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February 17, 2022

Are full-service realtors a dying breed?

Competition Bureau Commissioner Melanie Aitken has cut the heart out of the Canadian Real Estate Association's restrictions on the use of the Multiple Listings Service, the database at the centre of Canada's housing market.

Is this the beginning of the end for CREA's 98,000 members? Will they soon be replaced by U.S.-style budget brokers, in the same way that upstart online brokers muscled their way into the financial industry a decade ago? 

I doubt it. But it's a nice idea nonetheless.

When the U.S. market went through a similar exercise, the result was a slew of sites that offered enhanced listings at sharply reduced pricing.

Despite a troubled U.S. housing market, do-it-yourself sites like Redfin and Zillow report strong sales and increases in web traffic. An average of 9 million users visited Zillow last month, for instance, an increase of 19 per cent year-over-year.

As technology and deregulation lower the barriers to entry here in Canada, upstarts like Property Guys, Homebuyandsell and even general purpose sites like Kijiji are hoping to capture a bigger piece of the listings pie.

And while new competitors don't necessarily want to cut real estate agents out of the process completely, the agent's role and the accompanying costs may have to change.

With a discounter who'll list your house for a small fee instead of a large commission, more people will certainly consider selling their houses on their own.

Realizing this, CREA has already said it would make changes to allow consumers to access cheaper services.  The changes, which members will vote on next month, would make it a bit easier for sellers to post their homes on CREA’s site without necessarily signing on for an agent’s full package of services.

The proposal fall far short of both the U.S. experience and the Competition Bureau's recommendations, however.

What do you think: Do realtors earn their keep? Would changes like this encourage you to sell your own home?

By Gordon Powers, MSN Money



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

James HaversJames Havers

James is the senior editor of MSN Money living in Toronto. He has worked for the Nikkei Shimbun (Tokyo),,, Canadian Business and other publications. Havers turned to journalism after teaching overseas.

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...