To clarify-none of the opinions expressed in this blog necessarily represent those of Century 21 Canada, Century 21 Classic Realty Ltd, CREA or NSAR-I am however confident that some of my collegues share my concerns.
This Sunday in St. John's NF CREA will hold a national vote to either radify or reject the agreement reached between the itself and the Competition Bureau. Select representatives from each board within its membership will vote to either change the face of real estate trading in Canada or to proceed with legal proceeding brought on by Ms. Atkins on behalf of the Competition Bureau. How will the vote go? Only time will tell.
Now this may seem to be a very democratic method, holding a vote and all, but there are a few issues associated with the whole process. The largest, and the one that I most identify with, is the fact that CREA membership has not been made aware of the details of the agreement. News reports-the best thing we have to go on-have indicated that membership has not been made aware of the details so as not to make public the details should the agreement be rejected and the matter be returned to the courts. Select members from each Board across Canada will vote on behalf of their membership without their membership having any idea of what the concessions are.
At stake is the ability of REALTORS® to maintain both control and integrity of REALTOR.ca as well as to determine their payment structure. Here are a few points regarding the MLS® system; it was developed and designed for/by REALTORS®, it was paid for and continues to be paid for by REALTORS®, it is the legal property of CREA and by association, REALTORS®.
From what little information that has been shared with us one of the biggest consessions CREA is making is the utilization of the MLS® to post for sale by owner offerings. Essentially REALTORS® can be paid to post a listing on the MLS® system for which they are not the listing agent. The listing on the system will appear as though they are the listing agent however when they are contacted for additional information or to book viewings they will be referred to the homeowner. Sounds simple almost doesn't it! It is anything but simple.
There are major legal implications associated with such a transaction. REALTORS® are legally responisble for the data that they put on MLS®. If we start lising homes that are for sale by owner, where we are solely hired to post their homes, we will have all the legal responsibilities and no control over the data they provide. This could lead to legal cases brought on by both the future buyer and /or seller of the property should any information provided be inaccurate. It is the REALTOR® who stands to loose everything either through increased insurance premiums or personal liability.
We're talking about trading in our Matrix for a new Tacoma Truck come spring-being beekeeper we really do need the cargo space offered by the truck. So, would it be un-reasonable for us to purchase the new truck at O'Regan's Toyota then park our Matrix on their lot and sell it privately?? Think they would let us do it? Being a dedicated Toyota family we have bought several vehicles through them over the years shouldn't be an issue!
Next time you go to the Dentist you should request that he/she administer the novacaine and let you use his/her equipment to drill and fill your own teeth.
Both of these examples seem extreme huh! Well, they are no different than what is being asked of us REALTORS®. Use our equipment, and our names, and put our insurance at risk and expect us to simply agree like a herd of cattle.
As far as the ability to negotiate commission is concerned we have always had the ability to do so. Most of us work for a commission rate of 5-6%; HALF of which generally goes to the REALTOR® working on behalf of the other side of the transaction. For example, if you are selling a $250,000 property the commission you would be responsible for paying is approximately $12,500 of that $6,250 goes to the selling side. Your REALTOR® would then share his/her commission with their brokerage and subtract all their related expenses before ending up with a pay cheque. Some of these fees include licensing fees, errors and ommissions insurance, MLS® monthly fees, vehicle expenses, commercial insurance, fuel and advertising expenses. Perhaps the most paramount reason REALTORS® charge the commissions that they do is because they have to in order to make a living. Despite what most people think most REALTORS® are not millionaires or living 'high on the hog'.
Regardless of what I may think only time will tell how the face of the real estate industry will change in Canada. Until then I guess we just have to wait to see what happens in St. John's and say a few prayers.