your response to the model answer.
There is only 1 question in this review.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 1 of 3 Exercise Preparation
EXERCISE PREPARATION

QuickLinks cannot be displayed using compile for print.

a__ociations
PROFESSIONAL a__OCIATIONS
Professionalism is firmly rooted in real estate history. In 1912, an international
gathering of real estate experts convened in Winnipeg, producing a Code of Ethics for
practitioners in the United States and Canada. Portions of that original document
remain entrenched with today's real estate a__ociations. That same meeting
advanced the idea of licensing law for all jurisdictions, a concept that has stood the
test of time. Regulators and professional organizations are now the foundation of our
industry. This time-honoured bond is no better evidenced than in the strong working
relationship between the Ontario Real Estate a__ociation (OREA), real estate boards,
and the Real Estate Council of Ontario (RECO).
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Session Guide
SESSION GUIDE
THESE TOPICS ARE COVERED IN THIS SESSION:
ORGANIZED REAL ESTATE
National Organization
Ontario Beginnings
New Directions
The Three-Way Relationship
PROFESSIONAL a__OCIATIONS & BOARDS
Ontario Real Estate a__ociation
Real Estate Boards
MLS Services

THE REAL ESTATE COUNCIL OF ONTARIO
Other Professional Organizations
KNOWLEDGE INTEGRATION
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Learning Outcomes
SESSION 2 :
LEARNING OUTCOMES
AT THE CONCLUSION OF THIS SESSION, STUDENTS WILL BE ABLE TO:
Briefly describe the development of organized real estate, the three-way
relationship between boards, the Ontario Real Estate a__ociation, and The
Canadian Real Estate a__ociation (CREA).
Outline the ongoing interrelated roles of CREA, OREA, and real estate
boards along with international affiliations.
Detail the governing structure of the Real Estate Council of Ontario with
particular emphasis on vision, mission, and services.
Differentiate between organized real estate and RECO concerning roles and
services provided.
Describe briefly selected professional organizations that offer expertise in
selected specialty fields.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Organized Real Estate
ORGANIZED REAL ESTATE
NATIONAL ORGANIZATION
On February 2, 1943, The Toronto Telegram proudly announced: Canada-Wide Real Estate
Body Formed. Organized real estate, as we know it today, took on national stature with the
creation of the Canadian a__ociation of Real Estate Boards (CAREB). In truth, the work began
much earlier. The first real estate board appeared on March 4, 1888 in Vancouver. However,

that board disbanded for several years, leaving the Winnipeg Real Estate Board (formed in
1903 as the Winnipeg Real Estate Exchange) with the distinction of being the oldest,
continuously operating board. Real estate boards provided the foundation for
provincial/territorial and national organizations.
Sixteen boards formed CAREB's charter membership (reorganized into The Canadian Real
Estate a__ociation (CREA) in 1971), which currently boasts 114 real estate boards across
Canada and approximately 66,000 members. Many more boards formed with the post-war
boom in real estate, as the role of real estate practitioners took on a focal position in
communities throughout the nation.
ONTARIO BEGINNINGS
The first real estate board was formed during 1918 in Ontario. Debate continues to this day as to whether the Thunder Bay
Real Estate Board or the Windsor- Essex County Real Estate Board holds claim to that achievement. The Toronto Real
Estate Board was formed in 1920, with the Ontario a__ociation of Real Estate Boards (OAREB) following two years later on
Dec. 7, 1922. The a__ociation actively lobbied for the first Real Estate Brokers Act, which was passed in 1930. In the early
1950s, a regional structure (five regions in total) were set out as part of a major reorganization involving both the real
estate boards and OREA.
By the early 1970s, the membership had swelled to 20,000, with OAREB renamed as the Ontario Real Estate a__ociation in
1972. Ten years later, OREA welcomed the 48th real estate board into organized real estate in Ontario. In 2003, OREA
reported a total membership of over 31,000.
NEW DIRECTIONS
In 1997, a long-held OREA commitment to self-regulation was realized with the formation of the Real Estate Council of
Ontario (RECO). RECO oversees all regulatory matters regarding the Real Estate and Business Brokers Act, as well as
registration processes, professional standards enforcement, and consumer protection programs.
Another milestone was reached in 2003 with the formation of the OREA Real Estate College. The College is the latest
innovation in OREA's continuing education role, which began with the introduction of formal real estate education courses in
1965.
THE THREE-WAY RELATIONSHIP

