From time to time, some real estate agents are disgruntled with the Owner/Seller who decides to “go it alone”. These people are known as FSBO’s or “For Sale By Owner”.
We looked at the 40 year track history of compensation for lawyers and agents in real estate transactions.
The problem for lawyers was that they occupied the entire field. They provided a service which couldn’t be purchased elsewhere. They were a “monopoly”. The consumer had no where else to go. Take it or leave it. The legal profession pushed one more button and that was “price”. The tariff was standard. It set out the rates that would be charged.
The Competition Bureau said that the Tariff was anti-competitive.
The saving grace for the real estate industry is the “FSBO”. Everyone should be able to sell their own house. Who needs an agent? No one! Hence, if everybody can do it on their own, then really, no one needs this service. It’s non-essential. It’s helpful to some, but not to others. So, there’s really no need to aggravate the system. Commissions are subject to competition and there is no need for regulation.
At least, that’s the thinking.
So, real estate agents should be grateful to all the FSBO’s out there.
Brian Madigan LL.B., Broker