The CEO Poll: Real estate rumble
Joe Castaldo
Canadian Business Online
April 1, 2010
CEOs weigh in on competition in the real estate industry.
The Canadian Real Estate Association and the Competition Bureau have for months been locked in a debate over the Multiple Listing Service (MLS). A panel of Canadian CEOs recently surveyed by COMPAS Inc. supports the Competition Bureau’s efforts to open the MLS.
CREA owns and operates the MLS, and the vast majority of home sales in Canada go through the system. Only registered agents can list on MLS, and the Competition Bureau argues the current system restricts the consumer’s ability to buy and sell without a real estate agent. CREA has refuted the claims, saying it has already made changes to loosen restrictions on the MLS.
Nearly two-thirds of the business leaders surveyed by COMPAS argue property sellers should be able to list on the MLS without having to use a listing agent or realtor. The same portion agreed the Competition Bureau’s assessment of the MLS is a “perfect example” of an agency protecting the right of Canadians to receive choice in services and prices.
“It is time we got some competition in this business,” wrote one respondent. Other panelists commented on what they saw as high agent commissions. “The effort required to sell a house today is no different than 10 or 20 years ago,” wrote one. “Despite a small decline in the commission rate, the fees they receive far exceed inflation and are now a major consideration when selling a house.”
COMPAS noted that without concern about real estate fees, support for the Competition Bureau might well be lower. Indeed, some panelists saw the actions of the Competition Bureau as unfair. “The MLS service is a competitive market advantage developed by CREA over many years,” one wrote. “It is wrong to force them to make this advantage available to their competition.”
To view complete results and additional polls, please click here.
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