Ontario Humber Real Estate Course 1 Notes

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Questions and Answers

What is the main difference between a 'Customer Service Agreement' and a 'Representation Agreement'?

  • A Customer Service Agreement is used to negotiate terms between a seller and buyer, while a Representation Agreement is used to negotiate terms between a buyer and a brokerage.
  • A Customer Service Agreement provides non-exclusive services with no obligation to compensate the brokerage, whereas a Representation Agreement is exclusive and requires compensation. (correct)
  • A Representation Agreement is a written agreement, while a Customer Service Agreement can be verbal.
  • A Customer Service Agreement is only for sellers, while a Representation Agreement is only for buyers.

What does a commission agreement usually specify?

  • The date on which the transfer of ownership will be completed.
  • The specific terms of the mortgage agreement for the property.
  • The amount of compensation the buyer will pay to the seller for the property.
  • The percentage of the sale amount that will be paid to the brokerage as commission. (correct)

What is the difference between 'real estate' and 'real property'?

  • Real property is limited to land, while real estate includes land and all improvements built on it.
  • Real estate refers to land and its related rights, while real property refers to movable objects that are on the land.
  • Real estate refers to the physical structure of a property, while real property refers to the legal ownership of the property.
  • Real estate refers to the intangible aspects of a property, while real property includes both tangible and intangible aspects. (correct)

Which of the following is NOT considered 'personal property'?

<p>The house itself. (C)</p> Signup and view all the answers

What is the purpose of title searching?

<p>To determine the legal ownership of a property and the rights associated with it. (A)</p> Signup and view all the answers

What is the significance of the completion date/closing date in a real estate transaction?

<p>It is the date on which the buyer takes possession of the property and the seller receives the agreed-upon purchase price. (C)</p> Signup and view all the answers

What is the purpose of a mortgage in a real estate transaction?

<p>To protect the interests of the lender by securing their investment in the property. (A)</p> Signup and view all the answers

What is the main difference between a mortgage registered under the Registry Act and a charge registered under the Land Titles Act?

<p>A mortgage allows the lender to claim the property, while a charge gives the lender a claim against the property without taking ownership. (A)</p> Signup and view all the answers

What action can RECO take if a registrant is found to be in contravention of the Act or Regulations?

<p>Issue a notice of proposal (A)</p> Signup and view all the answers

Which of the following is a possible consequence for a registrant who fails to comply with advertising guidelines?

<p>Issuance of a written warning (C)</p> Signup and view all the answers

What might RECO require from a registrant in response to specific complaints or issues?

<p>Enrollment in further educational courses (A)</p> Signup and view all the answers

What is one of the voluntary conditions that RECO might apply to a registrant's registration?

<p>Submission of all advertising for review (C)</p> Signup and view all the answers

When might RECO request a meeting with a registrant?

<p>To remind them of professional conduct requirements (A)</p> Signup and view all the answers

What is the purpose of a Discharge of Charge/Mortgage?

<p>To remove a claim against a property (B)</p> Signup and view all the answers

Which type of residential structure shares one wall and is located on separately deemed lots?

<p>Semi-detached (C)</p> Signup and view all the answers

Which type of mortgage document is used to indicate the lender's claim under the Registry Act?

<p>Mortgage (A)</p> Signup and view all the answers

Which residential structure category is known for having three or more units joined by party walls?

<p>Townhouse (D)</p> Signup and view all the answers

What percentage of living area is typically located on the first floor of a one and one-half storey house?

<p>60% (D)</p> Signup and view all the answers

What is a primary advantage of attached residential structures?

<p>Reduced building cost (A)</p> Signup and view all the answers

What type of home offers effective use of lower basement areas with raised levels for better ventilation?

<p>Bi-level/split entrance (B)</p> Signup and view all the answers

Which term correctly describes the borrower in a mortgage scenario under the Registry Act?

<p>Mortgagor (B)</p> Signup and view all the answers

What is required for a salesperson to make a claim for commission or remuneration?

<p>Both the brokerage and the salesperson must be registered. (D)</p> Signup and view all the answers

Which of the following circumstances must be disclosed in a registration application?

<p>Outstanding debts or unpaid judgments. (B)</p> Signup and view all the answers

What is the primary responsibility of the broker of record?

<p>To ensure compliance with Acts and regulations within the brokerage (C)</p> Signup and view all the answers

What must a brokerage do within five days if the broker of record changes?

<p>Submit the change to the Registrar in writing. (D)</p> Signup and view all the answers

Which certification is specifically awarded for completion of graduate level courses in commercial real estate?

<p>Certified Commercial Investment Member (CCIM) (A)</p> Signup and view all the answers

Which type of party does NOT require formal ownership to be considered an interested party?

