Showing posts with label CREA Competition Bureau. Show all posts
Showing posts with label CREA Competition Bureau. Show all posts

Friday, March 04, 2011

CREA is now bullish on 2011 resale real estate market

This is the latest press release from CREA and indicates that they are
becoming bullish on the Canadian real estate market for the upcoming year!
I hope this finds you Happy and Healthy!

All the Best!


A. Mark Argentino
P. Eng. Broker
Specializing in Residential & Investment Real Estate
RE/MAX Realty Specialists Inc.
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CREA Boosts Annual Resale Housing Forecast

OTTAWA - February 8, 2011 - The Canadian Real Estate Association (CREA) has

revised its 2011 forecast for home sales activity via the Multiple Listing
Service(r) (MLS(r))

Systems of Canadian real estate Boards and Associations, and extended it to

Sales in the second half of 2010 rebounded faster than CREA had previously

"The hand-off going into 2011, together with the highs and lows for sales
activity posted

in 2010, provided guidance for CREA's revised forecast," said Gregory Klump,

Chief Economist.

"Home buyers recognize that low mortgage interest rates represent a once in
a lifetime

opportunity. At the same time, they expect that rates will rise, so they're
doing their

homework in order to understand what it could mean in terms of higher

payments down the road before they make an offer," said Georges Pahud, CREA

President. "The housing market and buyer psychology is different now than it
was at the

beginning of last year, so buyers and sellers would do well to consult their

to understand local market trends."

The upward revision to CREA's forecast for 2011 reflects recent improvements
in the

consensus economic outlook and a further expected improvement in consumer

confidence. National sales activity is now expected to reach 439,900 units
in 2011,

representing an annual decline of 1.6 per cent. In 2012, CREA forecasts that

sales activity will rebound by three per cent to 453,300 units, which is
roughly on par

with the ten year average.

"Recent additional changes to mortgage regulations will further ensure that
buyers don't

buy more home than they can afford when interest rates inevitably rise,"
said Klump.

"The announcement of the new changes to mortgage regulations will likely
bring forward

some sales into the first quarter that would have otherwise occurred later
in the year,

particularly in some of Canada's more expensive housing markets. This is
expected to

produce a milder version of the volatility in sales activity that we saw
last year which

resulted from additional transitory factors."

Three transitory factors contributed to volatility in sales activity last
year: changes in

mortgage regulations announced last February, the early withdrawal by the
Bank of

Canada of its conditional commitment to keep interest rates on hold until
the second half

of 2010, and the introduction of the HST in BC and Ontario during the summer
of 2010.

CREA expects that home sales activity will gain traction after dipping in
the second

quarter as the economic recovery and job growth continue, incomes grow, and

consumer confidence further improves. "Even though mortgage interest rates

expected to rise later this year, they will still be within short reach of
current levels and

remain supportive for housing market activity. Strengthening economic
fundamentals will

keep the housing market in balance, which will keep home prices stable,"
said Klump.

Page 2

The national average home price is forecast to rise 1.3 per cent in 2011 and
2012, to

$343,300 and $347,900 respectively. Average price is expected to rise
modestly in most

provinces, reflecting the continuation of a healthy balance between supply
of, and

demand for, homes listed for sale. Although the supply of new listings is
expected to

trend higher, the expected continuation of sellers' market conditions in
Manitoba is

forecast to result in a bigger percentage increase in average price in 2011
and 2012

compared to other provinces.

Tuesday, March 23, 2010

CREA announces new rules to appease the Competition Bureau March 22 2010

In a nutshell, these are the changes announced by CREA regarding the MLS system and how they came about:

* the competition bureau thinks that CREA is restricting trade in real estate in Canada by not allowing private sellers or flat fee real estate brokers to upload listings on their mls (multiple listing service) system

* to answer and address this issue, CREA announced March 22, 2010 that flat fee real estate companies may list their properties on the mls.

CREA feels that this essentially allows sellers to list their homes for a small fee through a registered real estate broker on the mls and have the seller's name appear on the listing so other brokers and buyers may contact the owner directly for showings and negotiating the offer

* CREA thinks that the changes make it possible for homeowners to pay a one-time fee to list a property on the MLS -- which would ensure maximum exposure -- and have prospective buyers contact them directly by phone.

