• Sylvia Ho

Attention realtors…. Will incorporating mean you can’t get into your dream home?

Updated: Jan 4



Realtors: This can affect your future


On October 1st, 2020, the Ontario government implemented new regulations that impact real estate brokerages, brokers and salespeople. The new TRESA act is an important step in modernizing the real estate industry in Ontario; but what does it all mean for realtors and their business?


What do all these changes mean for you as a realtor?


Despite the hectic times you’re facing in your business right now, it’s crucial to remain focused on your long-term personal housing goals. That includes a deeper understanding of how these new regulations can directly impact you.


3 important steps for realtors:


1. Review your finances


That’s right- it’s time to dive into your books and assess your current financial picture. This is always a great idea before the end of the year, especially a tumultuous one like 2020! Print your latest statements, make yourself a steamy cup of coffee and take some much needed ‘me time’ to put your financial future in perspective. Book a virtual chat with your accountant or financial advisor if it’s needed too! Think about your home ownership goals and whether or not they’ve shifted during the pandemic. Have you been assessing the market for the right time to buy your dream home? Are you looking to acquire a 2nd property for rental purposes? Do you have university-age kids that are back home studying remotely and you’re needing more square footage to make it bearable for the family?! Whatever your situation, it’s important to get a handle on the dollars and cents before executing elaborate plans.


2. Get a second opinion on your current mortgage details


I’ll always recommend this! Do you commit to a home reno without getting multiple quotes? No way! Do you peek at restaurant reviews on UberEats before clicking ‘Place Order’? Of course you do- you’re a savvy, smart consumer in a world with tons of choices. So why wouldn’t you seek a second opinion for something as important as your mortgage? Reach out to me here if you’re wanting guidance with seeking out a second opinion. Always remember- my services are free of charge (lenders pay my commission, not homeowners!)


3. Buy your dream home today BEFORE incorporating!


“The Toronto Regional Real Estate Board (TRREB) is applauding the provincial government’s announcement that those who trade in real estate in Ontario can now structure their businesses as Personal Real Estate Corporations (PRECs)”


TRREB applauded the efforts of the Ontario government for this change, isn’t it a good thing?


Of course! Forming a personal corporation with your real estate business can be a huge advantage when it comes to tax savings. There will be opportunities for tax deferral, income splitting, and dividend income.


The issue arises with incorporation when it comes to interest rates. You may end up paying a higher interest rate on your mortgage, which is never welcome news. As with so many things in life, timing is everything! To learn more about how Personal Real Estate Corporations can affect your mortgage rate, reach out for a no-obligation chat.


As of 2019, there were more than 86,000 registered real estate salespeople, brokers and brokerages in Ontario. That’s a huge number of professionals affected in the province by these new regulations- and it’s imperative they make educated decisions while building their own real estate empire!


More changes ahead

There’s a secondary phase of regulatory development scheduled to roll out later this year as a result of TRESA. It will involve more actions pertaining to the Code of Ethics, disclosure requirements to protect home buyers, and changing the authorities held by the Real Estate Council of Ontario.

We’ll be keeping a close eye on these changes. As always, Sylvia Ho Mortgages will provide relevant advice on the issues that affect you, the current and future homeowners in the GTA.



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