Realtors take issue on consumer choice

Sunday, March 28th, 2010

Garry Marr

The Canadian Real Estate Association says allegations it is anti-competitive are “simply false,” according to a legal defence filed with the Competition Tribunal.

The group, which represents about 100 real-estate boards across the country and about 98,000 agents, calls an application filed by Commissioner of Competition to be “fundamentally misconceived” and says consumers already have plenty of choice as to how they can sell their home in the marketplace.

Competition Bureau Commissioner Melanie Aitken filed a complaint with the tribunal in February against the group and its use of the Multiple Listing Service, which is responsible for about 90 per cent of the transactions in Canada.

One of the concerns of the bureau has is that, under CREA’s rules, agents are prohibited from offering consumers the option of simply paying a fee to list a home on the MLS system. Consumers have to opt for an entire suite of services that come with a commission rate of about five per cent, though it differs from province to province.

“Contrary to the commissioner’s allegations, the MLS rules do not prevent entry and impede expansion by competitive business models that provide unbundled residential real-estate brokerage services,” said CREA in its filing to the tribunal.

The association this past week made amendments to its owns rules which would also allow consumers to conduct parts of a transaction without using a realtor.

Those changes were immediately shot down by Aitken because they also included a clause that makes them subject to the rules of the local boards and CREA itself, if it chooses to change its rules again.

The two sides have been engaged in a war of words since negotiations broke down in February.

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