In thinking about the Realtor Cooperation Policy, I am struck by two things. The first is a lack of nuance. It feels like a blunt instrument designed primarily to increase the number of listings available to MLSs for public distribution.
The second is the mechanism by which CREA proposes to bring in this policy, which is by way of amendment to the Realtor Code. In much the same way governments are fond of naming legislation for the benefit of those that don’t read beyond the headlines, such as Ontario’s Trust in Real Estate Services Act or British Columbia’s Anti-speculation and Vacancy Tax, CREA has created an amendment named the Duty of Cooperation.
Who would oppose trust in real estate services or support speculation and vacancy? And which realtor would oppose cooperation?
Cooperation is noble, desirable, and the principle upon which we’ve built our very successful business. But is it reasonable to make cooperation an ethical act, a moral imperative? The necessary implication is that a lack of cooperation is unethical.
This goes too far. The reasons for not cooperating might, in fact, be unethical, but there are some cases where the reasons for not cooperating—in the traditional sense that we understand it to be—are ethical.
“I should be clear here; I am no apologist for exclusive listings. I believe, in most instances, that the selling public is better served by the wider market offered through our MLS systems.”
The act of cooperation is neither ethical nor unethical, but rather the reasons for it are what determines the morality of the action. The amendment to the Realtor Code bluntly makes the act of cooperation an ethical issue.
The policy (which becomes enshrined should the amendment to the Realtor Code pass) does not take into consideration those who wish to engage the services of a realtor but for whom—for reasons of privacy, notoriety, fear of reprisal or other valid reasons—there is no appetite for MLS, but at the same time may want to benefit from a realtor’s expertise in other areas of marketing and promotion.
I should be clear here; I am no apologist for exclusive listings. I believe, in most instances, that the selling public is better served by the wider market offered through our MLS systems.
However, I also believe that it is up to the consumer, to our client, to decide how we will provide services to them. In this context, if we want the realtor to be central to more transactions in the marketplace rather than less, then operating exclusively needs to be an available choice and not one that is so very limited by the proposed policy.
“I suggest a compromise solution that creates a level playing field for realtors in each market…”
What might be a more nuanced approach? One that finds common ground in the sound arguments proposed in these pages, both for and against in recent months.
I suggest a compromise solution that creates a level playing field for realtors in each market, addresses the coming soon issue, adds to the market data we collect and still offers the public the opportunity to not participate on the public side of the MLS.
We could create a new category of listings within our respective MLS systems that does not display publicly, does not feed into auto search type portals, yet still makes such listings available for the industry.
There are several types of listings that have no public side to them that realtors can still access through our systems—expired, inactive and cancelled listings, for example.
Adding one more shouldn’t be a technical challenge. We know all “coming soon” listings are exclusives, but not all exclusives are “coming soon.”
“We deserve innovative and progressive solutions to the issue we face, not blunt instruments.”
We can solve the problem of private club-type marketing for listings that are to the detriment of those left out while aggregating this type of listing for all our benefit. We capture what might be lost market data that can be incorporated into our overall statistics.
By not having these listings publicly available, those sellers who truly don’t want to be public are given that option. Realtors can access and selectively decide which of their buyers might be interested.
A separate set of rules of cooperation for this category could be developed around identified pain points, such as the ability to qualify potential buyers through their agents and removing the requirement to allow showings regardless of comfort level with the showing request.
A shallower dataset, less documentation and fewer collateral materials may also be considered. And for those sellers who absolutely don’t want anyone to know about their listing, the option of being an unpublished exclusive would remain, as the trigger for putting the exclusive listing into this new category could be similar to what is described in the current Realtor Cooperation Policy.
This is an unrefined idea, but I do believe within it are the seeds of compromise. I believe such an approach would expand the reach and value of our MLS systems. This is what we should be seeking to accomplish.
We deserve innovative and progressive solutions to the issue we face, not blunt instruments. We already have the real ethical duty of acting in our clients’ best interests; we don’t need a made-up duty of cooperation in order to serve our clients at the highest ethical level.
David Langlois has been an award-winning Realtor since 2003 and is currently the Managing Broker for Macdonald Real Estate in Victoria, BC. David has been involved in organized real estate for many years and was the President of the Victoria Real Estate Board in 2021. His goal has been to contribute to strategic initiatives in the province and has focused on government relations and real estate industry policy with a focus on increasing professionalism and keeping Realtors at the centre of the real estate transaction.
