RECO wants fees back to 2022 levels, cites $30M shortfall

Ontario’s real estate regulator is proposing to reverse fee cuts introduced in 2023, returning fees to 2022 levels, adjusted for inflation.

On Aug. 11, the Real Estate Council of Ontario (RECO) posted the proposal to its website, asking for stakeholder feedback. If approved, the hike would take effect Jan. 1, 2027.

“Ontario has the lowest real estate services regulatory fees in the country and the largest real estate registrant population,” RECO said in the proposal.

Jean Lépine, RECO’s administrator and acting chief executive, addressed the proposal directly in remarks at RECO’s third Collaboration Summit in Ottawa on Monday.

“I have been clear that RECO’s current fee structure doesn’t provide the necessary revenue to fully meet our consumer-protection mandate. RECO is supposed to be a cost-recovery regulator,” Lépine said.

Fee levels

Under the proposal, the registration fee that’s applied to new registrations and biennial renewals would climb from $306 to $398, compared to the $390 charged in 2022. The processing fee for new applications would climb from $50 to $204, above the 2022 rate of $200. The registration transfer fee would go from $25 to $102, also slightly above the 2022 rate of $100. According to RECO, the 2027 figures reverse the 2023 fee reduction, plus a 2.1 per cent adjustment for inflation.

RECO said fees have not increased in nearly a decade, while “the cost and complexity of regulating the sector continue to grow.” The regulator said it is also investing in modernization efforts it expects will strengthen oversight.

“The setting of Ontario’s fee structure goes back in time. The old fees aren’t geared to the regulatory mandate of the organization today,” Lépine said. “We know what it costs to deliver on this new mandate and for that reason, this adjustment is necessary, not popular, but the right thing to do.”

Financial pressures

RECO said the fee reduction introduced in 2023 will have resulted in an estimated $30 million in lost revenue by the end of 2026. That shortfall contributed to an $8.5 million operating deficit in 2025, which and is expected to grow.

There are currently more than 111,000 registrants in Ontario — a number that has remained relatively stable since 2023 — while RECO’s revenue fell and its expenses rose. Revenue dropped from $30.8 million in 2023 to $24.5 million in 2025, while expenses jumped from $23.4 million to $33.0 million. RECO attributed the sharper 2025 increase largely to oversight costs connected to the iPro Realty fallout, including legal expenses.

The regulator expects operating expenses to continue to rise in 2026, forecasting a $9-million shortfall that would need to be covered by its reserves.

“To do its job right, RECO must continue investing in the right people, modern technology, stronger data capabilities, and more pro-active, risk-based enforcement and awareness initiatives,” Lépine said. “We are adding people in inspection and audit.”

RECO asks for feedback

Speaking in Ottawa, Lépine said, “Longer-term sustainability will require a broader view of RECO’s operating model, funding needs, reserves and future responsibilities, and we will continue to seek your views as that work advances.”

Stakeholders are asked to submit feedback on the proposal through RECO’s website by Sept. 11 at 4 p.m.

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