<p>An investor who funds a venture. (D)</p> Signup and view all the answers

In a branch office with two or more registrants, what is required?

<p>Management by a broker or salesperson with at least two years of registration (B)</p> Signup and view all the answers

What may the Registrar consider grounds for refusal to register?

<p>Past conduct indicating irresponsible business practices. (A)</p> Signup and view all the answers

What should a listing salesperson do to establish a list price with the seller?

<p>Conduct an inspection of the property and compare market analysis (A)</p> Signup and view all the answers

Which statement is TRUE regarding the financial position of an applicant?

<p>Personal insolvency can affect the registration application. (D)</p> Signup and view all the answers

Before trading in seasonal or vacation rentals, what must a person do?

<p>Register as a trader under the appropriate act. (D)</p> Signup and view all the answers

What is one of the roles of a branch manager?

<p>Manage all records related to the branch (A)</p> Signup and view all the answers

What must a brokerage with multiple locations do?

<p>Register the main brokerage office and the branches under supervision (D)</p> Signup and view all the answers

What constitutes a false statement in a registration application?

<p>Failure to include a required disclosure. (C)</p> Signup and view all the answers

What certification signifies a property manager's proficiency in managing residential properties?

<p>Accredited Residential Manager (ARM) (D)</p> Signup and view all the answers

What must branch offices with more than one salesperson ensure?

<p>They are directly supervised by a branch manager (B)</p> Signup and view all the answers

What defines a common-law spouse according to the given information?

<p>Partners who have lived together for more than three years. (D)</p> Signup and view all the answers

How does the ownership of a family home differ between common-law partners and legally married couples?

<p>Common-law partners can sell or mortgage without permission, but married couples cannot. (D)</p> Signup and view all the answers

In the event of a dissolution of a common-law relationship, what may the registered owner be required to do?

<p>Provide support payments and satisfactory accommodation. (B)</p> Signup and view all the answers

What is the primary purpose of the Planning Act?

<p>To promote sustainable economic development. (D)</p> Signup and view all the answers

Which type of municipality assumes all municipal responsibilities according to the Municipal Act?

<p>Single-tier municipality. (D)</p> Signup and view all the answers

What is the role of upper-tier municipalities in a two-tier municipality system?

<p>Responsible for preparation and revision of the Official Plan. (C)</p> Signup and view all the answers

What ensures fairness in planning processes according to the Planning Act?

<p>Open and accessible processes. (A)</p> Signup and view all the answers

Which of the following municipalities is an example of an upper-tier municipality?

<p>Wellington County. (D)</p> Signup and view all the answers

Flashcards

Voluntary Conditions

RECO can ask a registrant to accept additional rules or conditions, like submitting all advertising for review for a specific time.

Request a Meeting

If a complaint is filed, RECO might ask the registrant to attend a meeting to discuss the issue. This could lead to informal advice or a warning.

Written Warning

RECO can issue a formal warning to a registrant, stating that if similar conduct continues, stricter action might be taken.

Educational Courses

RECO can require a registrant to participate in educational courses to improve their understanding and practices.

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Immediate Suspension

In serious cases, RECO can immediately suspend a registrant's license to protect consumers. This is a temporary action.

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Agreement of Purchase and Sale

A legal document that outlines the terms of a real estate transaction between a buyer and seller. It includes details like purchase price, closing date, and any contingencies.

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Mortgage

A document that grants a lender a claim on a property as security for a loan. It's registered on the property's title.

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Title

The legal ownership of land and all its rights that go with it.

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Title Searching

The process of searching through public records to uncover facts about the ownership history of a property.

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Real Property

Tangible and intangible aspects of a property that add value. It includes the land itself, rights like air rights and mineral rights, and any improvements.

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Completion Date/Closing Date

The date when ownership of a property officially transfers from the seller to the buyer.

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Deed

A document used to prove the legal transfer of ownership of a property.

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Fixtures

Items that are permanently attached to a property and considered part of it, even though they might have been originally movable.

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Charge/Mortgage of Land

A legal document that registers a claim against a property, typically for a loan or mortgage.

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Discharge of Charge/Mortgage

A legal document used to remove a registered claim against a property, usually when a debt has been repaid.

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Bungalow

A one-story house, often found in older neighborhoods, popular with older couples.

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Bi-level/Split Entrance

A house with a split-level design, often with a raised basement area.

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One and one-half Storey

A house with a main floor and a smaller, angled second floor, offering a cost-effective way to get more living space.

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Two-storey

A house with two full levels, often considered a more traditional design.

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CCIM (Certified Commercial Investment Member)

A designation earned by completing graduate-level courses in commercial real estate, demonstrating expertise in advanced concepts and techniques.

