A Realtor Knows the Market, Knows the Risks, Protects your Investment

Last November, when I first wrote about the Canadian Real Estate Association (CREA)/Competition Bureau conflict (over who gets to post listings on Realtor.ca) a flurry of comments were left at the end of that blog post - some in favour of the move to open-access for all to list on Realtor.ca, and some strongly against the move.

In the latter camp, one Mike Wiseman left a telling comment. He wrote that “there is no rule that an individual must use a realtor to purchase property, and on top of this, anyone can access the listings posted on MLS.ca. [now Realtor.ca] So why, in theory, would a realtor be necessary?”

He continues: “The answer is that a realtor knows the market, which changes daily, and can help you as a purchaser make an educated decision regarding your purchase. Would an investor invest without proper guidance, or without doing their homework? I think not. Why? Because the potential loss that may result could be catastrophic. Yet people on a daily basis invest in real estate without being given the proper knowledge, advice and guidance necessary to make the appropriate decision.”

Mike’s example about people getting appropriate guidance to make their investments is a good point - one that is often overlooked, it seems, when it comes to the buying and selling of residential real estate. Owning a home is the largest investment many Canadians will ever make, and it is a complicated and potentially risky business.

What if there are health-related hazards regarding the construction/materials of the home or office? What about outstanding liens? Making sense of the legalese put forth by real estate lawyers for the purchase agreement? Which comparable homes are selling the fastest and for what prices in your neighbourhood? And many, many other examples of knowledge required to avoid costly pitfalls. None of that assistance will come with piecemeal list-only services.

Now that CREA and the Competition Bureau have agreed in principle (CREA members still have to ratify the decision) to let Canadians hire a realtor solely to list their home for sale on Realtor.ca,  what does that really do for the betterment of Canadians making the biggest investment of their lives?

My colleague, Phil Soper, President & CEO of Royal LePage, has been quoted as saying, “ "There will always be people who would like to sell their own real estate, just as there are people who like to represent themselves in court. But that won't be the majority."

It will be interesting to see what happens with the new direction real estate is heading in this country. I wouldn’t be surprised if many consumers decide, after trying the alternative, that using the full range of services provided by an accredited REALTOR is a better investment choice.

4 Comments

  1. Rob Reynar 10/01/2010 at 3:30 PM

    Don, I agree with your thoughts. To me it's really too bad that because of the success of mls.ca, the website, that the Bureau and some consumers have forgotten that MLS is more than a website.. I really hope that your work in the background with Phil and Remax results in an alternative website with our product showcased.

  2. Wilf Mandel 10/02/2010 at 9:43 PM

    Could CREA have avoided all of this by proividing a paid interface to REALTOR.ca for FSBO "listings" with "For Sale By Owner" & Caveat Emptor labelling in regard to any requirements for accuracy and even legal ownership?
    As to the charge, whatever would be needed to recover the cost of building & maintaining the interface.

  3. Michelle Lu-Do 10/04/2010 at 11:36 AM

    In today's market, a lot of individuals come prepared by doing their own research on the market for their investment. The free flow of access to information have given way to people taking advantage of that information. It definately would be interesting to see its outcome of consumers choosing that alternative opposed to using an experienced professional realtor with the proper knowledge, advice and guidance necessary to make the appropriate decision.

  4. Vahab Jalali 10/25/2010 at 11:50 PM

    Out of curiosity... Will there be guidelines to the new ruling? for example, will there be a set price (or at least an understanding among brokerages) as to the different services that will be provided, and "cost" associated with those services - i.e the standard 5% comm fee

    I'm interested to see how people will undermind each other now that the flood gates have opened... Hopefully, we can all work together to keep the MLS system clean - ensure that all of the information uploaded into the system is accurate and complete. Maybe customers who only wish to have their listings on MLS should HAVE to fill out the SPIS?

    Just thinking out loud :)... great post BTW

    Vahab

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