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Radical changes coming for CREA

JDaley

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QUOTE (Cargren @ Feb 10 2010, 11:42 AM)
I am not a Realtor and dislike paying fees just as much as the next guy, but Brett is right. What some seem to think is that mls.ca is a public or government owned service/entity. IT IS NOT. It is privately owned and subject to the market. Sure is dominates the RE scene, but that was not always the case, and anyone is free to develop a rival system. We have the option of using it or not. If you don't think CREA realtors don't bring something to the table don't use them!




The key words in the CB allegations are "The CREA controls access to the MLS system in Canada." Let me put it to you this way, lets say a colored man and his family wish to rent your home you have listed as a rented property at the asking price and you reject or ignore the offer because of his color (you don't want colored people living in your home); you may find yourself in front of a court explaining your actions and possibly paying damages. This in a nut-shell is at the heart of the complaint ie., exclusion resulting in excessive commission fees. In another example, MS created the most prolific webrowser in IE and in some cases rigged their operating system such that NetScape/AOL and other webrowers didn't function well. After the Microsoft antitrust case found that Microsoft held and had abused monopoly power, AOL filed a suit against it for damages. This suit was settled in May 2003 when Microsoft paid $750 million US to AOL and agreed to share some technologies, including granting AOL a license to use and distribute Internet Explorer royalty-free for seven years. This is a similar case and the CB will point to the excessive commission fees paid by sellers, specific cases of abuse (3 year investigation of the CREA) and the near market monopoly imposed by the CREA to win its case - and it will win.
 

MikeMcC874

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QUOTE (RedlineBrett @ Feb 10 2010, 02:18 PM)
Regarding paying for data a good realtor will give this to you however you want it. One thing CREA does exceptionally well is store data and operate a sales database. I have an engineering degree and am a total datafreak and I continue to be impressed by the robustness of the MLS sales database.




I do not want to to pay to have someone else do it. I want to pay to have access. They are 2 very different things. I have a CS degree and am also a total datafreak. I want the ability to write automation that will assist me in finding the properties I want to pursue.



The backend may be good but the public facing website is absolute crap.



I don't have a problem with someone earning a living if some are willing to pay. There will always be people too timid or too busy to 'do it themselves'. They will always exist, open data or not. The cost of hiring someone to help me sell a 350,000 house is equal to the cost of buying a new Hyundai Elantra. Have to think long and hard on that one...



Mike
 

JamesB

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QUOTE (JDaley @ Feb 9 2010, 12:33 PM)
Typical realtor, bullying and pushy. I hope you ain't trying to intimate me or worse, threaten me. I had a friend that worked at a realtors office and her comments were that she'd never buy a home from a realtor after what she witnessed. Slander really, I can pick out anytime an MLS listing information that's incorrect or misleading, such as claiming a unit is LEGAL when its not. In fact I'm looking at one now. Realtors demand outrageous fees for little in return, hell my lawyer does twice the work of a realtor and gets compensated for a fraction. Give me a break.




Hahaha



That is the first time I have heard someone hold a lawyer in higher regard than anyone/anything else! Hahaha (Everyone loves a good lawyer joke...right?)



I feel so loved!
<
 

Lucas

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Hey JD,



I tried my best to slip it in there unnoticed (lol)...I am on this board quite frequently doing my best to help people. Your comment seemed pretty slanderous so I though I would chime in to defend what I do...



Real Estate agency is an old industry...if Realtors were redundant, overpriced and useless, the industry would have dissipated years ago...if anything, in todays competitve Real estate market, the industry has flourished b/c the average seller/buyer WANTS to consult an expert before getting into (or out of) a Real Estate investment. Don't you agree with this?? If not, what are your thoughts on this??



MLS is controlled privately by a private body...just like Honda, Starbucks, MS, Apple...why would CREA relinquish its competitve advantage? That all it isi...just like KFC and Coke have recipe secrets, CREA has MLS.



Not too mention, entrance into CREA isn't that difficult...why don't you get a licence to trade RE in your respective market? I think if you tried to be an agent or Mortgage Broker of PM, you would realize quickly that its not easy money.



Lucas



Just a side note: As a seller, if you list with a realtor, you are given the option of "Seller's Rights" in which you can find the buyer on your own and the sale would be exempt of commission.






