Note: These are the personal thoughts of a respected colleague whose October newsletter has summed up this issue perfectly. I am sharing them with you to inform you about the pending case of the Toronto Real Estate Board and the Competition Bureau.
At the end of the month (Oct 29th) the Canadian Real Estate Association will be voting to resolve a battle with the Competition Bureau. The big question that everyone wants to know is how this will change the landscape of Real Estate in Canada.The answer is not very much…there have always been options for sellers whether it has been to sell privately, or to list with REALTORS® or Brokers who provide a multitude of services. I think that a lot of Sellers who would have previously chosen the “private for Sale” option will now be placing their properties on the MLS system with brokerage models who only offer that option.The misconceptions are out there: some consumers think that full service companies will now be forced to list properties on the MLS with little or no service or a schedule of services. This is not the case. It is up to the Owner/Broker to decide what offerings they will make as part of their business model.The BIGGEST misconception is that the Seller is the one paying the commission…think about the transaction. It is the Seller who writes the cheque but the price of the house is paid by the Buyer and the commission is deducted from that price. The Seller wrongly thinks that they are benefiting, but the benefit really goes to the Buyer….it is the Buyer who gets the lesser price to be paid and the Seller may be disadvantaged by not having a full marketing program.As a REALTOR®, I see myself as a marketer and negotiator providing services for a fee. If some Sellers feel that they can manage that part on their own, then I wish them all the best. It has taken years to develop a successful marketing plan. Good REALTORS® make it look easy, we act as a buffer and try to keep a very difficult process as calm as possible.Like any service well done it has lead consumers to think that the process is easy. Some consumers see the transaction as the only time we work; They don’t see the hours of preparing the house for sale, research to get the proper asking price, months of showings with buyers to educate them, licensing, ongoing education and insurance; one of our biggest jobs these days is to make sure that Bona Fide clients are exposed to the property and that clients do not lose proper perspective when negotiating.Unrepresentated Sellers would be well advised to hire a lawyer and use their services. However they should be prepared that Lawyers charge whether the Property sells or not whereas REALTORS® fees, for the most part, are charged on a successful completion of the transaction.There will be some confusion for a while as Sellers, REALTORS® and Buyers get used to some of these changes and some behaviours will have to change. Buyer Representation which involves a service contract between the Buyer and their agent, will become more and more important as it solidifies the fiduciary duty of the agent to the Buyer.Good agents will continue to offer many services to their sellers and Buyers. At the end of the day, competition allows great service providers to shine and this discussion is all about service.
