Can I List My House On The Multiple Listing Service Without A Real Estate Agent?
July 1, 2010 – 7:28 am
Many sellers of Canadian real estate wonder, “Can I list my house on the Multiple Listing Service without a real estate agent?” In the past, listings on the MLS were the exclusive domain of full-service real estate brokers who charged 6% commission on the sale of a home. During the spring of 2010, the Canadian Real Estate Association (CREA) relaxed its strict regulation of the behemoth MLS, opening the network to increased competition.
Sellers still need a broker to complete their listings on MLS, but they now may pay the agent a flat fee just for that service. Listing on the MLS adds sellers’ listings to major brokers’ websites and to Realtor.com, giving properties global exposure. Real estate brokers still own and control the Canadian Multiple Listing Service, but far more sellers now may gain access to the industry’s oldest, most reliable, and far-reaching listing of properties for sale.
In the wake of complaints to the Competition Bureau that MLS rules restricted competition and violated anti-trust laws, the Canadian Real Estate Association relaxed the rules for listing properties on the Multiple Listing Service. Although FSBO users still must engage a broker to list their properties, the rules no longer stipulate that only a licensed broker may photograph, describe, list, or show the houses listed on the giant exchange. Many of the complaints had originated with brokers themselves, who argued that strict MLS guidelines interfered with their ability to offer clients a la carte services.
The most comprehensive listing of homes for sale in North America, the Multiple Listing Service has stood as one of the cornerstones of the real estate profession for well over five decades, evolving from a sophisticated newsletter to a high-powered and extremely sophisticated internet operation. For many realtors, access to the Multiple Listing Service stood-out as by far the greatest asset and advantage they had to offer prospective clients. In recent years, however, the growth of For Sale By Owner (FSBO) websites coupled with rapid expansion of Google, Yahoo and Craig’s List have diminished MLS’s power over and control of real estate listings.
An endangered species?
Many Canadian brokers have re-examined the history of the MLS in New York City, where it dominated sales and competition in the boroughs but never even got a foothold in Manhattan. They concluded, correctly in most experts’ view, the bigger and more competitive the market, the less effect the MLS had. Although they generally have maintained some presence on the MLS, the majority of high-powered brokers in over-heated markets have put their emphasis on and resources into developing their own internet marketing tools. In many brokers’ estimates, the MLS still is just a glorified brochure; and they complain that it has failed to keep pace with technology. Cutting-edge brokers are capitalizing on the web’s inter-active capabilities, building personal relationships with prospective clients before they even set foot in their offices. One broker summed-up, “MLS either moves into the twenty-first century or it goes the way of the dinosaur. The next six months will seal its fate.”
Other market forces at work.
Real estate analysts suggest that brokers would have relaxed their stranglehold on the MLS in the near future even without the Competition Board’s action, because buyers and sellers have access to more tools than ever before. Buyers and sellers also have higher costs than ever before, because HST, Land Transfer Taxes, attorneys’ fees, and other closing costs have increased even as sales prices have remained relatively constant. Moreover, better-informed buyers and sellers have learned that everything about a real estate transaction is negotiable, and they have learned to use their leverage with agents struggling in the throes of a slow market.
HST alone has had a chilling effect on demand for agents’ services in Ontario and British Columbia, where properties practically sell themselves and real estate attorneys easily manage all the details of even the most complex transactions. The HST burden falls on buyers who pay the extra 12% or 13% on a new-home purchase just as they would on the acquisition of any other taxable good or service. HST does not, however, apply to new homes valued under $400,000(CAD). Although buyers of resale homes and the majority of new condominiums will pay no HST on their new properties, they will pay HST on realtors’ commissions, appraisers’ fees, and professional moving services. Experienced real estate buyers, already skeptical about the real value of a buyer’s agent, now have even more incentive to go it alone. Access to the Multiple Listing Service does not provide much incentive to pay thousands of extra dollars for the purchase of a new home.
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