Today's top stories from Report on Business :
Competition Bureau challenges MLS rules
The Competition Bureau is trying to strike down rules governing the multiple listing service, or MLS, system that's used by most home sellers to list their properties. The MLS system includes information available only to members of the Canadian Real Estate Association, which is too restrictive, the bureau said in a statement today. The regulator also wants consumers to be able to pay a fee to list homes without being obliged to take a host of other services, which could lower the MLS fees, and negotiate property sales without using an agent. The bureau has filed an application to the Competition Tribunal, which will decide the matter. The watchdog said it attempted to strike a deal with CREA, but that failed and it will now seek to kill the rules it deems "anti-competitive."
"While the market will ultimately determine prices for residential real estate services, we expect that if the Tribunal strikes down the anti-competitive restrictions, there will be downward pressure on real estate fees in Canada," said Melanie Aitken, the Commissioner of Competition.
Housing market heats up
While CREA heads for a showdown with the Competition Bureau, the market continues to heat up. CREA projected in a new forecast today that resale house prices would rise 5.4 per cent this year to a record average $337,500, as sales increase more than 13 per cent from last year to also hit a record, at 527,300.
Separately, the market for new homes is beginning to show the same bounce that led to the remarkable recovery in resales after the slump. Canada Mortgage and Housing Corp. said today that housing starts in January jumped 5.8 per cent to a seasonally adjust annual rate of 186,300, with gains in both single homes and condominiums. The jump was led by a surge of almost 20 per cent, month over month, in British Columbia.
"New home sales should taper off in July as buyers are jumping the HST gun in B.C. and Ontario, and those same buyers are also likely pulling forward some purchases given well-ingrained expectations of rate hikes in the second half of the year," said BMO Nesbitt Burns economist Robert Kavcic. "Given that supply still has some catching up to do, housing starts should hold up around current levels through the remainder of 2010."
Today's numbers are more fodder for those who have been warning about a housing bubble. Some economists have flagged the issue, and the chiefs of the major banks have also warned Ottawa it needs to dampen the mortgage market as prices surge. At the G7's weekend meeting in Iqaluit, however, Finance Minister Jim Flaherty said he saw no evidence of a bubble.
Canpotex strikes China deal
Canada's major potash producers have struck a deal to sell 350,000 metric tons of the fertilizer to China, but they left markets hanging by not specifying the price. Canpotex, the marketing and distribution organization owned by Potash Corp. of Saskatchewan, Agrium Inc. and Mosaic Co., said in a statement this morning it struck a spot sale with China's Sinofert "at competitive prices."
"As a result of this latest spot sale, Canpotex is now fully committed on sales through the first quarter of 2010 and will announce plans with respect to second-quarter pricing early in March, after thoroughly reviewing the changing and much improved overseas potash market conditions," it said.
Potash prices have been depressed as farmers held back buying, and markets have been watching for a deal with China. Last week, Belarusian Potash Co., or BPC, which accounts for about 30 per cent of the global market, boosted its standard grade price to $410 (U.S.) a tonne from $385 for major customers in Brazil and Asia.
China's Zhuzhou bids on Montreal transit