Montreal Real Estate Board says Buh-bye to Cdn Real Estate Association

The Greater Montreal Real Estate Board, Canada's second largest,  has served notice that it will withdraw from the Canadian Real Estate Association at the end of 2013. Quebec members pay about $3.4 million in CREA dues annually.

The GMREB represents 10,000 or so brokers, roughly a tenth of all CREA's membership.  The national organization represents boards across Canada. The two have been at odds for years, with Montreal complaining about CREA's weak defense of Quebeckers' interests, spending, dues increases and the services members receive in return.

The big item is CREA's unwillingness or inability to block "for sale by owner" (FSBO) properties from the realtor.ca system in Quebec. These listings are legal in other jurisdictions but not in Quebec, where only brokers licensed through the provincial licensing agency, the OACIQ, are allowed to market and sell properties on behalf of a third party. This makes Quebec different from the rest of Canada.

Quebec's 12 boards were worried enough about the possibility of FSBOs being listed on the realtor.ca that they launched their own property-search website, centris.ca. It has asked CREA to default to  Centris rather than Realtor for all Quebec property searches. So far, no response.

In a letter to members, the GMREB included links to two Montreal area FSBO listings recently posted to realtor.ca through a Toronto listing service affiliated with the Toronto Real Estate Board. That back door move bypasses Quebec's licensing and professional oversight requirements.

You can see how there would be irritation and hurt feelings, right?

But FSBOs aren't the only irritant. Montreal is also reluctant to take part in a national data distribution system that would put information collected by GMREB members into the hands of cut-rate sales firms and FSBOs. Data like average selling prices, days on the market, etc is gold to real estate professionals and, presumably to those who would feast on our labour. We've paid to have it collated by our association. We aren't about to give it away to the Du Proprios of the world.

There are other issues, as well. CREA wants to create a national code of ethics for real estate professionals. GMREB opposes the idea because its primary role is to protect and promote its membership.  Quebec brokers are bound by a code of ethics administered by the OACIQ. The OACIQ fields complaints from the public, investigates, adjudicates and punishes brokers who break the rules. Best of all, every broker pays dues to maintain the agency even though we get no benefit from it. Needless to say, GMREB has no interest in  paying for the implementation of a second code of ethics.

Finally, GMREB has been asking questions about where the CREA dues end up. Remember, this is Quebec, where we know a thing or two about expense-account padding, lavish dinners, cocktail parties, exotic meeting locales etc etc. Quebec's federation of real estate boards complained about lavish spending and duplication of services. For its part. GMREB managed to claw back $1.5 million in CREA dues in the last two years and has used the money to promote centris.ca and for other advertising tailored to the Quebec market.

Talks have been ongoing, but now the time of talking seems to be over. CREA is having a special general meeting later this month in Vancouver. According to the Montreal board, despite promises to the contrary, none of Quebec's concerns are addresses on the meeting's agenda.

Unless something changes between now and then, Quebec will cut itself loose from CREA's mothership. Says GMREB president Patrick Juanèda:

 Your Board of Directors has evaluated the situation carefully and considers that, at this time, the risks and disadvantages outweigh the benefits of our membership in CREA. It is important to note that the code of ethics and data distribution rules are already in place. If we stay in CREA, we must ensure that we implement the necessary structures and have all of our members comply with them.

The board reserves the right to change its mind, especially if CREA responds to its concerns at the upcoming general meeting. Stay tuned.

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While we're on the topic of people being annoyed by the way in which their dues are spent, there's a petition going around that takes issue with the way the OACIQ is spending brokers' money.

The straw that broke the camel's back is a recently announced mandatory course for all real estate brokers on the importance of "collaboration". Collaboration is what happens when one broker calls another broker  to see a property. If you show it, you are collaborating. If you ignore the call or multiple calls, you  are not collaborating. Pretty simple. The OACIQ is requiring all license holders to take take this 2-hour on-line course at a cost of $150 each.

$150 each and they don't even have to rent a room, put on a pot of coffee or lay out a tray of danish. That's an easy $2.6 million for the licensing agency. That's on top of the $16.3 million it collected in annual dues from saps like me in 2012.

People see this training as little more than a cash grab. They are concerned that if the OACIQ gets away with this it will implement more and more "imporatant"  mandatory training at extra cost to the dues payers. It's the Quebec way, right? Can't balance your budget? Raise fees! Implement surcharges! Create a new tax!  Easy money, right? The English version of the petition has 450+ signatures. The French version, nearly 2,900.

Here's the petition.

Smart Guy Sticks a Pin in Talk of Housing Bubble

Gazette business columnist Jay Bryan ushered out 2010 with an excellent column that explains in clear, simple terms why all the hysterical talk about the bursting of the Canadian housing bubble is so much nonsense.
He's right, of course. The Globe and Mail regularly ran stories in the Report of Business about the imminent collapse of the housing market here. Any day now. Any... day... now. . .   I guess it made a nice change from those stories about whether there was going to be a snap federal election zzzzzzzz. Sorry, the thought of an election is so boring, I must have dozed off.
I ran into several buyers in 2010 who were poised to invest in real estate because they were certain that the market was about to collapse and they would be able to swoop in and buy up distressed properties at deep discounts. With clients like that, I listen politely and then gently disagree. Prices are rising, not by leaps and bounds but they are rising. Anybody who thinks they are going to get a great deal and pay less than they did a year ago, or even two years ago, is mistaken.
Here's the column, which I can't help but notice is being widely reposted in the blogosphere. Skeptical bloggers are taking aim at Jay Bryan and accusing him of drinking Canadian Real Estate Association Kool-Aid.
I think we should let those bloggers get back to stocking up their bomb shelters.

Agreement with the Competition Bureau Ratified by CREA

Members of the Canadian Real Estate Association have aceepted the agreement negotiated by CREA and the federal Competition Bureau with regards to access to the Multiple Listing Service.
I haven't seen the whole agreement yet but the Greater Montreal Real Estate Board has just issued a press release highlighting what it considers the main points.

As the GMREB has already indicated, this agreement will not have a significant impact on the way that real estate brokerage is practiced in Québec, for the following reasons: 

·         It does not give the public direct access to the MLS ^® system or to the centris.ca ^™ and realtor.ca websites; the MLS ^® system remains a service that is reserved for members of a real estate board;

·         It does not require real estate brokerage agencies to change their business models;

·         It  does not change the fact that the listing broker is responsible for the accuracy of the information contained in a real estate listing and in the MLS ^® system ; your obligation to comply with the Québec Real Estate Brokerage Act remains unchanged;

·         It does not preclude the Boards or CREA from having rules for the efficient operation of an MLS ^® system, provided that these rules are not contrary to the agreement;

·         It does not impact compensation.

The fundamental point is that CREA and real estate boards/associations cannot prevent or discriminate against "mere postings" or against real estate broker members who offer mere postings. 

The GMREB has never restricted this type of business model and has never discriminated against others in this regard. We can assure you, however, that the GMREB will continue to make every effort to ensure the accuracy of information published in the MLS ^® system so that consumers are well served and the professional image of real estate brokers is enhanced. The quality of the information found in the MLS ^® system is what sets us apart from "for sale by owner" websites. 

Finally, the agreement stipulates that seller contact information is limited to the member-to-member portion of an MLS ^® system and recognizes seller contact information will not be published on centris.ca ^™ and realtor.ca. 

As a real estate broker, you are still responsible for providing advice to your clients, and you still have the obligation to share compensation with the selling broker as well as inform sellers that they need to pay compensation to selling brokers. 

This agreement reached with the Competition Bureau concludes the litigation between CREA and the Competition Bureau, and ensures that the Bureau waives further legal action against CREA for "anti-competitive practices". The agreement will be in force for 10 years.

Here's what jumps out at me. The GMREB is making a point about the role and responsibility of agents in the real estate transaction. It looks like vendors will be able to post their properties on MLS, but they will still have to go through an agent to do it.
Some agents may choose to offer this service at a discounted rate but A) they still won't be paid until after the deal is concluded. No cash up front. B) Agents will still be responsible for the accuracy of the information on the MLS listing. Agents will still have to provide accurate tax and evaluation information, cadastral numbers and other pertinent listing details.
 In conclusion, the board reminds its agents that they/we are bound by the terms of the Brokerage Act, Quebec legislation ratified by the National Assembly. The act says that agents have an obligation to honestly and faithfully represent the interests of their clients. That obligation means that I can't just list your property and then leave the rest to you, the client. I can't waive my responsibility to you, even if all I've agreed to do is let you list your house under my name.

UPDATE

I'm not feeling the love. Here's a pithy comment from some disgruntled - is there any other kind? - Internet commentator on the Globe and Mail's site.

Realturds have replaced lawyers as the least respected vocation, for very good reasons. The sooner this group of clowns go the way of the dodo bird, the better.

Fair's Fair, Except When It Ain't

The Financial Post had a recent story speculating on what kind of deal the Competition Bureau and the Canadian Real Estate Association have worked out regarding access to the Multiple Listing Service (MLS).
Not much, according the lawyer type guy who led the charge to force CREA to open access to the MLS to consumers.
Again, I have no idea. CREA's membership, in the form of the big brokerage firms, will vote on October 24, during a regularly scheduled meeting in St. John's, Nfld.. I'll wait until the dust settles before commenting further on that.
Here's what caught my eye in the Financial Post story. Look who's making a fuss about the danger of opening the MLS up to civilians.

The other major ramification of the agreement could be a gradually squeezing of for-sale-by-owner (FSBO) sites, which could find themselves competing more and more as discount models on the MLS. That was one of the fears of National FSBO Network, whose vice-president of operations, Stephen Skelly, had argued in a letter to the Competition Tribunal that if agents list property on the MLS for a one-time fee and provide no additional service, his members would not be able to compete.

So, the guys who offer bare-bones, some might say nonexistent support to homeowners who want to sell their properties themselves,  are now worried that opening the MLS to homeowners could put them out of business. My heart bleeds. 

Montreal Outperforms Canada in February

There was a glimmer of good news in the Canadian Real Estate Association's February national resale numbers, just out. While CREA reports that housing resales were down 31 per cent in February compared to the same month a year earlier, resales were up 8.6 per cent compared to January.
It's tough to make month to month comparisons. January isn't February, after all. Still, CREA chooses to ac-cen-tu-ate the positive. It was the first month over month increase since September and comes after a 3-per-cent decrease in January.We'll take it.
In Montreal, CREA reports a 2.2 per cent increase in single-family home prices, about the same as what the Greater Montreal Real Estate Board reported a little earlier. The two real-estate bodies define the Montreal metropolitan area differently, which tends to result in slightly different statistics.
The national average sale price was $281,792 in February, down from $310,379 a year earlier. In Quebec, the average sale price was $207.927 versus $204,661. CREA did not offer a Montreal breakdown.
Agents on the ground are noticing a steady stream of first-time buyers, drawn in by rock-bottom mortgage rates. At my open house on Sunday (an NDG duplex) there were plenty of young couples, but also a fair smattering of retirees. Plenty of tire kicking and price comparing. Looks like people are taking their time and weighing their options.