A new fight threatens to break out between the country’s real estate agents and the Competition Bureau, this time over the way the industry handles the treasure trove of data generated by each sale on its Multiple Listing Service.
The Canadian Real Estate Association recently ratified a deal to open the MLS to those who want to pay a flat fee for a listing, and then handle the rest of the sale on their own. But that isn’t the end of the bureau’s interest; industry sources say it is also examining whether the data agents generate and keep in the password-protected section of the MLS should be made available to anyone listing with a flat-fee brokerage.
Access to data is important to those handling their own sale because it helps them decide what their property is worth.
The information includes such items as prior sale prices, comparable sales numbers and days-on-market data. The statistics are vitally important in setting prices, and for gauging the health of a neighborhood’s real estate market.
Realtors are the gatekeepers of that information, and consumers can only access it by contacting an agent directly. But those who run flat-fee brokerages want that information to be automated, so they don’t need to interact with their customers once the listing has been put online.
“You could understand why the Competition Bureau would want to take a hard look at data,” said Queen’s University real estate professor John Andrew. “The real estate industry still has a stranglehold on the numbers generated with each deal, and they don’t share that information easily.”
The real estate industry in the United States has already gone through these changes. First, regulators forced agents to allow easier access to MLS for those who wanted to post flat-fee listings. Then it compelled real estate boards to automate the way data was disseminated by decreeing that anything that could be given out in person or on the phone could also be distributed electronically.
Lawrence Dale, who said he was forced to shut down his Realtysellers website in 2007 because of anti-competitive rules in the real estate industry, recently relaunched the site and is offering free MLS listings and rebate programs for buyers.
Making data available to his customers is key to his business plan, he said, because it helps them study the market without him spending time acting as an intermediary.
“Consumers want to receive this data in the most time-efficient manner and I am determined to be able to give consumers what they want,” said Mr. Dale, who said he has met with the bureau “extensively” as part of its investigation.
The Competition Bureau declined to comment because its investigations are confidential. Not all investigations lead to charges.
“We have a number of inquiries ongoing at any time in a number of industries and unfortunately we are required to do those in private,” said Competition Commissioner Melanie Aitken.
The Canadian Real Estate Association said it wasn’t aware of any further inquiries that would affect its 100,000 members.
“We plan to return to a working relationship with the bureau based on co-operation and consultation, such as we had in the past,” the association said in a statement. “We assume they will do the same.”
Those in the industry point out that much of the information that is hidden on MLS, such as prior sale prices, is available through other channels such as land registry offices.
Phil Soper, chief executive officer of Brookfield Real Estate Services – which operates Royal LePage in Canada and Real Living in the United States – said the American settlement opened up data in a way that small players may not have expected.
“The main challenge is that the data suddenly feeds right into some really good sites,” he said. “You’re not only competing against brokerages anymore, you’re competing against eBay and other huge companies that know a thing or two about data. It creates a very big challenge for a small Canadian upstart.”