Competition bureau unhappy with CREA rule changes

Competition bureau unhappy with CREA rule changes

Following the Canadian Real Estate Association announcement of new rules that would allow agents to post a client's listing on MLS for a flat fee, the federal Competition Bureau hasn't changed its position that the CREA's rules are restrictive and deter competition.

"There is nothing in these proposals that we haven't seen before and they do not solve the problem," Competition Bureau commissioner Melanie Aitken said in a statement.  "They are a step in the wrong direction...These amendments amount to a blank cheque allowing CREA and its members to create rules that could have even greater anti-competitive consequences."

Before the changes, anyone who wanted to post their home on MLS had to hire an agent and pay out a commission to that agent upon the sale of the house. But, as the real estate blog Move Smartly put it, this system led the Competition Bureau to believe the CREA is forcing consumers to accept services they may not want to get their house listed on MLS, which is reportedly responsible for 90 per cent of home sales.

According to the Toronto Star, the Competition Bureau is concerned the wording of the new rules - which says additional Realtor services will be regulated by CREA and local boards - means the latter could also impose their own anti-competitive rules. The CREA has until March 25 to respond to the Competition Tribunal, and the association has already expressed dismay.

"We've done everything we can, short of shutting down the MLS system," CREA outgoing president Dale Ripplinger told the Star before yesterday's vote. "We still have to have some rules in place. I don't think the rules were anti-competitive to begin with, but this is supposed help to make things clearer."

RELATED

Competition bureau aims to make property listings cheaper

9 Comments
  • gail 2010-03-25 2:49:32 AM
    it is about time, commisions on a sale are indencent..take Vancouver for instance, the realtor is making $30000.00 listing commisions and it is even a stretch to have them return a phone call. Talk about robbery!!!!
    Post a reply
  • DanP 2010-03-25 3:25:41 AM
    If MLS was designed as a public tool, then the public should have full unobstructed/unconditional access to that tool. If an access fee is imposed, so be it. One should not forget however that, an individual who searches for real estate agent representation, is not doing so just for the MLS listing, they are looking for the suite of professional service offered by a RE professional. I cannot believe that, by allowing MLS access at large, that this would change market needs that drastically.
    Post a reply
  • Matt 2010-03-25 4:44:36 AM
    MLS was not created to be a public tool, it was created to be a way for REALTORS to share information and work together in selling properties. MLS/REALTOR.ca is simply the forum for advertising these listings to the public. I do agree though that the majority of sellers still want full service and are willing to pay for it, after all, there are already plenty of discount brokerages who are offering flat fee listings but most sellers do not go this route.
    Post a reply