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MLS and the Competition Bureau

The process of selling in Canada is effectively controlled by Multiple Listing Service. Over 80% of sales transactions take place though this medium. The CREA, Canadian Real Estate Association, owns the MLS® trademark, has proprietary ownership of the REALTOR trademark. CREA sets up the rules for using their trade mark and only the members of Canadian Real Estate Association, primarily Real Estate Sales persons, brokers and other professional affiliates can use the trade mark. Under MLS, the members of the service, share the information among each other to expedite the process of selling. The access to the important data is not open to the public.

The process of selling a property through the services of MLS can be divided in 5 different stages.

Processing a MLS Listing:

This includes things like, collecting the pertinent information about the property, such as measurements, legal description, zoning, liens if any, Title, Insurance, property taxes and converting this to the format that the board accepts and then processing it through the MLS system. The important information about the property is then made available to the consumers by CREA’s on its website however, it does not carry the names of the owner, his contact information or any thing that would help the consumer to contact the seller directly. He must contact the broker representing the seller to get more information and to see the property.

Marketing the property:

This includes all those steps the broker takes to expose the property to the prospective buyers to bring in the sale. This includes, but is not limited to, activities like, advertising, in papers, sign on the property, holding open houses, face to face meetings with prospective buyers, sending flyers, advertising on the net, canvassing, etc. etc.

Servicing the Listing:

Encompasses answering questions and queries of consumers, brokers, lawyers, mortgage broker, building inspectors, appraisers, providing answering desk, making appointment and keeping a log of the activities to facilitate the sale and seeing it through the closing.

Representation and Negotiations:

This is the most important phase for the sale of the property. This is where the knowledge, expertise and experience of the agent shines and can have a huge impact on the final outcome. It includes representing the Seller in negotiations with the buyer / buyer’s agent. The goal here is to promote and protect the interests’ of the seller and maximize his returns from the sale of the property.


During any of the stages stated here above, there may be situation where the seller needs the advice concerning any issue effecting the sale of the property.

So if one wants to use the services of MLS, he has to contact a member of the CREA and hire him to process the listing of their house/property through CREA’s MLS system. The standard agreement does not allow, except few basic amendments, any changes to the listing agreement. CREA’s approach is take the MLS agreement as it is or leave it, no exceptions.

Under the current MLS rules and regulations, the consumer must keep the services of the broker through all stages of selling and the broker must stay involved. There is no provision for the consumer to hire the broker just for posting the property on MLS, servicing the listing, marketing or have the broker represent him in negotiations. Currently it is all or none for the consumer.

This is where the government feels that CREA has a monopoly. Government wants that the consumer should be able to hire only those services that the consumer needs rather than being forced to take the full bundle. Government wants to see more competition for the benefit of the consumer. Competition should help to bring the cost of selling down for the consumer as he will be able to choose only the services that he needs.

In the long run, it should be a win-win scenario for the consumer and the people in the real estate brokerage industry. Brokers will get more freedom and will be able to custom tailor the services according to the needs of the consumer. It will bring down the selling costs for the consumer and will also lower the costs of doing business for the brokerages. Currently to comply with CREA’s rules and regulations, brokerages must have the infrastructure to see the sale through all the stages of the selling process. The restrictions imposed by MLS are unproductive and ultimately the consumer pays.

Only time will tell who will benefit more, the consumer or the brokerages.

May 23, 2010 in Competition Bureau / CREA | Permalink


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Posted by: Real Estate | Jul 26, 2010 9:54:51 AM

How much % will go to the seller of a property if he/she is able to have a deal that is worth $50k-100k property?

Posted by: Appartement Louer | Jul 25, 2010 9:40:38 AM

Has anyone done a short sale in Real estate? Let me know what the lenders are looking for. Anyway thanks for this great post.

Posted by: House Property For Sale | Jul 23, 2010 2:16:03 AM

Competition Bureau need to open MLS up. Only the realtors with a vested interest does not want it opened up. A open and free MLS would mean very little fees. I hear $100 to list your home on MLS when it's open to the free market.

Posted by: Frank | Jun 21, 2010 11:33:10 PM

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