Major changes coming for organized real estate

Wednesday, April 18th, 2012

Carrie Brodi

CREA members have given the thumbs up to a new vision for organized real estate in Canada, one in which technology is cutting-edge, internal decisions by boards and associations are made quickly, and consumers have access to detailed, high-quality information. In total, the plan offers 23 recommendations for change, all of which were approved for further study at CREA’s Annual General Meeting in Ottawa at the end of March.

Some of the proposals, such as having a third party operate and CREA’s technology services and a restructuring of the country’s MLS systems, are likely to be controversial.

“The acceptance of the plan is only the first step,” says Gary Morse, immediate past-president of the association, and a key driver of the Futures project. “The next questions we need to answer are, what changes do we make, how do we make them, and over what time frame?”

To determine those details, an implementation team is being struck this month. It will be made up of leaders of organized real estate from all levels, and their job will be to identify and create smaller working groups to study each of the propositions in detail. Those working groups will put together a set of proposals, timelines and recommendations for the Special General Meeting in Winnipeg this fall, when motions could be voted on or tabled for even further study.

Technology is one major area for proposed overhaul. The plan advocates for the restructuring of the 80-plus MLS systems into a single, national data feed. The new system would represent a centralized catchall for high-quality data, currently only available to Realtors on MLS systems at the local level.

The plan also envisions creating a mechanism by which for sale by owner and non-MLS data could be made available on

 “Consumers are more informed than ever,” says Morse. “We have to make sure we are providing them with the best information in an efficient manner.”

Also under consideration is the prospect of having a third party operate and CREA’s technology services, something that could offer potential revenue streams while also keeping pace with the rapid changes in technology.

To make the decision-making process more streamlined, the Futures plan also proposes an outside review of the 100 or so boards and associations in organized real estate to determine if roles and responsibilities currently allocated to each level are appropriate or necessary.

Phil Soper, president and CEO of Royal LePage, attended some of the Futures planning sessions. He says he heard “some amazingly frank discussions with the executive officers of some boards, where people have agreed that we have too many boards in the country and that there should be consolidation. And as they are looking around the room, they know a significant number of them are going to be out of a job.”

Don Lawby, president of Century 21 Canada, says he is in favour of some of the propositions pertaining to governance and technology, but cautions CREA against creating a homogenized, one-size-fits-all plan.

“The industry is made up of a significant number of competitors and they need the ability to differentiate their services,” he says. “CREA needs to provide the tools, systems and programs for the industry, and the industry needs to modify them to give themselves a competitive advantage in the marketplace.”

Morse says proposed changes must be inclusive of all members, and cannot be focused on the interests of one group (franchisees and franchisors) over another (independent brokers and consumers).

“We have to be better at what we do for our members while taking into consideration consumer needs and expectations,” he says.

But Soper says that with the national real estate brands controlling more than 90 per cent of residential real estate transactions, the franchisors are watching developments closely. “I think CREA is doing exactly the right thing in stepping back and evaluating what they stand for to their members and consumers,” says  Soper. “If CREA focuses on providing services to its members, I believe they are going in an excellent direction. If they decide to get into retail consumer real estate services, I believe it’s a mistake.”

Lawby is also unconvinced that CREA should be involved with customer service or selling, something he does not view as the association’s core function. For example, he questions how a proposed “Rate your Realtor” mechanism on the CREA site will be used. Will feedback go to the sales office or stay within CREA? The latter, he says, is problematic because Realtors don’t work for CREA.

“It’s one thing to have a plan on paper, but it’s another to explain exactly how it will work. The devil will be in the details,” Lawby says.

Morse says the details will be the focus of working groups this summer. Those groups of people, chosen by organized real estate as experts in a particular area such as technology, will evaluate the feasibility and workability of each recommendation and present their findings at the October assembly.

CREA is promising many ways for members to learn about the issues and engage in the debate. The CREA website will offer various online and mobile tools like micro-sites, forums and phone apps in the coming weeks and months to provide members with avenues to provide their own ideas, suggestions and feedback.

“Realtors would be wise to pay attention to this process,” says Lawby. Having attended the AGM in Ottawa not knowing what to expect, he walked away believing in the value of the process, one that he describes as “good”. He encourages Realtors to get involved and make their voices heard.

As for the value that the Futures plan offers to members: that is not yet quantifiable, either fiscally or in terms of relevance of Realtors in the minds of Canadian consumers.

 “The value today is the fact that we are doing this,” says Morse. “Down the road, the value will be the benefits that come as a result of the outcome of these recommendations.” 

Soper says, “With various regulators and our own members saying it’s time for a change…we know it is the time to take some bold steps.” with files from Jim Adair


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