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We sit down with Patrick Pichette, VP with Realtor.ca about the offerings that CREA (the Canadian Real Estate Association) offers it’s members for free. This includes hundreds of thousands of free leads on their own listings with the #1 real estate website in Canada.
TRANSCRIPTION
Hi everybody. And welcome to Brokerage Insider, the podcast where we interview the leaders in real estate and technology. And today I am so pleased to be joined by Patrick Pichette. He’s the vice president Realtor.ca focusing on strategic business and innovation. So Patrick, thanks so much for joining me here from up North today.
Hey Eric, my pleasure, nice to reconnect.
Yes, for sure. For sure, Now I’ve known Patrick a while from in being involved in the real estate standards organization and it Realtor.ca and the team up there in Canada, they’ve been big backers of RESO. And so I met him through that and I got to know a little bit how they do things differently up in Canada. And if you’re a regular listener of this podcast, you’ll know that we’ve tried to interview a lot of international folks and understand what they’re doing differently and what’s working in other countries versus what we’re doing here in the United States, particularly when it comes to during the time of the virus. So, you know, Patrick, why don’t we just start and talk a little bit about Realtor.ca and how it came about and how CREA, the Canadian real estate association kind of set out to build this national website for Canada. So why don’t you tell us a little bit about that?
Yeah, thanks. That’s a great place to start Eric. And actually the whole thing started before my time. So I joined CREA in 2012 and the site was launched back in, I believe, 1995 under the URL mls.ca. And it was later rebranded Realtor.ca in 2008. And the thought back then from the leadership at the local level through the, the local boards and at the national level you know, they, they made the wise decision to launch a national website where consumers could access listing information from I’m a less systems across the country. So regardless of which broker is represented the listing or which franchisor was doing a promotion, Canadians got a single source to see everything that was available on the market. So today Realtor.ca is still owned and operated by CREA, the Canadian real estate association.
And it’s done in collaboration with the 80 different local real estate boards across the country. So in other words, every single MLS system in Canada publishes their active listings to Realtor.ca and just you know, a couple of notable things. First of all, the site is completely funded through member do so there are no additional fees. Members pay CREA $310 a year and that includes a Realtor.ca as a member benefit as well as all the leads they get from that. And in terms of the website, there’s no advertisement which consumers really love. Over the years, we’ve been able to build up very strong recognition and trust across the country. Just recently we did a a study that looks at the perception of Realtors and Realtor.ca in, in Canada. And 92% of Canadians are aware of Realtor.ca and 85% of those that have used the site in the past would use it again. So these are, are very strong figures and Realtors in Canada are really proud of their Realtor.ca
That sure sounds like it based on those numbers. So, you know, and, and to be clear CREA or the Canadian real estate association, that’s kind of a, a version or an offshoot of the national association of Realtors like we have in the United States. That’s the Canadian version of that organization, correct?
Yeah, that’s correct. Essentially we are the equivalent of the NAR up in Canada. So we have 130,000 members and it’s very similar to the U S right. I think the NAR has about 1.3 million members and Canada is about 10% of your population. So the math works out you know, in terms of the size and scope of our association
And that’s yeah, I was, that was going to be my next question about, because I was going to say, is this, do we have the same number of agents of Realtors in Canada compared to the population? It sounds like there is where it’s about one in every one in United States about one every 30 people are going to be 300 people. One in every 300 people in the United States is a Realtor. And so it sounds like it’s about the same there. So let’s step back for a second and talk a little bit about Realtor.ca because obviously the Canadian CREA, I took a different stance than NAR did, right? Because the national association Realtors here in the States they kind of abdicated building out a website and both the first version of it that was in the mid to late nineties around the same time you guys got started. And version of that were both kind of licensed the term Realtor.com to other companies. And now of course it’s owned by new News Corp. That’s operating that website. So, you know, I, you know, I know you weren’t there, but do you know the history of kind of what made the, the CREA team decide, Hey, we want to do this, build it in house, operated in house and take on that technical investment.
Yeah, I, I don’t know yeah, that, that was a long time before my arrival, but I think it’s just the philosophy is different. You know, the fact that the national association in Canada owns and operates Realtor.ca and the fact that we don’t answer to shareholders is, you know, we’re seeing it today. It’s a great thing for our members. You know, thinking about the US I know, correct me if I’m wrong, but I think in the US the consumer over the years has been programmed to go to various different sources to find out what’s available in the market. Right. where in Canada was felt, it was really important to have this one source, this one trusted source that provided a complete view of everything that was available in, in all the MLS systems across the country.
And, you know, that might stem from the fact that, you know, something else that’s notable. We talked about CREA membership versus NAR membership in Canada, the large majority of practitioners that have a license. I think it’s well over 95% are Realtors and are members of a local real estate board and, and CREA where forgive me if I’m wrong. But I think in the US it’s maybe about 50%, right. So you’ve got a much more fragmented marketplace where in Canada, it’s been a lot easier over the years to take a collaborative approach right. In, in building out a national portal.
Yeah. it definitely seems either way. It seems, you know, from, from an outsider’s view it certainly seems like CREA made a great decision and is yielding the benefits of that being that Canadians definitely know that that Realtor.ca is a place where they can get all the listings. And there isn’t as much bifurcation of traffic as there is in the United States where you’ve got multiple players. So I want to go back to a couple of things regarding that. Number one is, you know, you mentioned that Realtors in Canada, if they’re getting, they’re getting leads, it sounds like they’re getting these leads for free from Realtor.ca and every lead on their listing goes to them. Is that correct?