QUOTE (JDaley @ Feb 10 2010, 09:51 AM)
Lucas, no anger here, would just like to see fair play for the good of us all - btw I was wondering when you would insert a dig at me while reading your post lol.



But great suggestion, real good idea, I never thought of it in the 15 yrs I've been investing in Real Estate, a negotiated commission! So what do you think a new rate would be if I negotiated a new commission with a realtor ? $5,000 discount on a $1M transaction ? So I'd pay $35,000 instead of $40,000 ? Wow I'm rolling in my money now. I only pay a realtor $35,000 instead of $40,000. Or lets say $30,000 (which a realtor broker would never agree to do). The fact is I've tried this approach in the past, and the important thing you left out of your post is that the Realtor immediately warns you that by lowering commissions your property will receive less interest from other realtors - not to mention irritating the realtor for a reduced fee structure. This is why the Competition Bureau needs to fix this problem. By regulating the RE market to some extent, in a fair and balanced way, the market will thrive since moderating excessive commissions is equivalent to a tax break. Other realty specialists such as WeList should be allowed to list on the MLS or some other similar broad based system so that buyers and sellers have access to the entire market.







From these posts, it appears in some cases, Realtors on this board aren't here to help us as much as advertise their services ` sorry but this is the hard realty of this topic.
 

RedlineBrett

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QUOTE (JDaley @ Feb 10 2010, 12:34 PM)
the heart of the complaint ie., exclusion resulting in excessive commission fees. the CB will point to the excessive commission fees paid by sellers, specific cases of abuse (3 year investigation of the CREA) and the near market monopoly imposed by the CREA to win its case - and it will win.




You're still missing the point. The CB isn't looking one bit at how much realtors are making and deciding it is too much. Microsoft didn't have to reduce the sale price of windows right? They just had to share their technology with competitors.



All the CB is after is a reduction in the standards of service that realtors provide - CREA mandates that a broker must be involved in the listing of any property on its database to ensure that the public is being protected due to the data being accurate and warranted to be so. This is because that brokerage has to abide by the CREA code of conduct and must list the property according to the rules it sets out for CREA members. This means that there is no bargain basement option - to just list your property on MLS without being responsible for the data on the add or treat inquiries the way CREA wants its agents to. The CB wants to put a stop to that base level of 'quality control' and allow consumers the right to list their property on MLS without having to pay for the broker to be there to ensure that the property is being properly represented and that offers/questions are dealt with in a fair and professional manner.



Taking away that quality control could turn the real estate industry into the wild west (see globe article) and may not be something that CREA is prepared to do... And may look at a number of different alternatives.
 

gwasser

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QUOTE (MikeMcC874 @ Feb 10 2010, 01:18 PM)
I do not want to to pay to have someone else do it. I want to pay to have access. They are 2 very different things. I have a CS degree and am also a total datafreak. I want the ability to write automation that will assist me in finding the properties I want to pursue.



The backend may be good but the public facing website is absolute crap.



I don't have a problem with someone earning a living if some are willing to pay. There will always be people too timid or too busy to 'do it themselves'. They will always exist, open data or not. The cost of hiring someone to help me sell a 350,000 house is equal to the cost of buying a new Hyundai Elantra. Have to think long and hard on that one...



Mike




Excuse me, since you are making the car analogy. When you trade that Hyundai in to a car dealer, how much is the dealer going to mark up that car for sale? 30-40% Compare that to a realtor!
 

RedlineBrett

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QUOTE (MikeMcC874 @ Feb 10 2010, 01:18 PM)
I do not want to to pay to have someone else do it. I want to pay to have access. They are 2 very different things. I have a CS degree and am also a total datafreak. I want the ability to write automation that will assist me in finding the properties I want to pursue.



The backend may be good but the public facing website is absolute crap.



Mike




The public facing website is all that is being contested with the competition bureau. If they get their ruling you can be 100% certain that this data will not get any better and content might be restricted significantly. That won't change a lick and the only way to get access to the back end of the data is to pay the fees and put in the time and pass the exams to get a license to use this data. You can sit on it and never do a deal if you want - I know many who do so.. but that's what the cost is now if you really want it.



If it gets opened up someone is going to have to maintain this database or the source data for your automation won't be worth beans. If the courts rule that everyone should be allowed to use it how much this should cost? $1.00? $1,000? 7% of the first $100,000 and 3% of the balance? Who should decide? the government or the entity who has proprietary rights to the software?
 