National a__ociation
The Canadian Real Estate a__ociation (CREA), provincial/
territorial a__ociations, and real estate boards make up the
three-way relationship. CREA, located in Ottawa,
concentrates on federal issues and a__ociated lobbying, as well
as international representation. Often referred to as the voice of
Canadian real estate, CREA is responsible for various trade
marks and certification marks a__ociated with member services,
the most notable of which are REALTOR and Multiple Listing
Service (MLS).
Provincial/Territorial a__ociations
The Ontario Real Estate a__ociation is one of ten provincial
a__ociations and one territorial a__ociation that serve members
across the nation. Typically, as with OREA, provincial
a__ociations provide education (registration and continuing
education courses), and various member-related services.
Real Estate Boards
Real estate boards operate in defined jurisdictional areas offering MLS services and other member services. Members rely
most directly on boards in their day-today activities. The scope of duties will vary based on overall provincial structure and
the size of individual board memberships. Forty-three real estate boards are currently operating in the province, the largest
in terms of membership being the Toronto Real Estate Board.
FOCUS
SPANNING THE GLOBE
Organized real estate boasts international connections. Technology is transforming how real estate is transacted on a global
scale. Routinely, throngs of internet-savvy buyers and investors comb web sites provided by organized real estate. In
over 1.5 million properties.
NAR, the world's largest trade organization, has created an alliance network around the globe consisting of 54 national and
regional co-operating a__ociations (including CREA). Further, its CIPS (Certified International Property Specialist) network,
an outcropping of that initiative, has over 1,400 members focusing on international markets, a__istance to foreign
investors, investment abroad, and the servicing of local ethnic niche markets.
STUDY LINKS

Canadian Real Estate a__ociation
Organized Real Estate
Provincial / Territorial Real Estate a__ociations
Real Estate Board
Multiple Listing Service
REALTOR
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Professional a__ociations and Boards
PROFESSIONAL
a__OCIATIONS & BOARDS
ONTARIO REAL ESTATE a__OCIATION
The Ontario Real Estate a__ociation (OREA), a well established member services organization, is
best known for its focal role in education through the OREA Real Estate College, member
publications, provincial lobbying, research, standard forms, and other products sought by
members. OREA also provides expertise to real estate boards including arbitration services.
REAL ESTATE BOARDS
Real estate boards, while widely recognized for their role in managing the local MLS service, are also extensively involved in
local public relations, grants and donations, promoting real estate ownership, continuing education programs, and
supplies/services to their members.
ONTARIO REGIONS AND BOARDS

MLS SERVICES
The Multiple Listing Service (MLS) provides for the
orderly co-ordination and dissemination of listing
information. This powerful tool, operated by local boards
in Ontario, has experienced tremendous growth since its
inception as Photo Co-op over 50 years ago.Major
benefits include wider property exposure, greater
marketing access and selection, and centralized
information.
The Commercial Listing Service (CLS) was launched to
complement the residential-based MLS service in 2002.

CURIOSITY
TRACKING THE INTERNET CONSUMER
MLS services are expanding dramatically on the Internet, improving both practitioner and consumer access to real estate
information. Residential and commercial systems offer immediate access to cross-Canada listings uploaded by the national
network of real estate boards. CREA publishes updated statistical information on a regular basis, for example:
Over 14.8 million detailed feature sheets viewed in one month (Dec. 2002).
In one month, over 780,000 unique web site visitors (18 years and older) used the web site (Sept. 2002).
Source CREA & ComScore Media Metrix Canada
STUDY LINKS
Provincial Reference Manual
OREA / RECO
Ontario Real Estate a__ociation
OREA - Historical Sketch
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 The Real Estate Council of Ontario

THE REAL ESTATE
COUNCIL OF ONTARIO
The Real Estate Council of Ontario (RECO) is a not-for-profit organization, formed in 1997 to administer the Real Estate
and Business Brokers Act on behalf of the Ontario government. Operating funds are derived from registration fees. All
registered real estate brokers and salespersons are regulated by the Act. RECO’s mandate is to protect consumers
through a fair, safe, and informed marketplace.
various regulatory councils and commissions involved with licence law across Canada and the United States.

OTHER PROFESSIONAL ORGANIZATIONS
Various organizations focus on specialty areas on provincial, national, and international levels, ranging from buyer agency
councils to shopping centre specialists. Many offer specialized training and real estate designations. Four a__ociations are
highlighted given their longstanding relationship with organized real estate in Ontario.
Click on the website addresses below to view the areas of focus.

