Author: Jeff Agyemang

This post is a continuation of the Mobile Age of Real Estate series. Click here to start reading from the beginning.

Open data = Access… Access = Knowledge… Knowledge = Progress?

What does it mean when you have access to an ocean of information but keep it all to yourself? Everyone involved in real estate, and many who have just been trying to provide a better experience, have been asking this question when it comes to open source data from the Toronto Real Estate Board (TREB).

TREB held the largest monopoly in Canadian real estate; 50,000 of the 70,000 realtors in Ontario are members of TREB. The real estate board also owns, and manages, the Stratus MLS (Multiple Listing Service) that feeds new and active listings to TrebHome.com. Most of the real estate transactions in the province flow through their MLS system, which means almost all home sales data is property of TREB.

TREB said their concern regarding open data is for the privacy of homeowners. This is clearly nonsense. How can privacy be the concern when title information is already public knowledge through the Land Registry Office? The clearest reason for them to withhold this data is to maintain the monopoly they have spent literally decades working to protect. The fear of real estate agents becoming less relevant as a result haunts TREB and with good reason. People no longer look at realtors as the gate keepers of real estate information anymore. We are more like advisors, guiding our clients through the process at this point. Prospects often reach out to me with properties they want to see already in mind before they’ve even gone through a pre-approval. This seems like a risk to the livelihood of some TREB members. In my opinion, this risk is purely psychological. If open data will prevent an agent from serving their client to the best of their abilities then there is NO reason they should be in the business. Stifling progress for the sake of maintaining the status quo serves the interests of a privileged few. This does not move our industry forward. All it does is make us less competitive vs other markets!

In case I haven’t already made this clear, open source data is the most necessary step we need to take to progress our real estate industry. Just look at the US and the progress made with access to their MLS and some technological innovation. Like our real estate boards, the National Association of Realtors (NAR) were holding back competition by blocking MLS access to internet brokerages that offered online services. It literally took the United States Department of Justice (DOJ) to file an antitrust lawsuit in September 2005 against NAR for them to settle in 2008 and agree to give access to internet brokerages. There would be no Zillow (currently lobbying our government to feature Canadian listings on their site), Truila (owned by Zillow), or Redfin without that settlement. By providing access NAR opened the door to unheard of innovation in the real estate space, while creating opportunities for realtors to go from local to national brands.

As a Canadian, I don’t want to see more American brands taking over our space. We have plenty of home-grown talent that just needs the right juice to thrive. Canadian real estate has been in dire need for real innovation that influences the sales process. The US seems to have gotten that message a while ago, and though we are late to the party, I for one am glad we’ve arrived.

TREB attempted to drag out a battle that started in 2011 with the Competition Tribunal. A ruling was made in April 2016 that TREB’s practices of prohibiting sharing information are anti-competitive. The board also lost their appeal to the Federal Court of Appeals in December 2017 and had their appeal dismissed by the Supreme Court of Canada in September 2018. Realty brokerages are now permitted to post sales data in real-time on their password-protected websites. But all this did waste time and delay the inevitable. Progress stops for no individual, or institution, and the progress I’ve been seeing in the real estate industry blows my mind… Unfortunately, most of the innovation is south of our border…

I have an Associate Degree in Culinary Management, and I sell real estate. Yes, you read that right. Your first thought might be, “Who’s this guy and why the hell should I even keep reading?” And you wouldn’t be wrong in that first reaction. What would someone that spent a few years of his life preparing chicken stock and refining his knife skills know about the real estate market? More than you expect actually…

I bought my first piece of real estate at age 22 (currently 29 as of publication) before I ever thought about selling homes. A one bedroom, preconstruction unit off Lakeshore’s waterfront. The broker that sold me on the unit convinced me that I’d likely triple or even quadruple my down payment if I invested in preconstruction. I had no reason not to believe her. She was the professional, and I was a kid trying to figure out the most “adult way” to use the money I had saved up. “I’d be first out of my friends, and one of the first in my age group to own property”, I thought to myself. I bought the unit and didn’t look back. From there I became so interested in real estate that I researched what I needed to do to sell homes. I started taking OREA (Ontario Real Estate Association) courses late in 2013, and by summer 2014 I was out selling!

It’s January 2019 now and I’m still in the business of selling homes. During the last 6+ years much of my time has been spent studying real estate economics and historical trends, and new technologies moving the industry forward. I do this, so I can help clients making BIG life changing decisions. I look back at my experience buying the preconstruction unit at 22 years old and realize two things: 1) I could make A LOT investing in the right real estate during the right market, and 2) An uneducated buyer is a buyer without power, and a powerless buyer can be sold any load of s*** so long as it’s pitched the right way. I was an uneducated buyer that was sold what some might call “hyperbole”. Had I truly known what I was doing, I may have put my money into a resale townhome in 2012 instead of a preconstruction condo. The average price of a townhome in Toronto went up over 96% since that time. My preconstruction unit has appreciated just over 55% since then, and, because it STILL is not complete, I can’t sell it and take profit.

Don’t get me wrong, an appreciation of 55% is great, but it’s taken 7 years to compound (as I said which I still cannot access). An agent looking out for my best interests may have guided me towards a higher return investment, or helped me piece together that in an environment where interest rates are near zero buyers are more likely bypass starter homes (like condos) and demand freehold options (detached, semis, towns). Whether she was looking out for her own pockets first or was genuinely unsure of the direction our market was heading I’ll never know. What I do know is that many opportunities were missed because I was an uneducated buyer. The lesson was learned, and education on real estate economics became my focus and that change happened when I finally got access to the right information.

In this series I will discuss what I like to call the Mobile Age of Real Estate. As new technologies and access to information become more convenient, it will dramatically change the real estate process. Consumers will become more educated, and transparency will lead to more confidence in their buying decisions and the useful industry professionals that help to guide them through the process. Things that took days to complete, mortgage applications and title transfers for example, will be streamlined with great efficiency. In fact, they already are! And that’s the exciting part. We don’t have to wait long for the mobile age to reach us… It’s already here!