TREB’s anti-competition hearing kicks off with some surprising numbers about real-estate commissions
After a five-year investigation, the Competition Bureau’s case against the Toronto Real Estate Board finally hit the courtroom yesterday. (TREB’s exclusive control of the Multiple Listing Service has it facing accusations of anti-competitive behaviour like denying low-cost brokerages and homeowners access to sales information.) On the first day of the hearing, John Rook, a lawyer for the bureau, gave some pretty staggering numbers:
• Apparently, agents from ReMax and Royal LePage collected 45 per cent of commissions paid by GTA homeowners (totalling about $2.2 billion for the two real estate giants).
• And, as GTA home values have risen, the agents have seen the value of their 2.5 per cent grow as well, from an average of $9,000 per property five years ago to roughly $11,500 today.
While Rook argued that today’s web-savvy buyers and sellers should be able to avoid paying that commission and access sales info themselves, TREB maintains that opening the Internet floodgates is a massive privacy problem. Whatever the tribunal rules five weeks from now, it should be precedent-setting. [Toronto Star]
4 thoughts on “TREB’s anti-competition hearing kicks off with some surprising numbers about real-estate commissions”
What the public fail to realize is that this case is not about commissions. TREB has maintained that you can charge any commission you want. It is about preserving the integrity of an MLS system that has taken decades to build. Imagine spending millions of dollars building and maintaining something only to have the gov’t step in and say ‘sorry, you have to let everyone use it’. I think you would fight with all your might to keep it.
The competition bureau wants the general public to have access to private information yet the commissioner herself, melanie aitkin, recently listed her house and disguised her name. Interesting that SHE didn’t want people to know her details.
Privacy shmivacy. The MLS system is a shambles anyway… open it up and let someone else improve it.
Oh come on Maisy, Its all about the huge commissions.
I could have a small IT group easily program that MLS internet application. If they spent millions of dollars on
that application then they did not get what they paid for.
Put that 2 billion in commissions earned in perspective.
A Canadian business with 50,000 employees and 1500 medium to large locations across Canada does not even have half that in income.
Just to put things in perspective 2.5% paid to both the listing and selling agent upon sale of a modest $400,000 property amounts to a $20,000 cash grab that IMO is nothing short of highway robbery and is instrumental in sellers raising their prices to offset the high cost of selling. Your selling agent will get $10,000 on this sale for which all he does (usually and more often than not) is list it on the MLS and wait for other agents to beat a path to his or her door. The negotiations commence, the house sells, a bit of paperwork ensues and BINGO he/she is $10,000 richer. Not a bad gig I’d say. It’s time to open up the MLS and stop the pillaging of what is often the sellers only asset in life.
Comments are closed.