MikeMcC874

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QUOTE (gwasser @ Feb 10 2010, 04:43 PM)
Excuse me, since you are making the car analogy. When you trade that Hyundai in to a car dealer, how much is the dealer going to mark up that car for sale? 30-40% Compare that to a realtor!






Or i can choose to pay a small fee and post it myself on the industry leading web property which is AutoTrader from what I can tell.



Wow, can you image if all the 'used car salemen' banded together and tried to control the sale of used cars...
<




Mike
 

JDaley

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QUOTE (RedlineBrett @ Feb 10 2010, 02:32 PM) You`re still missing the point. The CB isn`t looking one bit at how much realtors are making and deciding it is too much. Microsoft didn`t have to reduce the sale price of windows right? They just had to share their technology with competitors.Sorry Brett, I don`t think you full understand the significance of the allegations, refer to the following statements in the CB complaint:
Practice of Anti-Competitive Acts:

"CREA`s rules restricting the access to and use of the MLS system prevent or lessen competition in the market for residential real estate brokerage services by excluding competition from brokers and others wishing to offer a reduced set of services ... raising the cost of providing real estate brokerage services;
"

The CB will point to any number of examples where the cost of services is excessive (e.g, paying a commission of $40,000 on a $1M transaction) and recommend a lower cost system (unbundled package of services) with the MLS, for sellers and low cost brokers:

"In contrast to the traditional full service brokerage model, the fee-for-service real estate brokerage models will allow home sellers to pick and choose the services they wish to purchase and pay a flat fee for each service rather than paying a commission equal to a percentage of the home`s sale price.
"

Fee for services or similar models together with access to the MLS should substantially reduce or eliminate the need for pricy realtors controlled by the CREA. This should be enough for the market to correct. Inotherwords, the brokerage business will change as we know it.

There`s little quality control in the MLS, as far as I can tell. Can you illustrate to me how the MLS is quality controlled ? What controls are in place for quality control – are you the architect of the database ? How do you quality control a database ? Do you know what a database is ? Do you know what database the MLS use or its format ? Just as an example, I was viewing a MLS listing the other day where the unit was listed as a LEGAL up down duplex. I investigated, and its illegal. I don`t know if the listing realtor is aware of this, but the information advertised on the listing is not correct.

I don`t think you fully understand the MS Antitrust ruling.
 

JDaley

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QUOTE (MikeMcC874 @ Feb 10 2010, 03:33 PM)
Or i can choose to pay a small fee and post it myself on the industry leading web property which is AutoTrader from what I can tell.



Wow, can you image if all the 'used car salemen' banded together and tried to control the sale of used cars...
<




Mike




<
a Realtor once described his profession as a notch above used-car salesmen.
 

RedlineBrett

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QUOTE Sorry Brett, I don`t think you full understand the significance of the allegations, refer to the following statements in the CB complaint:Practice of Anti-Competitive Acts:
"CREA`s rules restricting the access to and use of the MLS system prevent or lessen competition in the market for residential real estate brokerage services by excluding competition from brokers and others wishing to offer a reduced set of services ... raising the cost of providing real estate brokerage services;
"

This is about those business models that want to provide less services to the public... so ONLY list properties and NOT abide by other brokerage laws regarding agency representation for sellers. Such as dealing with counter offers, multiple offers, insurance for showings etc. So to have that level of service does cost more. The CB wants to take this out and give brokerages the option of offering this low cost option to the public.


QUOTE The CB will point to any number of examples where the cost of services is excessive (e.g, paying a commission of $40,000 on a $1M transaction) and recommend a lower cost system (unbundled package of services) for sellers:

"In contrast to the traditional full service brokerage model, the fee-for-service real estate brokerage models will allow home sellers to pick and choose the services they wish to purchase and pay a flat fee for each service rather than paying a commission equal to a percentage of the home`s sale price.
" Fee for services or similar models together with access to the MLS should substantially reduce or eliminate the need for pricy realtors controlled by the CREA. This should be enough for the market to correct. Inotherwords, the brokerage business will change as we know it.

Fee for service brokerages exist right now. There are discount brokerages and flat fee options already available to the public as well as 100s of other business models. What is being contested is the ability for a home seller to put their house on MLS and not use an agent for anything else.