Yeah, that’s correct. Again, Realtor.ca is a member benefit. There’s no, there’s no funny stuff. The listing agent gets full credit. It’s their face that appears on, on the listing and they get 100% of their leads at, at no additional
D does the Realtor have the ability to see what the person is looking at after they’ve come to them? Or is it more of a delivery where a lead comes in and says, I want more information on one, two, three, any street, and it’s just delivered to the agent and they take it from there. Is there any backend tools inside of Realtor.ca?
Yeah, There is. They can manage their email lead through a web interface. And just last year we actually launched a Realtor.ca mobile app just for Realtors. And it allows them to do several things. They get notifications when leads come in they can manage those leads, they can manage the back and forth communication with those consumers. Also, they can get a stat reports on each one of their listings. They’re able to text message or email those reports out to clients. So I wouldn’t say we have like a full brokerage CRM system, but there are definitely some tools that we’re providing to members as part of the Realtor.ca suite. And again, it’s completely built into their membership dues.
Yeah. And speaking of that, as I understand it, Realtor.ca and being a CREAn member, not only do you get these free leads from Realtor.ca, but as I understand it, there’s also other tools, various other tools, not just the app that you were talking about, but for example, from what I read when I was doing some research before, before we talked here today is that for example, you guys provide free forms, software to all CREA members, is that correct?
Yeah, that’s correct. We do provide a service called web forms which is essentially it’s a white labeled version of lone Wolf transaction desk. And the system has about 2000 different forms. So we’ve got every single form across all 10 Canadian provinces, so that that’s available. And that’s you know, another service where we collaborate with all the local boards and associations to deliver to members. Another notable service is called the Realtor.ca DDF, which is our data distribution facility. And there’s a, there’s a few components to this, but you know, the two significant ones are first of all, there’s a national shared pool. So the way this works if you have listings and you contribute your listings to the pool, you can also pull other listings from the national shared pool for your, your personal website.
And then secondly, you know, beyond Realtor.ca agents can publish their listings on other websites using the DDF, which is a listing syndication tool. And, and so our members you know, in a consistent fashion are able to send their listings to about 20 other real estate advertisement websites, but also some key partnerships that we have, like TD bank, for example who will publish Realtor.ca listings after a, a consumer on their site will use their mortgage affordability calculator tool. So, so again another tool that we’re providing to members as part of this.
So I want to dig into that and kind of two, two pieces of the DDF piece of the conversation, because, you know, it sounds like, and this is certainly the way I understood it is that’s almost like a national IDX feed of almost all listings in Canada. Is that correct?
It is, that’s a good way to explain it. The only caveat is that brokers have to opt in. So you know, we get a fee from every single MLS system of, of all the listings. But then we don’t just sort of turn around and, and open up a feed for all the listings, like the brokers have to opt into that. So you know, I mentioned TD bank, or I mentioned sites like a Kijiji or home finder. You know, we don’t just turn around and send them 100% of the listings. A broker actually has to opt into that service, but the opt in is, is fairly high. 65% of brokers have opted in, and, and that’s something that we believe in, right, that brokers and their agents should have control over their listing data and where that that’s being shared.
And is it granular in that system where we’re a broker could say, I want it to go to the TD bank website, but not to go to this other vendor.
Exactly. That that’s how it works
And could a company like TRIBUS that goes out and builds real estate brokerage websites. Could they get that feed from you, or is it really only for publishers of sites like TD or, you know, other syndication websites that might have all the listings on them?
Yeah, no that, that is a part of the service. So I think there’s about five or 600 different you know, we call them technology providers, but companies that build websites for, for Realtors. So we do provide we do work with those companies and we provide a feed. So if a Realtor wants to use a service to build and launch a website, we’ll work with them to make sure that their feed works properly. And if they’re using the national shared pool, they’re able to you, if they want to launch a website, that’s all about cottages in Ontario. You know, as long as they’re part of the pool, they can do that
That’s a great how you guys have handled it, I think is a great middle ground to what we have here in the States. Whereas, you know, there’s 625 roughly as of today, MLS is in the, in the States and, you know, there’s no pooled feed of that. Now in regionally, for example, in California, you have CR molests, which has pooled with things with other MLSs in the area to handle it. But from a vendor standpoint it can get quite costly. And then that cost gets passed down to the broker to have to go to 625 and molasses and co and collect the data. Right. But with you guys, we could, you know, if we had more broker partners in Canada, we could just go to you, have that feed and get it, get it from there and not have to go independently. And we have a try this, we have a few clients in Canada, we have Toronto and Calgary and a couple other places, and we go get the feeds individually, but it sounds like at some point it might make sense for us to just come to you and national level and get the feed through there. Right.
Yeah. And that’s really the value prop that we bring to the table. Right. Is, is that aggregation at a national level? So, yeah. Yeah.
Yeah. That’s great. Now to the second point of you talking about these feeds that go out it seems to me that obviously when, when you’re passing these feeds out, for example, to TD bank or to other websites like that, and they go get these feeds from you, it seems like it’s almost creating competitive traffic to Realtor.ca. And so how does, how does the team kind of handle that from these outside entrance building websites that have the same listings? Is it, you know, Hey, all the players come on, but because Realtor.ca is so widespread and everyone knows who cares if another entrance turns on a new website, is that kind of the thinking?
Yeah, that’s absolutely the thinking Eric, so you know, