A Change Is Coming To The MLS System We Know
The MLS (Multiple Listing Service) System has been in place since the late 1800s. The CREA (Canadian Real Estate Association) and the NAR (National Association of Realtors) were the original founders of the MLS System, and to this day only their members can make use of it. In fact, the MLS is a giant list of homes that is distributed from one broker to the balance of those involved with the NAR or the CREA. With their combined efforts, the home sells much faster, and those involved get paid a commission. The new age of marketing and advertising has created somewhat of a disagreement between the NAR and the CREA. There has been much discussion as to how effective the MLS System really is in the real estate market.
The internet is now a valuable resource to home sellers and property buyers. This cuts out the need for the larger publicity that the MLS System offers, as the real estate is shown to several potential buyers over the internet for little to no extra cost although many buyers browsing for Mississauga homes could still look for Mississauga MLS listings in Google. With this new resource, the MLS System has to reinvent itself to stay competitive and the NRA and the CREA have been convening to discuss possible changes. We should keep in mind that the MLS System is still very effective when it comes to finding a buyer for your property. When you put your real estate in the care of one the MLS brokers, you can be assured that your property will sell for what its true value is. The internet is allowing the property seller and buyer to become much more educated when it comes to negotiating a sale, and this is causing the real estate market to need less MLS agents.
It is general consensus amongst members from both the NRA and the CREA that the MLS should be accessible by more agents. Home sellers often have to do some leg work to find an MLS agent, and opening up the MLS to more real estate agents will cause less hassle for the seller, which will translate in more clients for the MLS realtor base. Members of the MLS System are aware that the real estate market is changing, and that they are going to have to accept smaller fees for their services. If the MLS was to become nonexistent, then the real estate agents involved would end up without a source of income.
The main issue with the MLS System is that its members request surplus fees to sellers for its services. In many situations, these services have little to do with the MLS listing. When this came out to the public, many were outraged by the NAR and the CREA demanding fees that were extra to what was needed for just the listing. This increased pressure has brought the CREA to face many critics, and now reforms seem to be unavoidable. Consumer choices within the MLS System have become the forefront of changes amongst others. Consumers will be able to choose exactly which services they want from the MLS System, which will cut costs and not allow MLS members to demand unwarranted fees.
The internet is now a valuable resource to home sellers and property buyers. This cuts out the need for the larger publicity that the MLS System offers, as the real estate is shown to several potential buyers over the internet for little to no extra cost although many buyers browsing for Mississauga homes could still look for Mississauga MLS listings in Google. With this new resource, the MLS System has to reinvent itself to stay competitive and the NRA and the CREA have been convening to discuss possible changes. We should keep in mind that the MLS System is still very effective when it comes to finding a buyer for your property. When you put your real estate in the care of one the MLS brokers, you can be assured that your property will sell for what its true value is. The internet is allowing the property seller and buyer to become much more educated when it comes to negotiating a sale, and this is causing the real estate market to need less MLS agents.
It is general consensus amongst members from both the NRA and the CREA that the MLS should be accessible by more agents. Home sellers often have to do some leg work to find an MLS agent, and opening up the MLS to more real estate agents will cause less hassle for the seller, which will translate in more clients for the MLS realtor base. Members of the MLS System are aware that the real estate market is changing, and that they are going to have to accept smaller fees for their services. If the MLS was to become nonexistent, then the real estate agents involved would end up without a source of income.
The main issue with the MLS System is that its members request surplus fees to sellers for its services. In many situations, these services have little to do with the MLS listing. When this came out to the public, many were outraged by the NAR and the CREA demanding fees that were extra to what was needed for just the listing. This increased pressure has brought the CREA to face many critics, and now reforms seem to be unavoidable. Consumer choices within the MLS System have become the forefront of changes amongst others. Consumers will be able to choose exactly which services they want from the MLS System, which will cut costs and not allow MLS members to demand unwarranted fees.
Comments (1)
I always have to laugh when I hear that consumers get to make choices about what services to obtain from a broker. But in over 22 years experience I can assure you that when push comes to shove and a seller or buyer (and by extension through necessity) a broker stands to lose a transaction or tasks have to be performed to keep a deal going, that broker is going to do whatever is necessary to make it all happen. So I wonder what do we brokers "take off the table" when sellers expect us to reduce our fees. Only the uninitiated would believe that there is anything to "take". This is, in my opinion, in-disputable. Our (brokers) contacts with people in the business such as loan officers, inspectors and a host of other service providers, are exactly the "grease" for keeping deals together and why market participants need a good broker. Interestingly, millionaires almost always use us. The reason: they are too busy making money at what they do to bother with the mundane tasks we perform daily on their behalf. Neophites then should follow that lead if they honestly believe they'll be successful at RE investing. MLS systems do sort of corner the market but at the same time it is the most accurate aglomeration of sales data out there and the brokers pay upfront for it, for you the consumer etc. If you don't believe me try figuring out sales comps on commercial real estate. If you had to do that to begin investing you'd never make a move! Despite the amount of data out there on the internet people still have to jump up off their butts and actually visit a property. A photograph or "virtual tour" or an aerial image only says so much. Consumers are always in the driver seat anyway so far as choices go in terms of pricing or purchasing and demanding a level of real service from brokers who would collect a commission on a sale. So I'd like someone out there to explain to me here what is meant by "surplus fees". I just did a transaction last week in the couse of which I had to make probably six separate vsits to the property for the seller since she was ill and could not be on site. I suppose, since I worked for a reduced commission, I should have just put my foot down and refused at some point to continue providing (essentially free until closing) services for her! But the work had to be done and I was the go-to guy. I just do not honestly know what to take off the table. Great theory...doesn't work in practice! And...I might be off topic here. If so... Sorry! End of Rant. austinbroker
Ken Criste, about 16 years ago