When the Supreme Court of Canada refused to hear a recent case involving the Toronto Real Estate Board (TREB) concerning whether to make sales information from its Multiple Listing Service (MLS) publicly available, it appeared that the matter had been settled once and for all. Or had it?
Many real estate professionals continue to express concerns about a 2016 ruling by Canada’s Competition Tribunal that ordered TREB to allow online access to sales data found on MLS that had previously only been accessible to Board members. The Competition Bureau’s ruling makes the negotiated price available before closing, along with the seller’s name and commission paid to the selling agent. That ruling sparked a series of legal challenges that wound their way up to the country`s highest court before it declined to hear the matter.
"The decision by the Supreme Court effectively upheld the original ruling by the Competition Tribunal, meaning that the real estate information on MLS is now being made available online through a realtor’s virtual office website," says Richard Silver, a Global Real Estate Advisor at Sotheby’s International Realty in Toronto. "Access is password protected to the client and provided by the agent."
Sellers are concerned about their privacy
For many in the industry, this development represents a further loss of control at a time when real estate agents in Canada are under assault from websites that enable people to list their home for sale. For others, the situation could compromise the privacy of sellers in Canada's biggest city. While people might like seeing information about their neighbour’s home online, they are generally protective of their own privacy. There is now a move afoot by many privacy concerned sellers to move to exclusive listings rather than MLS.
For years, the MLS served as a valuable repository of information on homes in the Greater Toronto Area. It was accessible to real estate agents who were members of TREB. The MLS has information on homes for sale, as well as historical information on important items such as previous sale prices. Real estate agents used this information to determine the fair market value of a house or property, and to advise their clients appropriately when setting a sales price or making a purchase offer. Richard says:
The information contained in MLS had always been accessible through a TREB member. But now, with TREB’s legal appeals exhausted, house and property information are likely to end up on any number of websites and online databases.
People looking to buy a home or land are now free to do their own research, meaning they can decide for themselves how much to pay for a house, condo or acreage. The question that continues to be debated within the real estate industry is whether this situation represents a victory for democracy and the open and transparent sharing of information, or a threat to peoples’ privacy.
Sold data becomes publicly available to everyone
Sold data is publicly available after closing to everyone through the Municipal Property Assessment Corporation (MPAC) and Geowearhouse. The concern is about displaying negotiated prices online prior to closing. TREB does not get notified of closed prices, and sometimes prices change at time of closing.
Ultimately, how this shakes out and its impacts depend on who you are in the debate. Going forward, realtors will have to adapt and be creative to survive in this new world order. Real estate agents continue to offer valuable services ranging from logistics and home staging to negotiating tactics and contract development. But now, agents may also see one of their roles as being guardians of their clients’ privacy. Realtors must be more of an interpreter of the myriad of data that is out there and tie it to neighbourhood knowledge.
It's less about the search these days and more about the interpretation of the available data
Many realtors have already become less about searching for properties and focus more on interpreting real estate data for their clients. That focus enables agents to provide value added services that are desired by people buying or selling a home – many of whom may choose a private listing to safeguard their privacy.
"In the end, all parties involved in real estate transactions in Greater Toronto will have to change their behaviour and how they navigate what remains the largest and most significant purchase of most people’s lives," says Mr. Silver.
Realtors can still play a role, but it may prove to be more of an advisory one than directing a sale or purchase from start-to-finish as in the past. After all, the search has been minimized in importance in recent years as data has become more readily available to consumers.
Another interesting aspect in all of this is the role that technology is playing in the evolution of Canada’s real estate industry. Realtor.ca and U.S-based Zillow are moving quickly to make real estate information in Greater Toronto available – and seeing huge spikes in their web traffic as a result. The future, at this point, seems uncharted and exciting.
What is clear is that there is no escaping the future, or present for that matter. Now that a precedent has been set with TREB – Canada’s largest real estate board – most industry analysts expect that it is only a matter of time before other real estate boards are also challenged and forced to make sales and other information publicly available. As always, it is best to be ahead of the curve than behind it in these matters.