STUDY LINKS
Encyclopedia
License Law
Real Estate Institute of Canada
Appraisal Institute of Canada
CCIM Institute
Society of Industrial and Office
Relators
Designations
Provincial Reference Manual
OREA / RECO
Real Estate Council of Ontario
GUIDE TO REBBA (2002) A to Z Search:
Registrar's Complaints and Inquiries (RCI)
Process
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Knowledge Integration
KNOWLEDGE INTEGRATION
NOTABLES
Organized real estate dates from the late 1800s with a national organization, now known as The Canadian Real

Estate a__ociation, formed in 1943.
The first Ontario board appeared in 1918; the provincial a__ociation was formed four years later.
CREA, provincial a__ociations, and real estate boards operate by means of a a three-way relationship.
MLS has grown since the 1950s into a powerful marketing system that offers numerous benefits to buyers, sellers,
and real estate practitioners.
Approximately 85% of all registrants in Ontario are members of local real estate boards, OREA and CREA.
The Real Estate Council of Ontario oversees regulatory matters and other activities centred on registration, consumer
protection, compliance, and professional standards.
Organized real estate and RECO perform differing, but complementary roles, in relation to real estate registrants.
Various national and international organizations offer products/services to specialty fields within the profession.
GLOSSARY
Canadian Real Estate a__ociation (CREA)
License Law
Multiple Listing Service (MLS)
Ontario Real Estate a__ociation (OREA)
Organized Real Estate
Real Estate Board
Real Estate Broker
Real Estate Council of Ontario (RECO)
REALTOR
Three-Way Relationship
WEB SCANS
Appraisal Institute of Canada (Ontario a__ociation)
Canadian Real Estate a__ociation
Commercial Investment Real Estate Institute
CREA MLS sites
CREA REALTOR site (members only)
Ontario Real Estate a__ociation
OREA Real Estate College
Real Estate Boards
Real Estate Council of Ontario
Real Estate Institute of Canada
Society of Industrial and Office REALTORS
STRATEGIC THINKING
1. What steps must I take and when if I want to join organized real estate, once I am registered as a salesperson with

the Real Estate Council of Ontario?
What real estate boards are of particular interest to me in my new career and what information is available from
those organizations?
2.
What advantages does organized real estate offer that will a__ist me and my clients in listing and selling residential
and/or commercial properties?
3.
What specialty organizations are best suited for the particular market niches that I want to pursue in residential or
commercial sales, once registered as a salesperson?
4.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Mini-Review
MIN I -REVI EW
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Review Topics

REVIEW QUESTIONS
This is a Self-a__essment; your answers will not be scored.
View the question, then click your mouse inside the text box and type in your answer. The "Solution" b___on will appear.
When you have finished, click on the "Solution" b___on to compare your response to the model answer.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Exercise Preparation
EXERCISE PREPARATION

Phase 1 Real Estate as a Professional Career Module I. The Profession Session 2 of 3 Exercise 2
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Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Regulatory Requirements and
Procedures
REGULATORY
REQUI REMENTS & PROCEDURES
The Real Estate Council of Ontario fulfills duties regarding registration, consumer
protection, compliance, and professional standards. RECO is actively involved in four
programs: registration, insurance, mandatory continuing education, and
inspections/investigations.
Registrants are regulated under the Real Estate and Business Brokers Act (REBBA) as
well as governed by the Council.
Membership in RECO goes hand-in-hand with registration under REBBA. To be registered
under the Act, the salesperson or broker must satisfy RECO's membership criteria. To be
a member of RECO, the salesperson or broker must be registered under REBBA.

Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Session Guide
SESSION GUIDE
THESE TOPICS ARE COVERED IN THIS SESSION:
REGISTRATION
OTHER RECO REQUIREMENTS
RECO Insurance Program
Mandatory Continuing Education
PROFESSIONAL CONDUCT
Complaints, Compliance, and Discipline - CCD (Registrar's Complaints
and Inquiries- RCI)
Real Estate and Business Brokers Act
KNOWLEDGE INTEGRATION
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Learning Outcomes
LEARNING OUTCOMES
AT THE CONCLUSION OF THIS SESSION, STUDENTS WILL BE ABLE TO:
Identify and describe the REBBA registration process, including the initial
application.
Outline registration exemptions and special circumstances that can impact
registration.
Describe the RECO Insurance Program including general policy provisions and
exclusions.
Detail mandatory continuing education requirements and the renewal process.
Briefly describe the REBBA Code of Ethics and the Compliant, Compliance, and
Discipline (CCD) process relating to Code enforcement, now referred to as

