The real estate industry is in the middle of a huge shift in how it is "done", now that the "real" 21st Century is in play.
In Canada, the information on real estate has been controlled by CREA, the Canadian Real Estate Association, and the MLS (Multiple Listing Service) has had control of all real estate information. A consumer, then, had to deal with a realtor, to be able to discover information on properties.
In the U.S., for some substantial time, there has been an open door policy in information, with many competing options to the MLS system -- Trulia, Realtor.com, Zillow, plus different models of real estate sales, such as Redfin. These U.S. based models have tried to enter Canada. Canadian companies have tried to introduce their own search parameters, and have been prohibited from doing so. An Ottawa company decided to sue CREA, under the Competition Act, by claiming that the best interests of the consumer were not being served. Other companies, in various parts of Canada, including realtors who work under the MLS system, have tried, at various times, to "do their business model" with the information on properties. CREA, and therefore the Boards and realty companies/realtors, have been able to maintain their position in the transaction process...they controlled the information.
The government was supposed to respond, by December 2009, re the lawsuit. The timeframe for a decision has been extended. Zillow, Redfin, and other consumer oriented businesses, are awaiting the outcome.
CREA, and the MLS system, is really a 20th Century business model. The internet totally changed how the car industry works, plus the stock market side of investment. It is the real estate industry's turn to face this dramatic shift in how information is disseminated. The consumer is now in charge of all business models, and search engines have already replaced realtors as the arbiters of knowledge. The internet has also erased geography and time, so that buyers may turn up from all over the world. That "global village", promised by Marshall McLuhan, back in the 60s, is with us. The role of a real estate agent, then, has changed. Many realtors and companies have not recognized the change, and are wondering why tried and true ways of doing business no longer work.
I often think we are in a moment in time, of huge societal change, not unlike the world portrayed in Charles Dickens novels. He was describing the passing away of the old Agrarian world, and the supplantation of it by the new Industrial Age. Depending upon where one sat, in the shift moment, it was either pain or profit. That's where we are today. An old way of dealing with the world is passing away, and a new one entering. The hybrid moment is almost over.
A consumer driven world means a new form of connection between sellers and buyers. Unless a real estate company has renovated its way of accomplishing its business, to meet this challenge, and unless individual realtors have remodelled themselves to fit the new paradigm, I can see that there will be a lot of "disappearing acts" occurring. The outcomes for the stock market side of investing are before us. Etrade is there! The Redfin model is at our border. Can't stop it...it's a shift moment between two realities.
What is it, again, that a real estate agent offers a consumer? That's for next time!
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