QUOTE There`s little quality control in the MLS, as far as I can tell. Can you illustrate to me how the MLS is quality controlled ? What controls are in place for quality control – are you the architect of the database ? How do you quality control a database ? Do you know what a database is ? Do you know what database the MLS use or its format ? Just as an example, I was viewing a MLS listing the other day where the unit was listed as a LEGAL up down duplex. I investigated, and its illegal. I don`t know if the listing realtor is aware of this, but the information advertised on the listing is not correct.

Legal use of a property is a constantly changing term subject to municipal law so that is not warranted by the brokerages that put that on... it is warranted by the seller who discloses this to them. If a seller tells me they have paperwork that warrants the property is a legal up down duplex I advertise it as such and get them to sign off on it. Perhaps there is something you don`t know about this listing? Maybe you should call the realtor to find out


The data that goes on the MLS like zoning, lot width, area, size of the property, number of bedrooms, construction, heating type etc. These are things that the broker is inputting on behalf of the seller and are representing the property as such. It is quality controlled because agents are fined for incorrect data all the time. Whereas on welist you`ll see sellers doing things like including basements in square footage or representing their zoning as R2 when it`s RC-2 things like that.
 

JohnS

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QUOTE (JDaley @ Feb 10 2010, 05:34 PM) Fee for services or similar models together with access to the MLS ...


First off, JD, thanks for moderating your tone - I, at least, appreciate it. (And no, I`m not a realtor or anything like that.)

Secondly, you kind of skipped over this sentence. As far as I understand it, there are currently brokerages/institutions/websites that do what you`re talking about, except for the access to the MLS part. They offer different packages, I believe, depending on what you want to get done. The only one I`ve even kind of looked at is grapevine, but anyone can pay a small fee and post their property up there, as far as I know.

But what Brett and others have been arguing (correctly, as far as I can tell), is that the MLS is the private domain of the realtors, so they can do whatever they want there. I`m sure it`s partly to control the content (although some realtors undoubtedly just take the sellor`s word on different aspects) and partly to protect their investment into the system. As others have stated, I can`t just get the recipe to Coke because their having it is detrimental to me. Likewise, I can`t insist that the MLS be opened to anyone who wants to see the backend just because they want to - it`s proprietary.

Or, if you prefer a different analogy, the MLS is basically a system that lots of people buy into. Kind of like tv, or the radio. And, similarly, I also can`t insist that the big cable companies let me advertise for free (or almost free) just because I want to, or because they have an advantage over me. They put in the time, money, and resources to develop that advantage. But just as other means of advertising exist, so do other means of selling or buying a property. You can list with discount brokerages, go on Grapevine, do it for free on Kijiji, trade a red paperclip for a house, or negotiate the fees with a realtor. Lots of options exist already, but I know that most of the time, I`ll pick using a realtor as it`ll usually be the best option for me.

Have a good one!

JohnS
 

MikeMcC874

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I am officially dropping off this thread as I was hoping for an open discourse but can see that this thread is going to cause some hard feelings.

That is not my intent.

Mike
 

JDaley

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QUOTE (RedlineBrett @ Feb 10 2010, 03:51 PM) Fee for service brokerages exist right now. There are discount brokerages and flat fee options already available to the public as well as 100s of other business models. What is being contested is the ability for a home seller to put their house on MLS and not use an agent for anything else.

Yes I agree fees for services are already in place, I said that in my post. The CB is asking fees for services + access to the MLS which should be enough to eliminate pricy realtors on fixed commissions controlled by the CREA. The whole point of the CB complaint is to reduce commissions in order to reduce total costs to the seller - that`s the whole point of competition (ie., reduce costs to end users).


QUOTE (RedlineBrett @ Feb 10 2010, 03:51 PM) Legal use of a property is a constantly changing term subject to municipal law so that is not warranted by the brokerages that put that on... it is warranted by the seller who discloses this to them. If a seller tells me they have paperwork that warrants the property is a legal up down duplex I advertise it as such and get them to sign off on it. Perhaps there is something you don`t know about this listing? Maybe you should call the realtor to find out


Sorry this doesn`t cut it, its no excuse, its the realtors respondibility to ensure the listng is factually corrrect. No I didn`t contact the realtor because the City said it was illegal and that`s good enough for me.