Registrar's Complaints and Inquiries Process (RCI), under the new Act.
Outline the Registrar's role and the use of inspections/investigations pursuant
to REBBA
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Registration

REGISTRATION
Registration under REBBA is for two years, at which time every
registrant must apply for renewal. The Registrar oversees REBBA
administration to ensure both high levels of consumer protection and
knowledge/skills in real estate brokerage.
The Manager of Registration and a__istant Registrar a__ists in REBBA
administration and enforcement. Responsibilities, in addition to various
consumer related activities, include registration management and
recommendations for disciplinary matters under REBBA.
<--Click here to enlarge
MEMBER FOCUS
A RECO REGISTRATION PROFILE
RECO Registrations include new businesses, new broker/salesperson registrations, renewals, reinstatements, and database
maintenance (e.g., updating registrant information).

STUDY LINKS
Provincial Reference Manual
REBBA 2002
GUIDE TO REBBA (2002) A to Z Section

Appeals Committee
Code of Ethics
Discipline Committee
Education Requirements
Exemptions
Insurance Coverage
Interested Person
Registrar
Registration Requirements
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 RECO Requirements

OTHER RECO REQUIREMENTS
RECO INSURANCE PROGRAM*
RECO registration is a pre-condition to coverage.
Carefully review policy details, particularly what is and is not covered.
Note any special exclusions.
Clearly understand notice of claim procedure.
*Introductory discussion only. Detailed a___ysis, see Phase 3, Professional
Conduct.
MANDATORY CONTINUING EDUCATION
Mandatory Continuing Education (MCE) required once permanent salesperson status achieved.
Twenty-four credit hours in each two-year registration cycle.
RECO Real Estate Update (Res. or Comm.) must be taken in each cycle - accounts for six credit hours.
Balance consists of self-selected courses (based on RECO approved providers and approved content).
Maximum 8 credit carry-over into next registration cycle (does not include RECO Real Estate Update).
Failure to fulfill mandatory requirements - immediate RECO membership termination and expiry of REBBA
registration.
Declaration of Continuing Education must be completed at time of registration renewal.
THREE LEVELS OF COVERAGE

ERRORS & OMISSIONS STATISTICS

PERCENTAGE OF CLAIMS (PAID AND RESERVE) BY REGION
CAUTION
RECO REAL ESTATE UPDATE
Keep up-to-date. Review current policies and procedures. Changes can directly impact your registration status. For
example, in early 2003, both residential and commercial versions of RECO Real Estate Update became available. While
only one is required during each two-year registration cycle, the second course can be applied against the 18
additional credits required. However, credits received from either course cannot be carried forward into the next
registration cycle.
STUDY LINKS
Provincial Reference Manual
OREA/RECO
RECO - Programs/Activities:
Insurance Program

Educationâ€"The Learning Cycle
Mandatory Continuing Education
GUIDE TO REBBA (2002) A to Z Section
Renewal
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Professional Conduct

PROFESS IONAL CONDUCT
COMPLAINTS, COMPLIANCE, AND DISCIPLINE (CCD)
Ethical responsibilities and statutory requirements governing salespersons' actions are intertwined between the REBBA
Code of Ethics and the Real Estate and Business Brokers Act.
Ethics and the detailed a___ysis of the REBBA Code can be found in Phase 3.
Administered by Manager of CCD. The process is now called Registrar's Complaints and Inquiries Process (RCI) under
the new Act.
Addresses members who breach the Code of Ethics
Handles consumer-to-member and member-to member complaints.
Complaints, Compliance, and Discipline procedures are flexible mechanisms to address complaints, i.e.,
alternative dispute resolution, screening, administrative requirements and disciplinary hearings. There is also an
appeal process.
REAL ESTATE AND BUSINESS BROKERS ACT
Overseen by Registrar.
Statutory requirements, e.g., registration, broker/ salesperson responsibilities, trading practices, document
requirements (listing agreement and agreement of purchase and sale), deposits, and trust accounts.
Professional conduct, e.g., broker/salesperson duties, disclosure requirements, and advertising standards.
Includes inspections and investigations procedures.
Detailed REBBA a___ysis in Phases 2 and 3.
CCD FOCUS
ADMINISTRATIVE ACTIONS - MANAGER OF CCD AND THE REGISTRAR
Professional conduct may involve infractions that span both the Code of Ethics and REBBA. Both the Registrar and the

