The Federal Court of Appeal has rejected an appeal from the Toronto Real Estate Board to withhold proprietary real estate sold data – the latest outcome in a hard-fought battle that has raged since 2011.
At around 3 p.m. EST, the Court revealed it would uphold the ruling made by the Competition Tribunal in April 2016, which found TREB’s practices to be anti-competitive, stating the real estate board’s arguments that sharing its sold data database would violate privacy and copyright laws fell short. It finds TREB had not acted on privacy concerns before explicitly telling Virtual Office Websites (VOWs, which includes Zoocasa) they couldn’t utilize the data.
“… the Tribunal found TREB’s concern with privacy to be unpersuasive. We will turn to this issue in greater detail later in these reasons; suffice to say at this point that, looking at the record before it, the Tribunal found little evidence that TREB’s VOW committee had considered or acted upon privacy concerns before establishing TREB’s VOW Policy,” reads the appeal statement.
It’s a win for market transparency and consumer empowerment, says Lauren Haw, Zoocasa’s Broker of Record.
“The ability to share and display market data (such as past-sold prices) with consumers is a positive development for the real estate industry,” she says. “We strongly believe in a model where consumers are educated and able to work with experienced agents that act in an advisor capacity – not as gatekeepers of information.”
Some of the information that may now be made publicly available includes past asking vs. selling prices, realtor commissions, and the number of times a home has been listed. Previously this data could be shared between an agent and their clients, but could not be published or distributed to the public.
TREB has since stated it is “disappointed” in the outcome of the appeal and plans to take its case to the Supreme Court of Canada.
“TREB disagrees with the decision of the Federal Court of Appeal and will be seeking leave to appeal the decision together as well as an order staying the decision pending the outcome of that appeal, if granted. TREB believes strongly that personal financial information of home buyers and sellers must continue to be safely used and disclosed,” said TREB CEO John DiMichele.
The Fight to Free Sold Data
The Competition Bureau first took TREB to task in May 2011 for what it alleged were anti-competitive practices. It made an application to the Competition Tribunal to prohibit the board from “enacting, interpreting and enforcing rules, policies, and agreements” that prevent real estate agents and brokerages from sharing information from past sold deals online.
That the board had exclusive use of historical sales data, the Bureau argued, was unfairly preventing online brokerages from using it to improve their own business offerings, such as data-based tools and resources. It also argued that it took power from consumers by limiting their research options.
“If TREB’s member brokers were able to able to offer VOWs with online search capabilities, their customers could conduct their own searches for, and review information relevant to, the purchase and sale of homes in the GTA, without the personal assistance or direct intervention of a broker,” the tribunal states in its application. “Currently, brokers and their staff obtain such information from the TREB MLS System themselves and provide it their customers by hand email, or fax.”
However, Haw says the point of releasing sold data isn’t to do away with the realtor-buyer relationship – rather, it’s to widen buyers’ and sellers’ access to the information they need to make their best real estate move.
“By sharing more information, we are able to make for a more transparent buying and selling process. Agents will provide value by interpreting price points, market trends and fluctuating data for their clients,” she says.
“Zoocasa’s users are researchers and come to our site looking for relevant information to influence their home purchase – such as school boundaries and rental options. Past-sold data will help them make more informed decisions.”
TREB’s Privacy Argument
The Tribunal ultimately ruled in favour of the Bureau in April 2016, and TREB was ordered to change their practices as well as pay $1.8 million. However, the board immediately appealed, citing breach of copyright as well as privacy concerns for buyers and sellers, whose transaction information would be used without their consent.
The order was stayed in August as Justice Mary J. L Gleason found TREB had “raised at least one serious issue with respect to the possibility that the Tribunal’s order failed to take adequate consideration of property owners’ rights.”
“When analysing the privacy issue, the tribunal focused largely on whether TREB’s motivation for raising property owners’ privacy rights stemmed from a legitimate concern about those rights, or was tainted by an improper desire to maintain the dominant position of the majority of its members, who do not rely on web-based services,” she said.
What’s Next for GTA Real Estate and VOWs?
Now that the use of data has been clarified, the questions remains of how it will impact the GTA real estate landscape, pending any additional appeals to the Supreme Court. TREB has been aggressive in the past to stop data-sharing efforts – most recently, it served a cease-and-desist order to financial data analyst Shafquat Arefeen, who had compiled two-years’ worth of data into a series of market trends charts on a personal website. It was a hit, drawing 13,000 visits before the Board ordered it be shuttered. Rather than face a potentially pricey legal battle, he complied.
Zoocasa, while under previous ownership by Rogers Communications, complied with a similar request in 2015, ceasing the distribution of regular sold data newsletters. However, other Canadian jurisdictions, such as Nova Scotia, allow the sharing of such data, and it’s commonplace practice in the United States.
What do you think about the Competition Tribunal’s outcome? Leave us a comment below.