The commission costs of buying and selling homes in Canada may be set to drop. The federal competition bureau has wrapped up a two-year investigation of real estate practices and they are pushing for big changes. They want the Canadian Real Estate Association (CREA) to open up its Multiple Listing Service (MLS) to discount real estate brokers.
Until now CREA has kept commissions on the sale of homes in Canada at artificial levels (usually 5-6% of the house’s sale price) by refusing access to MLS to any broker offering lower commissions. Because most homes for sale are listed in MLS, being denied access is a serious impediment for discount brokers.
For now CREA is sticking to its guns saying that they don’t plan to grant greater access to MLS. This may ultimately lead to a showdown before the Competition Tribunal. It seems that we can eventually look forward to lower real estate commissions driven by market forces rather than a monopoly.