Recent class-action suits against the Canadian Real Estate Association (CREA) highlight the competition and commission practices in the industry. These legal developments will have a significant impact on how real estate transactions will be conducted across Canada.
This class action suit names CREA and nearly all real estate licensing boards across Canada, and alleges anti-competitive practices. These claims suggest that ‘rules requiring home sellers to offer a cooperating commission to prospective buyer brokerages when listing a property on the MLS® System are anti-competitive and harmed home sellers in the form of higher commissions.’ In 2010, the Federal Government Canadian Competition Bureau (Competition Bureau) was successful in forcing the Canadian Real Estate Association (CREA) to change its rules governing real estate “agency” in Canada. The Canadian government has long maintained that the MLS® System maintains a monopoly on resale homes in Canada and with these rule changes, was to provide Canadian homeowners the ability to sell their residential property on the MLS® System without being represented by a real estate agent.
The outcome that resulted from the rule changes is that licensed realtors are now able to post a property on the MLS® System without entering into an agency relationship with the home seller. A brokerage can simply enter your listing into the MLS® System and have no more involvement with the sale of the property. Such a listing within the MLS® System is called a “mere posting”.
Although this ruling occurred in 2010, the availability of Mere Posting services is not well supported by many industry members, and not widely known by the public. This class action suit against the Canadian Real Estate industry brings back into question whether licensed real estate professionals are negating the rules set out by the Competition Bureau.
At ComFree, we see the demand for seller commissions or cooperating commissions unfair to consumers who simply want the exposure to sell their residential property and are willing and prepared to do it without a licensed realtor. They may be willing to do it on their own for many reasons, but most notably the outrageously high commissions charged by full-service brokerages. As ComFree expands in the Alberta market, we are committed to eliminating commissions for our customers, while still providing the exposure of the MLS® System and the tools and support they need to sell their own home. Whether you’re buying, selling, or renting, we’re here to provide the support and information you need.
For a more detailed analysis and expert guidance, reach out to us at ComFree Realty or visit the full link to the article here
Courtesy of Whatever Else Marketing
The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. The trademarks MLS®, Multiple Listing Service® and the associated logos are owned by CREA and identify the quality of services provided by real estate professionals who are members of CREA.
* Only when the buyer comes direct, otherwise the seller may choose to negotiate a commission with the buyer’s agent.