* The Competition bureau does not think this announcement opens the mls system, and they believe it actually goes in the wrong direction

Who is right?

I feel that the announcement will allow more open access to the mls system.

I don't think it will change the mls system and the way we do business overnight, but this is just another option that sellers have when it comes to selling their home. The vast majority will continue to sell their homes through agents through the mls.

There will always be sellers who want to sell privately and allowing a flat fee access to the mls facilitates these private sellers access to the mls system.

Most feel that there will continue to be the need for the middlemen between home buyers and home sellers: you will still need a place to advertise your property, a place to compile market information, and you may even want some well-compensated expert guidance.

This will continue to be a very high profile issue with no simple or easy final answer on the horizon.

Other thoughts and issues are as follows:

* the competition bureau does not think this is satisfactory because it still allows for limitations and not a completely 100% open mls system

CREA owns the Multiple Listing Service, which includes the public websites and

The menu of services offered by real estate brokers may even grow, but some prices will fall and customers will be able to choose what level of service they want.

CREA is an industry group that represents more than 98,000 real estate agents across the country.

* extreme discount brokers that offer low or nearly non existent services to clients to list properties on the mls

There are many issues regarding opening up the mls system to flat fee brokers and sellers who want little or no representation in a real estate transaction

* The Canadian Real Estate Association approved changes Monday that will give those who buy or sell their homes on its listing service more power to handle portions of the transaction on their own, but it was not enough to satisfy the Competition Commissioner.

* In a move to cut off a challenge by the Competition Bureau, which feels the current system is too restrictive because anyone listing on the Multiple Listing Service must employ an agent through the entire process, the association's members voted at its annual general meeting in Ottawa to loosen its own rules.

* Now, a consumer will be able to pay an agent a flat fee - zero is not an option - to list on the MLS, where about 90 per cent of all home sales are done. Agents must now pass along a seller's home phone number, if the seller chooses, directly to an interested buyer if asked.

* "Through the proactive clarifications of the existing rules, CREA believes the concerns raised by the Competition Bureau are fully addressed," the organization said in a news release. "At the same time, these amendments ensure the continued integrity of MLS systems and the accuracy of information on board MLS systems that Canadians have come to trust."

* The bureau disagreed, saying the change didn't go far enough because CREA could still change the rules at any point and place more restrictions on anyone who tried to offer innovative services.

* CREA wouldn't provide further comment, with its legal counsel stating it would rather wait for the case to go before the Competition Tribunal. The association's president, Dale Ripplinger, said the changes "wouldn't make sense to anyone who wasn't a real estate agent," before abruptly calling off a news conference.

* The vote was seen as a way for Canada's real estate sales industry to satisfy concerns raised by the Competition Bureau, which has filed charges with the Competition Tribunal alleging the real estate association makes it impossible for any of its members to offer consumers fee-based services for particular portions of a transaction, such as listing on the MLS or negotiating a sale price.

* This leads to higher prices for consumers, the Bureau says.

* The proposed changes were a key pillar in the real estate organization's defence before the Tribunal. The association must submit its response to the charges by March 25 and the organization hoped a strong vote from its members on the key issues troubling the Competition Bureau would be enough to have the charges set aside.

* The MLS has operated for more than 50 years and only registered agents are allowed to list homes on the service. The MLS trademark is owned by CREA, and each real estate board operates the service in its region.

While anyone can sell their home on their own, having a listing on the service is seen as an integral part of achieving the best sales price.

* A CREA spokesperson said the changes would be implemented "as soon as it is reasonable at each local board."

The Internet has changed the way prospective homebuyers shop for properties and has raised questions about whether real estate services in Canada are overvalued.

A 2007 court decision in the U.S. opened up similar data to Americans, leading to lower real estate fees as well as a wide range of innovative web-based real estate services.

Opening up the MLS would put downward pressure on real estate fees, the Bureau has said

It will be a very interesting few months ahead as these issues are addressed and solutions are reached.

If you have questions, please don't hesitate to contact me.

All the best!