Like many professions, realtors belong to a licensing body that provides education and licensing, as well as rules and enforcement of those rules.
Many rules are behind-the-scenes housekeeping that indirectly affect consumers but of which they may not be aware (such as how large the logo of our brokerage needs to be on any advertisement). Others influence the everyday experience of home buyers and sellers.
An example of the latter would be rules surrounding conditional sales. In my 17 years as a realtor, there have been 4 or 5 different sets of rules to govern this.
As recently as a couple of years ago, once sellers accepted a conditional sale (typically conditional on financing and inspection), they had the option to remain as an “active” status, with their listing staying on both the public and backend MLS sites and the only way to know if they were indeed conditionally sold (pending) was to ask directly.
They also had the option to be a “pending” status, with their listing showing as pending on the backend MLS and not showing up on the public MLS.
Or they could choose an “under contract” status, with their listing showing as pending on the backend but staying visible on the public MLS.
This created a lot of headaches for realtors working with buyers, especially as the market heated up and houses were moving quickly, since most sellers would stick with an “active” status. So when you had a list of six properties your buyer would like to view, by the time you inquire with all six realtors and finally hear back, perhaps only two are still truly active. I heard a lot of feedback from buyers frustrated that they couldn’t easily know what was still available.
Rules change as we adapt to an evolving marketplace. So the current rules surrounding conditional sales are that sellers must mark listings as “pending” within two business days of accepting a conditional offer (unless they have a special clause sale, in which the offer is conditional on the buyer’s home selling).
I believe this transparency is best for both buyers and realtors.
Another rule that is being debated a lot right now is an upcoming ban to “exclusive” listings in Canada. This would be a listing that a realtor markets privately to their own network and perhaps with some signage, but the listing never hits the public or backend MLS. The new rule requires agents to list any property on the public MLS within three days of any marketing of the property, including marketing privately to other realtors.
Some realtors are heavily against this change, citing sellers’ needs for privacy; for example in the case of a celebrity, high-profile divorce or someone with expensive collections or firearms. Or perhaps for listings of houses that have hoarders and are simply not in showing condition. Or houses of busy families that can’t accommodate public viewings at all times.
My personal opinion is that this is a good rule change. It creates more equality of opportunity for buyers, regardless of who their own agent is. For some exclusive listings, the seller’s realtor only markets the house to a small group of other realtors that often have buyers for that property type, specifically for higher price points.
But this means that if you are a buyer looking on your own or looking with a realtor that isn’t part of the old guard of luxury agents, you never have a chance at viewing or offering on that house.
I think that privacy and lifestyle concerns can mostly be mitigated through existing options, such as not disclosing the seller’s name on the listing, posting only exterior photos, keeping certain rooms of the home locked until an offer is accepted, limiting showings to certain time periods, requiring pre-approval letters in advance or having their listing agent present at all viewings.
I believe that it is in the seller’s best interests in virtually all circumstances to have exposure to the open market. This should achieve the highest sale price in the quickest time period. And that is what we are here to do for our clients!