The Federal Court of Appeal ruled against Canada’s largest real estate board today and denied their recent appeal. Canadian consumers can now expect more access to homes sales data, including how much a home sold for, how much an agent earned on the sale, among other real estate transaction data.
Today’s ruling was the latest in a multi-year battle between the Competition Bureau and the Toronto Real Estate Board (TREB). In August 2017, TREB filed an appeal after a three-judge Competition Board tribunal panel ruled against the TREB in April 2017. The tribunal argued that TREB’s rules regarding the public disclosure of property and sales data restricted the ability of realtors and virtual office websites to introduce innovative services and this, in effect, denied consumers the benefits of greater competition. In an earlier statement, the Competition Bureau commissioner stated that “by denying agents the ability to introduce new and innovative real estate brokerage services using the internet, consumers are ultimately denied the benefits of greater competition. More competition generally means lower prices, better product quality, greater consumer choice and innovation, all of which benefit not only individual Canadians but the economy as a whole.”
TREB’s appeal in August argued that publishing sensitive data, such as the sold price of a home, would end up violating a consumer’s right to privacy.
Do sellers want this information out in the public sphere?
“Any public information that is easily accessible by consumers to help with their buying and selling decisions is good,” explains Mustafa Abbasi, president of Zolo.ca, a national independent brokerage and a tech-disrupter in the Canadian real estate marketplace. “However we are not convinced that consumers want sold data publicly displayed due to privacy reasons.”
About a decade ago, certain tech-savvy realtors began to use sold data to advertise their services to potential buyers and sellers within targeted neighbourhoods. “A postcard or e-newsletter that showed the recent sale price of a home in the neighbourhood was a great way to flag sale trends and motivate would-be buyers and sellers,” explains Abbasi. But agents weren’t allowed to use the sale information unless they first received written authorization from the seller. “Marketing sold data required a signature and not everyone was eager to have this information disclosed,” explains Abbasi.
Now, Abassi wonders if the latest ruling from the Federal Court of Appeal will offer sellers an opportunity to decide whether they want certain information kept private or released to the public.
Why TREB didn’t have a chance
In an earlier interview with BNN, real estate lawyer Bob Aaron stated, “Reading the tribunal decision, I don’t think TREB has a chance of winning [the appeal].” He added that the board’s argument—to protect privacy—is a red herring. “Every deed and transfer of land in Ontario is registered in a system where lawyers and others have access. Anyone can pay a nominal fee to get into this system and find out how much a person paid for their house.” The real issue, says Aaron, is the “method of distribution, not the privacy of information.”
How should consumers use this newly available information?
Over the years, analysts argued that the real reason TREB fought so long and hard to deny accessibility is that more public access to data could erode an agent’s value-add in a real estate transaction.
As a veteran Realtor, who is very familiar with the impact better access to data had on the U.S. real estate market, Abbasi doesn’t agree.
“Better access to data doesn’t eliminate the need for a real estate agent,” he says. “Just because a buyer or seller can do all their own research and get all their own data doesn’t eliminate their need for guidance. Interpretation of the data, knowledgeable advice and the ability to bring expertise to every transaction are all ways full-service Realtors can still add value.”
As Aaron pointed out: “There will always be a market for the high-end real estate agent that charges full commission and for the discount brokerage or do-it-yourselfer.”
What should consumers expect?
In the days, weeks and months to come, expect to see this newly accessible data on Realtor websites and in broker newsletters. You can also expect some exciting offerings from the more tech-savvy brokerages, such as Lauren Haw’s Zoocasa, Fraser Beach’s Select/Plan Real Estate, John Pasalis’ Realosophy and Ryley Best’s Zolo. For years, many of these real estate tech-disrupters have pushed to make data more accessible to the public. This new ruling will now give them the authority to provide more contextual information to their clients and to the general public.
Click here for full access to the full Federal Court of Appeal ruling.