VANCOUVER (Reuters) - British Columbia said on Wednesday it will end self-regulation in its real estate sector and dramatically boost fines for misconduct, amid public frustration over skyrocketing housing prices and reports of shady practices by some agents.
The move by the Canadian province comes the day after an independent advisory board released a blistering report on shortcomings in its real estate industry and recommended sweeping changes to how the sector is regulated.
Premier Christy Clark, speaking to reporters in Vancouver, said all regulatory and rule-making powers will be transferred to a dedicated superintendent of real estate, to be hired by the province immediately.
“The real estate sector has had 10 years to get it right on self-regulation and they haven’t. So we are going to end that privilege,” said Clark.
She also pledged to take immediate action on the advisory board’s other recommendations, including boosting the maximum penalties for misconduct to C$250,000 ($191,703) from a current C$10,000 for individual licensees, and to C$500,000 from C$20,000 for brokerages.
Soaring housing prices, particularly in the Vancouver area, have prompted concern that speculators and foreign investors are driving the market rather than local housing needs, with public frustrations further fanned by near-daily media reports on predatory practices by some agents and brokers.
British Columbia’s real estate industry is currently regulated by both regional real estate boards, who are industry groups, and the provincially-backed Real Estate Council, a board made up of real estate professionals and non-industry members.
The make-up of the Council, which will continue to have a role, will be overhauled so that the majority of its seats are held by non-industry members, to better serve public interest, Clark said.
She also laid out her government’s six principles for housing affordability, though they did not include action on foreign ownership or specific new taxes, like a speculation tax.
The province is now working on new legislation to reflect the planned changes, including moving all regulatory power to the Superintendent and the higher penalties.
Reporting by Julie Gordon; Editing by David Gregorio