QUOTE (RedlineBrett @ Feb 10 2010, 03:51 PM) The data that goes on the MLS like zoning, lot width, area, size of the property, number of bedrooms, construction, heating type etc. These are things that the broker is inputting on behalf of the seller and are representing the property as such. It is quality controlled because agents are fined for incorrect data all the time. Whereas on welist you`ll see sellers doing things like including basements in square footage or representing their zoning as R2 when it`s RC-2 things like that.

This is bs, many brokers don`t know most of the land zoning rules
. RC-2 and R2 are basically the same (two dwelling units), except if the property is located in a developed area, you need a DP - but its the same. R2/RC-2 are simple examples. And what difference does it make, as I pointed out, the MLS doesn`t have quality control to speak of (unless a complaint is made?) - maybe this is an area that can be improved by a programmer adding a new front end with better controls. This is not say I don`t make use of MLS data, but rather one needs to be careful when using it.
 

gwasser

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QUOTE (MikeMcC874 @ Feb 10 2010, 03:33 PM)
Or i can choose to pay a small fee and post it myself on the industry leading web property which is AutoTrader from what I can tell.



Wow, can you image if all the 'used car salemen' banded together and tried to control the sale of used cars...
<




Mike




Exactly the same for real estate only at a lot less commission (percentage wise).
<


BTW nobody stops you from setting up 'House Trader' or a similar website.
 

JDaley

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QUOTE (Lucas @ Feb 10 2010, 02:29 PM) Hey JD,
I tried my best to slip it in there unnoticed (lol)...I am on this board quite frequently doing my best to help people. Your comment seemed pretty slanderous so I though I would chime in to defend what I do...

No offense taken
I`ll try to be less slanderous, I like to think of it as saletous lol

QUOTE (Lucas @ Feb 10 2010, 02:29 PM) Real Estate agency is an old industry...if Realtors were redundant, overpriced and useless, the industry would have dissipated years ago...if anything, in todays competitve Real estate market, the industry has flourished b/c the average seller/buyer WANTS to consult an expert before getting into (or out of) a Real Estate investment. Don`t you agree with this?? If not, what are your thoughts on this??

Agreed, never said to eliminate relators (although I haven`t used one in a while). I`m simply advocating an adjustment to broker fees that everyone (except relators) agrees are far too high. In fact I think its pointless for realtors to argue this point, since it doesn`t help them - look at Brett, he`s so worried about lossing his commissions he can`t even read a complaint properly.

QUOTE (Lucas @ Feb 10 2010, 02:29 PM) MLS is controlled privately by a private body...just like Honda, Starbucks, MS, Apple...why would CREA relinquish its competitve advantage? That all it isi...just like KFC and Coke have recipe secrets, CREA has MLS.

I don`t think the CREA is a KFC or drive through operation.

QUOTE (Lucas @ Feb 10 2010, 02:29 PM) Just a side note: As a seller, if you list with a realtor, you are given the option of "Seller`s Rights" in which you can find the buyer on your own and the sale would be exempt of commission.

Good point! Thanks.
 

RedlineBrett

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QUOTE Agreed, never said to eliminate relators (although I haven`t used one in a while). I`m simply advocating an adjustment to broker fees that everyone (except relators) agrees are far too high. In fact I think its pointless for realtors to argue this point, since it doesn`t help them - look at Brett, he`s so worried about lossing his commissions he can`t even read a complaint properly.

Good grief... I was going to continue going over this with you but this is the second time you`ve taken a personal shot at me. Finished replying to your posts from here on out.
 

wealthyboomer

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QUOTE (RedlineBrett @ Feb 10 2010, 03:51 PM)
Whereas on welist you'll see sellers doing things like including basements in square footage or representing their zoning as R2 when it's RC-2 things like that.




There are lots of MLS listings from BC that have the basements included in the square footage.
 

Pete6510

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QUOTE (RedlineBrett @ Feb 10 2010, 10:23 PM) Good grief... I was going to continue going over this with you but this is the second time you`ve taken a personal shot at me. Finished replying to your posts from here on out.
WOW, I`m surprised you kept going this far Brett!!!
 

wealthyboomer

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QUOTE (JDaley @ Feb 10 2010, 07:16 PM) I`m simply advocating an adjustment to broker fees that everyone (except relators) agrees are far too high.

Just think of all the Sellers whose commission payments pay to buy and build all those large expensive Realtor Board Buildings, CREA property, and extensive CREA legal fund which will be used to fight the Competition Bureau. That is a lot of $$ that didn`t add to the Sellers bottom line.
 
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