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Tuesday, February 9, 2010

Federal Competition Bureau agrees with Bousquet

Calls for making real estate sales info public

Posted Tue, Feb 9, 2010 at 7:07 AM

Last year, I argued that real estate sales should be a matter of public record:

Consider that the sale prices of houses are not publicly available from the government, as is the case in all of the US. (Assessed values are available in Nova Scotia, but they often have very little to do with sale price.)
It's true that real estate agents will give prospective buyers a sheet of paper listing nearby sales, but that information does not come from government; rather, it is self-reported by other real estate agents to the Multiple Listing Service database and is not independently verifiable. Real estate agents, who work on commission, would benefit by dishonestly reporting inflated house sale prices.
When I raised that possibility with local agent Steve Patterson, he rejected it out of hand and insisted all agents would be truthful. But he raised a related issue: "What about private sales---why can't I access that information?" Patterson argues that those who sell privately are probably paying more than they would through an agent, but because the sales price isn't public, there's no way to know.
Capitalism, the argument goes, is the perfect economic system because informed markets lead to the most efficient allocation of resources. But here we have a system where only one side of a transaction---the seller, and only some of those---knows how the product is valued. Buyers are uninformed, so the market is likely skewed against them.
It'd be as if every time you went to the grocery store, you had to separately negotiate the price of eggs and you were not allowed to know what eggs sold for at the grocery store down the road. It's the antithesis of an informed free market.

Seems the federal Competition Board agrees with me:

The federal Competition Bureau has launched an aggressive attack on the Canadian Real Estate Association, challenging its rules governing the Multiple Listing Service and calling for a radical change in how homes are sold in Canada.
“Our concern is that [CREA] are improperly and unlawfully leveraging [their control over MLS] in order to impose these restrictions and to deny competitive forces and to deny good old-fashioned market competition,” said Competition Commissioner Melanie Aitken. “This case is focused pure and simple: Let consumers have the choice, let agents have the opportunity to satisfy and serve those choices.”

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Comments (5)

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Price is not on the public record in NS.
The Land Registry contains mortgage/credit info but you have no way of knowing how it relates to the price paid.

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Posted by Joeblow on 02/16/2010 at 4:47 PM

I asked assessment people, service NS and realtors this very question last year, and they all said it wasn't public, anywhere. But I'll double check.

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Posted by Tim Bousquet on 02/09/2010 at 7:54 PM

I'm sorry but dollar amount for all real property sales is reported in the land titles office - even those sales that were handled privately. It is a matter of public record in Ontario.

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Posted by property buyer on 02/09/2010 at 5:59 PM

The *dollar* amount isn't.

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Posted by Tim Bousquet on 02/09/2010 at 2:49 PM

real estate transactions are public record, just go to your local land registry office

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Posted by Citizen in Ontario on 02/09/2010 at 1:14 PM

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