Well stated.
It seems though our elect craft strategic plans that propose to do one thing, while they take the rest of us along for a merry ride as they do another.
This from TRREB’s just released 3 year strategic plan – the very first statements made as to those plans.
Apparently the delegation that will be casting their vote today for the exact opposite of this has been so instructed by leaders who haven’t even read what they wrote.
Pledge of Competition:
“A brokerage may offer any variety of services, e.g, exclusive…”
Advertising by members and non-members is subject to the discretion of the individual, as long as it is honest and lawful. We encourage creative, competitive choice in the services advertised to the public.
The business relationships between broker members, their salespersons and non-members is theirs to determine.”
Great piece, David. There are several issues with this policy, which (if enacted) will leave some sellers very frustrated. Your idea of just another category in our mls system, one for listings that are not public but only accessible by registrants, is one that I think should be pursued further. Yes, 99% of sellers would do much better on the open mls system (something I don’t think any realtor would disagree with,) but we need to have a better option for the small number of very specific scenarios for which that just won’t work. I don’t know about you, but to me this policy seems kind of rushed and very …forced. …it doesn’t smell very “free market” to me.
I agree this being pushed through quickly. With listing volume down there is a need to ensure co-operation to try and make sure there are 2 Realtors involved in every deal. As with everything else Realtors will now waste their valuable time trying to figure out another strategy to deal with this. If directed by a Seller are we now to say no to their lawful request. I think not.
Good solution
Conflation (perhaps unintentionally) on the road to barring the “Coming Soon” practice utilized on some Not-MLS listings from the Residential field of Organized Real Estate.
There are Two Types of Listing a) OPEN (not signed by Seller) and b) EXCLUSIVE (commission/agency contract signed by seller).
Further, within Exclusives there are also two categories :c) Not-MLS and d) MLS.
Cooperation sort-of, might-be, thought-to mean “allowing showings through an outside Brokerage”, but it actually means “sharing the commission” and on MLS listings “co-operation” is automatic.
On MLS a co-op fee is offered in writing on the MLS Contract and on the info sheet.
On Not-MLS signed Listings (ie Exclusives) a showing by an outside brokerage commission to an outside brokerage is NOT automatic – it must be requested by the outside brokerage and may or may not be granted by the LBO.
On MLS listings the Total commission is confidential between the Seller & the LBO.
Similarly, on Not-MLS listings the Total commission is confidential between the Seller & the LBO PLUS the amount of any potential co-op fee is unknown and unknowable by an outside Brokerage.
BUT (at least in Ontario) registrauhnts are bound to show any and all listings without a thought or concern about getting paid.
So if a Client/Customer/Looker/Buyer (CCLB) of a registrauht sees a “Coming Soon” sign and wants to see the property … if dredges up all these unconnected components — without a Standard Operating Procedure (SOP) on how-to handle the situation. The SOP is not-available for either LBOs or outside Brokerages.
And in several recent hot market (shortage of supply relative to demand) the “Coming Soon” listing strategy became contentious.
Similarly the “List-Low & Hold Offers until a Future Bidding Date has no Standard Operating Procedure (SOP) for neither LBOs or for outside Brokerages.
Hence the trouble that resulted in the CREA policy under discussion.
Too bad they couldn’t have built a Standard Operating Policy (SOP) for both “Coming Soon” as well as for “List-Low & Hold Offers until a Future Bidding Date”
List low – and hold offers works for some and doesn’t for others. As an agent my job is to present all offers when received and allow my client to make a response. I have practiced a first come first served attitude for 35 years and continue to do so. I await the first demand for commission from a selling broker served on a listing broker and his client for failure to accept a firm, full priced offer with deposit and closing date matching that requested ( in the mls posted listing )
The system says we get paid for bringing about a contract that matches those requirements – when the agent holds back or the client plays games we will find the contract doesn’t say oh the commission is only payable if I decide to sell my property no matter what the offers are –
I think that this will be deemed illegal when challenged in the courts. Firstly, it restricts homeowner/consumer choice/freedom; and secondly it restricts competition to the “FSBO marketing agencies”.
Thank you Robert, well said, particularly regarding the subtle nuance of ethical and unethical behaviour surrounding cooperation. Given the fundamental and far reaching nature of this amendment, it should really have been placed in front of members and not just delegates for a vote.