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SIOR (Society of Industrial and Office REALTORS)

An organization focused on maintaining high standards in the commercial and industrial real estate industry, for its members.

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Broker of Record

A registered broker responsible for ensuring compliance with real estate laws and regulations within a brokerage.

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Branch Office

A brokerage office that operates outside of the primary location, requiring supervision by a broker and compliance with registration requirements.

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Branch Manager

A registered broker or salesperson with at least two years of experience, tasked with managing a branch office with multiple registrants.

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Listing Salesperson

A salesperson responsible for the listing process, including property inspection, market analysis, pricing recommendations, and marketing strategy development.

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Salesperson

A registered real estate professional who can conduct transactions, including sale and purchase of properties.

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REBBA

The Real Estate and Business Brokers Act, 2002, which governs real estate practices and regulations in Ontario.

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Common-Law Spouse

Individuals who live together and are considered legally married without a formal ceremony.

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Family Home (Common-Law)

The living space shared by a common-law couple. This space is not considered a matrimonial home, meaning protections associated with legally married couples may not apply.

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Matrimonial Home

The living space considered legally owned by a married couple.

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Planning Act

A legal document that dictates the framework for land development in Ontario. It sets out policies for sustainable economic development, integrates matters of provincial interest, and ensures fairness and transparency in planning processes.

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Single-Tier Municipality

One type of municipality within Ontario. They are responsible for all municipal responsibilities, including planning, development, and services.

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Upper-Tier Municipality

A type of municipality in Ontario formed by multiple lower-tier municipalities. They primarily oversee policies and planning for the entire region, while individual municipalities (lower-tier) handle local matters.

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Lower-Tier Municipality

A type of municipality within Ontario that operates under the umbrella of an upper-tier municipality. They handle local matters related to planning and development.

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Official Plan

A document that outlines a municipality's long-term vision for land use and development. It includes policies and strategies for growth, infrastructure, and sustainability.

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Registration for Trading in Rentals and Commercial Leases

Trading in seasonal/vacation rentals and commercial leases requires registration with RECO, except for individuals who solely arrange leases under the Residential Tenancies Act.

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Salesperson Registration Notification

A salesperson must be formally notified in writing by RECO that they are registered before they can trade.

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Registration Requirement for Commission Claims

Both the brokerage and the salesperson must be registered at the time of providing services related to a trade in order to claim commission or remuneration.

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Broker of Record Notification

A brokerage must provide the Registrar with the name of their broker of record in writing. If the broker of record changes, the brokerage must notify the Registrar within five days.

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Broker of Record in Sole Proprietorships

In a sole proprietorship, the owner of the brokerage is also the broker of record.

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Registration Considerations - Financial Position

The Registrar considers the applicant's financial position during registration and renewal applications. This includes checking for past bankruptcies, consumer proposals, and other financial liabilities.

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Refusal to Register

The Registrar may refuse to register an applicant if they believe the applicant has not provided complete and accurate information, or if there are concerns about their past conduct.

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Interested Party Definition

A person is considered an interested party if they have a financial interest in another person's business, exercise control over them, or provide financing, even without formal ownership.

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Study Notes

Ontario Humber Real Estate - Course 1 Notes

  • REBBA (Real Estate and Business Brokers Act) provides framework for regulation of real estate transactions, responsible to Ontario ministry of government and consumer services
  • Registrant: Individual or brokerage registered to trade in real estate
  • Code of Ethics: Regulation under REBBA; outlines acceptable conduct, eliminating ambiguity, and protecting buyers/sellers
  • Fairness and Honesty, and Conscientious and Competent Service are key ethical principles
  • Services from Others: advise seller/buyer to get outside info if needed
  • RECO (Real Estate Council of Ontario): administers REBBA for provincial government support of fair and informed real estate market
  • RECO's role: enforce registration, education, & insurance standards; address complaints, etc.
  • Trading: Includes purchasing, selling, leasing, etc. of property
  • Brokerage: a corporation, partnership, or sole proprietorship that trades for profit
  • Broker: Registered role as broker, employed by a brokerage to trade
  • Salesperson: Registered as salesperson, employed by a brokerage to trade
  • Broker of Record: responsible for daily operations, provides support to employees, signs on behalf of brokerage (not the agent)
  • Any agreement regarding purchase, sale, exchange, lease is with brokerage not the salesperson
  • Education and registration requirements for becoming a salesperson
  • Exam 1: Real Estate Essentials (Fundamentals, role of salesperson in relation to REBBA and Code of Ethics)
  • Exam 2: Residential Real Estate Transactions Theory + Sim. exam
  • Exam 3: Additional Residential Real Estate Transactions (condos, rural, etc.)
  • Exam 4: Commercial Real Estate Transactions (expands on condos, rural props, etc.) Theory +Sim. exam
  • Getting Started, Sellers and Buyers Market, Different Real Estate types

