The Ontario Government is considering an outright ban on multiple representation on real estate transactions. This means that each party to a real estate transaction, the buyer and the seller, must each have their own real estate agent.
So, what is the downside?
Even if your agent happens to know the perfect person(s) for your property, those people would have to find someone else to represent them in order to buy your home.
This is a cost to the seller. In a transaction where the buyer and the seller are each represented by a different agent, the commission is evenly split between the two parties. For example, a 5% commission is divided evenly at 2.5% for each side. However, if the seller or listing agent represents both the buyer and the seller, the commission for “double ending” the deal is substantially reduced; usually to somewhere between 3% to 4% depending on what has been agreed to.
You, the seller, will pay substantially more because of this proposed legislation. On a $1m dollar home, you will pay between $10,000 to $20,000 more to sell it. That’s a lot of money.
This legislation could result in increased sale costs upwards of $10,000 per million
In addition, a ban on multiple representation would deny purchasers and sellers the ability to choose to work with a REALTOR® they know and trust when making the largest financial decision of their lives.
Has this been done?
The Ontario government is simply following the updated standardizations in British Columbia. Yet, did they not learn from the Foreign Buyers Tax debacle? Has our government considered the problems in the marketplace and harm consumers when The British Columbia Government eliminated multiple representation?
We in Ontario deserve better.
Consumers should be able to work with the REALTOR® of their choice. In other words, consumers interested in the same property should, through informed consent, be able to work with the same REALTOR®.
What can you do?
Email your MPP that when it comes to the largest financial decision of your life, you the consumer should be able to work with a REALTOR® you know and trust.