Manager of CCD (RCI) can take administrative actions within their appropriate authorities. Increasingly, member conduct
matters fall to CCD (RCI), with REBBA complaints reduced significantly. REBBA actions centre more on registration matters,
inspection deficiencies, revocation of registration, and employment of non-registrants.
CURIOSITY
CCD: HOW DO REAL ESTATE BOARDS FIT IN?
What happens if a consumer complains about a registrant to his/her real estate board? The board must enforce its rules,
by-laws, and regulations, as well as the CREA Code of Ethics. Organized real estate established a Co-existing Discipline
Jurisdiction Model (CDJ) that provides routing procedures for complaints.
A pre-screening process directs the complaint to RECO, to the Professional Standards Committee (PSC) of the applicable
board, or both in selected instances. The screening is performed by a PSC sub-committee. This approach largely avoids
duplication of effort and a member being disciplined twice for the same activity. Instances can arise where a board member
is investigated and disciplined by both RECO and the Board, given their differing frames of reference concerning the same
misconduct.
HAVE YOU WONDERED?
The CCD Process is very flexible and includes various options to resolve matters, including alternative dispute resolution.
However, questions often arise if a hearing is required.
Click on the question marks below to answer the questions.
STUDY LINKS

Provincial Reference Manual
Professional Conduct
Complaints, Compliance, and Discipline
Code of Ethics - Regulation 580/05 *
GUIDE TO REBBA (2002) A to Z Section
Inspections
Investigations
Registrar's Complaints and Inquiries (RCI) Process
* General understanding of terminology and content required. Detailed a___ysis of Code and REBBA follow in
Phases 2 and 3.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Knowledge Integration

KNOWLEDGE INTEGRATION
NOTABLES
Salesperson registration is administered directly by the Registrar, with a__istance from the Manager of Registration
and a__istant Registrar.
Differing registration requirements and procedures apply to salespersons, brokers, sole proprietors, partnerships, and
corporations.
Registration exemptions include auctioneers in the course of normal business activity, full-time employees involved in
trading employer-owned property, and individuals acting as solicitors in the normal course of their practice.
Salesperson registration requires application to the RECO Insurance Program.
The RECO Insurance program consists of three policies. RECO registration is a pre-condition to coverage.
Notice to the insurer is required when a claim is made and also when circumstances arise that might give rise to a
claim, i.e., a potential claim.
Twenty-four credit hours of mandatory continuing education are required in each two-year registration cycle
following permanent salesperson status.
The REBBA Code of Ethics contains member obligations.
The RCI process handles consumer-to-member and member-to-member complaints.
Professional conduct is enforced through the REBBA Code of Ethics and the Real Estate and Business Brokers Act.

GLOSSARY
Administrative Requirements
Approved Providers
Commission Protection Insurance
Complaints, Compliance, and Discipline
Consumer Deposit Insurance
Declaration of Continuing Education
Errors & Omission Insurance
Ethics
Guiding Principles
Inspection
Investigation
Mandatory Continuing Education (MCE)
RECO Code of Ethics
Registration
Registration Cycle
Rules
Self-Selected Courses
WEB SCANS
Telephone inquiries: 1-888-296-8755 or (416) 207-4847 E-mail:
ccd@reco.on.ca
Insurance inquiries: 1-800-245-6910 or (416) 207-4800
E-mail: cpp@reco.on.ca (CPP (Consumer Protection Program) is an
alternate terminology referring to the RECO Insurance Program).
STRATEGIC THINKING
What difficulties, if any, might I encounter in obtaining REBBA registration after having reviewed the Application for
New/Reinstatement: Broker/Salesperson?
1.
Do any exclusions included in the various policies in the RECO Insurance Program directly impact me at this point of
time, e.g., exclusions relating to property management activities in the errors & omissions policy?
2.
When will I have to commence mandatory education courses and what types of programs will best advance my
career in the local marketplace?
3.
How can I best prepare for advanced study in Phases 2 and 3 relating to the RECO Code of Ethics and the Real Estate
and Business Brokers Act?
4.
Phase 1 Real Estate as a Professional Career Module I. The Profession Session 3 of 3 Mini-Review

MIN I -REVI EW

Preparation
EXERCISE PREPARATION

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a__IGNMENT
Welcome to the a__ignment segment of the course.
Click your mouse inside the text box and then type in your answer. The "Solution" b___on will appear. When you have
finished, click on the "Solution" b___on to compare your response to the model answer.
Phase 1 Real Estate as a Professional Career Module I. The Profession a__ignment 1 a__ignment 1- Part B
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Phase 1 Real Estate as a Professional Career

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