Module 2

  • Real Estate is a profession within Ontario, specifically regulating real estate trading activities
  • Listing brokerage, when a brokerage has a property for sale
  • Cooperating with a buyer's brokerage to find a property to acquire
  • Lease/rental considerations, and landlord/tenant responsibilities
  • Brokerage representing a party, as well as providing services to them

Module 3 - Lesson 1

  • Types of estates (estate = interest in land with rights):
    • Fee simple (full ownership)
    • Leasehold (right to use/occupy land for specific period)
  • Property interests:
    • Air rights
    • Surface rights
    • Riparian rights
    • Mineral rights
  • Types of concurrent ownership (2 or more):
    • Joint tenancy (survivorship rights)
    • Tenants in common (no survivorship)

Module 3 - Lesson 2

  • Easement: legal right to use land owned by someone else
    • Dominant vs servient tenements
  • Easement creation, such as express grant, implied by necessity, etc
  • Types of easements
  • Extirpation: A species exists elsewhere in the world, but is no longer found in Ontario
  • Endangered: A species that faces a high risk of extinction
  • Threatened: A species with a moderate risk of extinction

Module 3 - Lesson 3

  • Breach of contract: Failure to abide to an agreement
    • Fundamental vs. compensable
  • Remedies for breach: monetary compensation, termination
  • Fraud, duress, undue influence, misrepresentation, failure to disclose are factors contributing to a voidable or illegal contract

Module 4 - Lesson 1

  • Origin of Land Measurement (Gunter's chain)

  • Survey Methods: Metes and bounds, survey plans

  • Types of surveys: Real property report, survey of a property

  • Land plan records and its significance ### Module 5 - Lesson 1

  • History of REBBA (focus)

  • Organization of RECO

  • Delegations of authority to different areas

### Module 5 - Lesson 2

  • Registration requirements
  • Financial positions
  • Past conduct and false statements
  • Registrar's conditions for approval

Module 5 - Lesson 3

  • Required records
  • Financial responsibilities, compliance, and reporting
  • Broker of record obligations

Module 5 - Lesson 4

  • Handling complaints using fair processes

  • Disciplinary actions by organizations in situations involving breaches of code or misconduct ### Module 5 - Lesson 5

  • Requirements of a brokerage trust account

  • Procedures for maintaining trust accounts

  • Deposit and disbursement policies, with regulatory requirements

Module 7 - Lesson 1

  • Definition of contract; elements for a legally enforceable contract
  • Written agreements (required for interest in land) to be enforceable

Module 7 - Lesson 2

  • Business income vs capital gain (Taxation considerations for income earned, and assets)
  • Business conducted in respect of properties

Module 7 - Lesson 3

  • The sale of a principal residence, in regards to avoiding capital gains tax
  • Factors considering a property not being classified as a residence for tax purposes (Example: not living in property), considerations to ensure compliance with applicable legislation regarding residency

Module 7 - Lesson 4

  • Provincial Policy Statement in respect to a greenbelt
  • Land use planning and related matters
  • Considerations for environmental factors, and related legislation
  • Environmental site assessments (phases 1-3)

Module 7 - Lesson 5

  • Endangered Species Act, and its implications for development
  • The Ministry of Natural Resources (NRCan)

Module 7 - Lesson 6

  • Ontario New Home Warranties Plan Act and coverage
  • Warranties
  • Exclusions

Module 7 - Lesson 7

  • Legislation on building codes

  • Requirements for building permits, construction, and renovations ### Module 7 - Lesson 8

  • Zoning by-laws, as a municipal regulation

  • Approval process for zoning ### Module 7 - Lesson 9

  • Fuel Storage Tank Regulations

  • TSSA and their regulating requirements and process

Module 7 - Lesson 10

  • Overview of Land Severance procedures

  • Land severance, process to obtain permits for division of land ### Module 7 - Lesson 11

  • FINTRAC and its regulatory requirements for financial transactions, including real estate ### Module 7 - Lesson 12

  • Condominium corporations and their legal requirements

  • Formation & declaration

  • Description of property

  • Interests and requirements under the Act ### Module 7 - Lesson 13

  • Residential and commercial tenancy types, agreement requirements, rent calculations

  • Dispute resolution, processes, and requirements

### Module 7 - Lesson 14

  • Canadian Anti-Spam Legislation (CASL) requirements for communicating with potential buyers
  • Consumer consent
  • Express/implied consent, and compliance with CASL
  • Additional responsibilities of brokerages.

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