Buying real estate is no exception to this trend. The conversation often goes like this: “I heard this property was coming on the market, and I locked it in before anyone else even had a chance to see it.” Sounds like a great deal, right?
Hopefully if you’re in that position, you had a real estate agent that had access to past sold data or you used a listing website’s VOW (virtual office website) feed to look at comparables. But, what if, in reality, everyone bought and sold their home this way? No tracking. No data. No record of sales history. How would you know if you paid too much? How would you even know what was for sale when you started to look?
It’s a hot debate for a couple of reasons in the Canadian real estate market. For starters, the CREA (Canadian Real Estate Association) is being investigated by the Competition Bureau for the implementation of the Cooperation Policy that was rolled out back in January 2024.
It’s important to remember that the Cooperation Policy does not ban exclusive listings:
“The policy recognizes not every seller wants their property to be advertised. Under this new requirement, ‘exclusives’ remain as an option for sellers who do not want broad exposure of their property to the public. REALTORS® can still market these exclusive listings within their own offices or in one-to-one direct communications with other REALTORS® outside their offices.”
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Exclusive listings aren’t a one-size-fits-all strategy. Agents need to assess market conditions, seller motivations and the potential drawbacks before recommending this approach.
Erin Best
Director of Real Estate & Industry Engagement
The right place at the right time.
Exclusive listings aren’t a one-size-fits-all strategy. Agents need to assess market conditions, seller motivations and the potential drawbacks before recommending this approach. If maximizing price in a seller’s market isn’t the top priority, an exclusive listing might make sense – but it’s not always the best option.
Sellers deserve the choice in how their home is marketed. Some may prioritize discretion due to their profile, while others may face mobility challenges that make frequent showings difficult. While exclusivity has its advantages, its growing use has sparked debate within the real estate industry.
What’s actually happening in the marketplace.
Although off-market transactions aren’t on the MLS, if they are facilitated by an agent that means there’s still paperwork and data available to examine what’s happening behind the scenes. A recent US analysis by Zillow provided data to support that private US sellers lost more than $1 billion collectively over the last two years. According to Zillow, “The typical home seller who did not list on the Multiple Listing Service sold their home for nearly $5,000 less.”
To echo Zillow’s findings, a 2022 report from Bright MLS revealed that homes listed on the MLS sold for an average of 18% more than off-market properties. That translates to a $53,890 price premium, based on an analysis of 1 million home sales conducted in partnership with senior research fellow Kevin Gillen at Drexel University.
I haven’t seen any concrete Canadian data yet, but that doesn’t mean this type of data isn’t out there. We just may not have found it yet.
The growing trend of off-market listings carries several negative implications, mainly surrounding market transparency. A surge in off-market transactions can lead to reduced transparency, as fewer properties are publicly listed. This lack of visibility can skew market data, making it challenging for stakeholders to assess true market conditions.
Some final thoughts.
While off-market listings offer certain benefits, their increasing use necessitates a careful examination of their impact on the real estate industry's integrity and inclusivity.
Balancing client needs with the broader goal of a transparent and competitive market is essential as the industry navigates these complex issues.
How US tariffs could shake up BC real estate.
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