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May 26th, 2011

Real-estate career now tougher, more costly

Posted by Joan McGuigan
  • Article rank
  • 26 May 2011
  • Allison lAmpert alampert@
  • Preparatory courses, cost of exam both more difficult and expensive than in 2010

    At one time, recruiting new real-estate brokers in Quebec used to be as easy as waiting for a prospective agent to walk through the door.

    But higher fees and a tough new entrance exam stemming from a change last year in the law governing Quebec’s real-estate industry are turning new real-estate brokers into increasingly rare commodities, some agencies say.

    Fees have more t han doubled, discouraging parttime brokers from staying in the profession, agencies say, even as the success rate of the real estate licensing exam has plummeted from 78 per cent before the new law, to 42 per cent today.

    As a result, agencies are working harder and offering more incentives to lure recruits in a province that’s gaining the reputation of being the toughest place to become a real-estate broker in the country.

    “Before, franchise owners could just get interviews with prospective brokers,” said Dominic St-Pierre, director of Royal LePage Quebec. “This is not the case anymore. It (the new law) has discouraged people from becoming real estate brokers.”

    Lorraine Brien, owner of a Century 21 in Brossard, said she now offers goodies such as increased home staging services to brokers who join her agency.

    “We have to offer a lot more gifts now than before (to new recruits),” Brien said. “The negotiation period is much longer.”

    This week, Royal LePage and Via Capitale parent company Brookfield Real Estate Services Inc. reported a net organic attrition of 106 brokers during the first few months of the year, primarily from its Quebec network, following the introduction of the Real Estate Brokerage Act in May 2010.

    There are just more than 16,500 licensed regular and chartered real-estate brokers in the province, according to statistics from the Organisme d’Autoréglementation du Courtage Immobilier du Québec, or OACIQ, which applies the real estate law.

    The OACIQ couldn’t say how many licences were issued during the first few months of 2011.

    The number of licences has risen and dropped over the years, largely in a direct correlation with the amount of activity in the market, agencies say.

    “Every time the market is a sellers’ market, people think it’s easy to become a real-estate broker,” St-Pierre said.

    But the residential resale market, while not as strong as it was two years ago, is still considered to be a sellers’ market, St-Pierre said.

    OACIQ president and CEO Robert Nadeau said the organization is not trying to reduce the number of brokers in Quebec, but rather to improve the preparation of brokers working as real-estate professionals.

    “We cannot offer discount (real-estate) licences,” Nadeau said in an interview with The Gazette.

    “Some people would come out of the school and they didn’t know how to do a promise to purchase. There was a big weakness (with the old system).”

    The old exam offered before May 2010 was multiple choice and only three hours long, Nadeau explained. Candidates could fail certain sections but still pass the exam as long as they obtained a 70-per-cent grade overall.

    The new exam takes six hours and is based on a problem-solving approach, as opposed to multiple choice, Nadeau said. Test-takers must now pass all sections of the exam.

    The new exam is also more expensive to take – $500 compared to the old one at $188 – because the process of correcting it is more labour intensive, he said.

    But even the cost of preparatory courses to take the exam, students say, has soared from less than $1,000 before the new law to thousands of dollars now, the amount depending on the college offering the necessary courses.

    Part of the challenge for students is that the colleges are adapting to the new exam, including the preparation of new pedagogical materials.

    “The colleges are also adjusting,” Nadeau said.

    He doesn’t see the exam as a barrier to becoming a realestate broker in Quebec, he said.

    “I think that a lot of people underestimated it (the new exam),” he said.

    “The people who were serious and worked hard passed the exams.”

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