On May 23, 2024, Information Technology Systems Ontario (ITSO) provided a memo to the boards of its member associations about new exclusive listing functionality it planned to implement as early as this month within its Matrix system.
ITSO sought feedback from its CEO Advisory Group on whether the functionality should be made available system-wide or on an opt-in basis as a non-basic service. However, the organization halted its efforts less than two weeks later.
Issues with adding exclusives to an MLS system
REM obtained ITSO’s memo, which discusses the issues of adding exclusive listings to the Matrix system after those listings have sold (which is often done for tracking statistics, financing purposes or use in comparative market analyses).
It notes, “The practice raises concerns under Rule 2.08, which provides that a listing is not acceptable if it is not available for showings and the registration of offers. If a listing is already sold before it is entered into the ITSO system, then it is not available for other realtors to cooperate on and therefore is a violation of Rule 2.08.
It is extremely frustrating for realtors to see a new listing, or have their clients see one in an auto-email, only to find out that the property is already sold when they contact the listing realtor for a showing. Adding these listings as MLS listings diminishes confidence in what is supposed to be a cooperative system. Further, the sale price for an exclusive listing is not necessarily reflective of what would be obtained for an MLS listing, so entering these listings into the ITSO system can skew statistics.”
How the functionality would help the industry
The memo goes on to note there are legitimate reasons for entering these listings into ITSO’s system: “Historically there was no easy way to capture this data for sales records or for financing purposes. The ITSO board of directors wants to respond to the needs of our users so that they will not be forced to breach the MLS rules or, alternatively, find a workaround to avoid compliance issues.”
It then explains this is why ITSO created the Alternative Listing Task Force (ALTF) in 2022, which determined the following, and unanimously agreed to recommend proceeding with the closed exclusive listing functionality:
- “Augmenting the ITSO system with exclusive listings would be beneficial for statistical and financing purposes.
- Enabling realtors to put exclusive listings into the ITSO system directly to a pending or closed status will likely increase compliance with Rule 2.08 for MLS listings, as there will no longer be a need to add exclusive listings to system inaccurately as MLS listings.
- Adding this functionality to the ITSO system could also potentially entice more commercial realtors to put listings into the ITSO system, as MLS rules are often seen as a constraint for commercial listings.
- Augmenting the ITSO system with exclusive listings could also provide an avenue for assignment listings to get exposure to realtors without being publicly advertised.”
The process and journey
The memo continues to describe the process and journey ITSO took in developing the exclusive listing functionality.
ITSO’s board of directors approved the ALTF’s recommendation in September 2022 along with its finalized rules for sold exclusive listings in March 2023, which the CEO Advisory Group discussed in April 2023. After some delays in development work and the Trust in Real Estate Services Act (TRESA) coming into effect on December 1, 2023, ITSO changed the rules for exclusive listings to include TRESA terminology changes before meeting with the CEO Advisory Group in December 2023. The intent was to consult about active exclusive listings, but this was put on hold (due to member associations’ work being done with the Ontario Realtor Wellness Plan).
The ALTF met this year to discuss and finalize changes to the exclusive listing rules to accommodate active listings. This caused a delay in launching the functionality for sold exclusives.
In the end, ITSO’s board approved the exclusive listing rules at its May 2024 meeting. The board found the proposed system enhancement would be welcomed by realtors “to fill a void they have been working around” along with association staff “who should see a reduction in listings violating the MLS rules as a result of providing a legitimate method of adding sold exclusive listings to the system for internal use.”
The memo encourages member associations and realtors to familiarize themselves with the exclusive listing rules and notes that Rule 9.01 requires realtors to obtain consent from their clients to collect, use and disclose the exclusive listing in the ITSO system (with sample language provided).
Response from CREA
After the memo was sent, ITSO had planned to consult with its members on the new functionality and determine how the service could be implemented. However, this was stopped on June 4,…
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