November 6th, 2009 | 
Author: Real estate agents won’t lose their grip on the listings process as part of the Canadian Real Estate Association’s settlement with the Competition Bureau of Canada.
The association (CREA) had signalled this week that its Multiple Listings System (MLS) may need to be thrown open to competitors to satisfy the bureau – giving consumers more choices on how to buy and sell homes and lowering costs as discount real estate brokers emerge and cut agents out of the process.
One of the things that concerned the bureau was that sellers could not post a listing on the online service without going through a real estate agent, and paying the associated fees. Access to MLS is essential for would-be sellers, because it accounts for 90 per cent of residential property sales in Canada each year.
In a statement yesterday, however, the association said reports that “a proposed resolution between CREA and the Competition Bureau would result in members of the public being able to access the MLS System to list their homes for sale without involvement of a Realtor member of CREA … is incorrect. The MLS system is a system for Realtor members of CREA.”
The association did not say how it would address the bureau’s concerns about the service – which also include clauses that prohibit anyone but an agent from handling transactions that are associated with an MLS listing – but did say it hoped to see a resolution before its December meeting. The bureau can impose changes if it feels its concerns weren’t adequately addressed.
MLS was developed in the 1960s, long before computer networks made information sharing simple and efficient. It allows agents from different real estate agencies to co-operate on deals, and ensures that each property is well-exposed to potential buyers.
Last year, sales hit $132-billion, according to CREA, generating about $6.6-billion for real estate agents assuming a typical 5-per-cent commission.
But the Competition Bureau has signalled that MLS data should be shared with outside companies, which could open the way to discount providers – companies that would help seal a real estate deal for a flat fee, rather than the typical commission structure.
Source: Globe & Mail
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As a realtor I resent hearing about how much money Realtors make and how they are ripping off Sellers with their high commissions. Notice the media never mentions what the average Realtor makes per year after expenses? There is a definite reason for that.
Furthermore I have no problem that commissions are negotiable or competing with Discount Brokers wanting to charge less. What I do have a problem with, is them not properly representing the seller. They owe a fudiciary duty to the Seller,to get them as much money as possible by skillful negotiations and protecting them legally in a transaction helping them to avoid any possible pitfalls that could land them in a future lawsuit. Instead they just simply list and leave and do nothing more for the Seller.
How would any lawyer feel if a potential client came to him or her and demanded partial representation to save on their fee.Telling the lawyer, “Yes, I want you to do all the paperwork and etc but I want to do all the talking and defend myself in court. Your years of education and experience in law is totally unnecessary and means nothing, I can represent myself equally as well and save money.”
I’m sure any selfrespecting lawyer would refuse to give such partial representation and would offer full service or nothing.
Likewise a Realtor that’s conscientious and a true professional feels exactly the same way and there’s a good reason why that is.
Realtors, who have been in the Real estate Business for a number of years have been required to take unending,ongoing Educational courses.This for the sole purpose of protecting their clients from legal pitfalls that could lead to major lawsuits. Their experience in negotiating effectively to obtain the highest price possible for the seller and still keeping a deal in tact between a buyer and Seller is also invaluable.
One court recorder whom I just recently sold a home to, told me “I would never buy or sell a home without a realtor. realtors are worth the money!” The reason she gave me was on account of all the real estate nightmares when sellers and buyers try to do it on their own that she heard firsthand and recorded in court.
I can’t help but feel that the Competition bureau has no concept or understanding for the true value of the full services that Realtors provide.On account of that they want to water down those services which will be detrimental to the public and will end up in lawsuits too numerous for the courts to handle.