By Nan Campion

Part 1 of 3 Series: The Competition Bureau has stated that sellers should be allowed to list their property on the Multiple Listing Service without accepting and paying for all of the services that a real estate agent can offer. It has even been suggested by the Bureau that one possibility would be for the seller to pay a flat fee to list their home on MLS and not involve an agent any further in their process. Buyer’s and Buyer’s Agents could then contact the seller directly and negotiate their own deal. On paper this sounds like a great idea doesn’t it? The belief is that the seller would pay far less in fees and he or she would be free to handle their transaction themselves. I have no reason to doubt that the Competition Bureau means well in suggesting this reduction in services and fees. It sounds logical, however, if this suggestion is accepted I believe we will be putting the quality and ethics of real estate transactions in Canada back decades.

Perhaps people have forgotten what it used to be like. When I first entered the business in about 1980 the common adage was “buyer beware”.  In those days agents had a contract with the seller only and owed a fiduciary duty only to that party. The buyer was at the mercy of both the seller and the agent. The seller knew their property well, both the good and the bad and might or might not choose to share all of the relevant information with the buyer. The agent had no responsibility to inform the buyer of anything that might affect the enjoyment of owning this property, nor their eventual return on investment. There was no requirement to tell a buyer that a commercial property was planned to be built behind the house they were considering or that there was a crack house next door. The buyer had no protection. Over the years the real estate associations have worked tirelessly to improve the business and to ensure that both parties are fairly represented. The Real Estate Associations decided that although representing only the seller was legal, and no lawyers that I am aware of ever suggested that this wasn’t a good practice, the real estate association decided that it was not a fair practice so a few years ago they introduced the Buyer Agent. Now both parties were on equal footing as both the buyer and seller had a qualified agent representing their interests.

With implementation of the suggestion by the Competition Bureau that sellers could be allowed to represent themselves while on MLS, we would not only be back to “buyer beware” but on top of that we would have “seller beware”.  Here are 3 primary reasons for concern:

  1. If the seller pays a flat fee and decides not to include an agent in any other part of the process, there would be no one to disclose to the buyer any defects of the property or the area. The Buyer’s Agent would of course have that responsibility if they knew anything but without an agent on the other side there is no one to know and disclose these details to the buyer’s agent. – Once again “Buyer Beware”.
  2. Many buyers, when first thinking of the possibility of buying a home, start by searching on MLS.ca before they are ready to hire an agent. If they stumble across a listing “by owner” aren’t we back to “Buyer Beware” again? First time buyers especially, often have no idea of what they should look for, what questions to ask or even what makes a good location and therefore a good investment. I suppose we could take the attitude that this is the buyer’s problem and not that of the seller but do we really want that type of imbalance back into what is for most of us the largest transaction of our lives? I don’t think so.
  3. Most sellers who want to pay a flat fee and have no other involvement from an agent are those who are quite confident that they are good negotiators  – whether they actually are or not. Perhaps they have had experience buying and selling homes with a realtor or on their own previously and feel quite sure that they can handle it themselves. If they have even bought and sold 5 homes in their lives, their experience in real estate negotiations  is very limited compared to the agent who has had years of experience in tough negotiations in all types of markets. If the buyer who has an experienced agent working for them approaches the seller then who is at a disadvantage? Aren’t we now at “Seller Beware”?

A good agent negotiating for a client either buyer or seller has the experience that can make a major difference financially to the client.
The Competition Bureau thinks that in giving people more choice they are improving the situation for sellers.  Are they really? I think this arrangement would put buyers and seller back on unequal footing and put us back in a Wild West mentality – the survival of the fittest.  Shouldn’t we be beyond that in 2010?

Nan campion is a Broker with Royal LePage/Johnston & Daniel Division.  Nan is a regular contributor to the Muddy York Real Estate Blog.



  1. patrickfindire

    Great Post! I find your blog very helpful for real estate and I am sure others do as well. Keep up the good work!
    Condo listings

  2. Excellent article Nan! It’s good to see thoughtful articles from a realtor POV. I agree throwing the whole thing open is not in the public’s best interest. I feel though that you have left yourself somewhat vulnerable to people who may vehemently disagree that wholesale changes to the way the MLS works is a step backward.

    I don’t think it’s a good idea to refer to conditions in the eighties without addressing the impact of the internet. As realtors we have to accept that with the internet many consumers are much more knowledgeable and better equipped to carry out a transaction than they would have been in the ’80s and ’90s. That’s not to say that they will do a good job, but they do perceive themselves as having the ability. I think as realtors we need to acknowledge that fact and be willing to work with the changing mindset.

    I think as realtors we also need to address the fact that there are plenty of realtors out there who don’t provide good service and at times, questionable service. As an industry we have failed to address this issue. It’s one of the primary complaints from the public, yet there is no dialogue from brokerages, local Boards or CREA addressing the public’s concerns. We do have a Code of Ethics, but there has been a failure to protect the public. Maybe CREA or the local boards need to hold public meetings.

    Just my thoughts … maybe you were going to address these very things in Part 2 and 3.


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