- Introduction
The Canadian real estate industry, long dominated by structured commission practices and mandatory board memberships, has undergone a significant shift. This change stems from a class action lawsuit targeting RE/MAX Ontario-Atlantic Canada (OAC), which challenges longstanding industry norms regarding compensation and board membership.
- Background
Industry Context:
Traditionally, Canadian real estate has been governed by mandatory membership in local boards and the Canadian Real Estate Association (CREA). These boards enforce standardized commission structures and MLS (Multiple Listing Service) participation.
The Issue:
Home sellers claimed that the existing system forced them to pay commissions to buyer-brokers, potentially inflating home prices and suppressing competition. The practice raised questions under Canada’s Competition Act.
- Class Action Overview
Timeline: March 2010 – July 2025
Claimants: Home sellers across Ontario and Atlantic Canada
Allegations:
Mandatory MLS-linked commission structures limited competition
Sellers were coerced into paying buyer-broker commissions
These practices violated Canada’s Competition Act
- Settlement Details
Amount: $7.8 million
Reforms Implemented:
RE/MAX OAC will eliminate mandatory board membership for agents and franchisees
Potential re-evaluation of commission practices
Significance: This settlement challenges the traditional MLS-linked commission model and sets a precedent for other brokerages and boards.
- Implications for the Real Estate Industry
Short-Term Impact:
RE/MAX agents gain flexibility in board membership
Sellers may face more competitive commission options
Long-Term Impact:
Other brokerages may follow suit, potentially reshaping Canada’s organized real estate system
Increased competition could lead to lower transaction costs and greater market transparency
CREA and local boards may need to reconsider mandatory rules to maintain relevance
- Conclusion
The RE/MAX OAC class action settlement represents a pivotal moment in Canadian real estate. By addressing anti-competitive practices and challenging mandatory membership requirements, the settlement could catalyze significant changes in how real estate services are structured, priced, and delivered across the country.