Do you still need a Realtor now that MLS is open?

Sutton Quantum

In recent years, the Competition Bureau climbed over the Oligopolies and Monopolies and, with rabid determination, waged battle with the Real Estate industry to ensure that the consumer had adequate service options and that Realtors had various levels of representation options across the country.

I have to say that as a Realtor in Ontario over the past 20 years, I had not noticed a shortage of creative Realtor options in my marketplace. Admittedly, there were some oddities in the structure of commissions in our marketplace. For example, we were not permitted to mix flat fees with percentages when deciding on the total commission split between the listing and buyer brokerages. This rigidity was the direct result of the Act and since that was recently amended in Ontario. There was also the requirement through the pillars of an agency relationship to be established between the seller and the Brokerage for any property on an MLS system. The CB did not like that very much.

So what has changed? Can the public access MLS? Well, in a word…no. What has changed is the ability of the Brokerages to post a listing without a fiduciary relationship with the seller. How this is a win for the consumer is still unclear. In one swoop, the Bureau changed the landscape for the For Sale by Owner sector irrelevant (likely a blessing for them as NAR studies indicated the For Sale by Owner typically left 15.4% on the table, no E and O, no security from screened buyers and all the work, ouch). Ultimately, the posters and the FSBO groups united to form a FSBO/Poster-Brokerage hybrid. Realtors, being the hardy bunch we are, are still trying in earnest to learn how to deal with these guys.

It is clear that they all have a place in the market but the consumer needs to make an informed decision as to what is an appropriate level of representation for them and what this all means.

To further add to the discussion, the consumer should understand that the sale ratio on MLS is 4:1 in a balanced market on average. So that means 4 don’t sell? Well, yes. But the Posting companies charge a fee regardless of the outcome. Traditional Realtors are commissioned on the successful sale. So you may pay a poster and then have to hire an agent to represent you if the post alone doesn’t work. Make sure you understand the policy around that.

Now that we have opened up the option to the Realtor to offer a fee per service and itemize the fiduciary from the non-fiduciary, will we see the emergence of the retainer in Real Estate? Perhaps it is time to introduce a posting fee for alllistings? The posted listings are intended to expose the property to the buyer agents and to access Realtor.ca. While that is not the same as MLS (I know, everyone thinks it is but it isn’t) it is a public site and the agent and the seller decide if the property should be uploaded to this site. MLS is the Realtor tool and it is exclusively for Realtors and is the only database with all of the active listings.

To get posted to the public site you need to get a Realtor. They can represent you or not represent you but ....you still need a Realtor.

Tina is the Broker Owner of Sutton Group Quantum and home of The New Age Agent Program TM www.suttonquantum.com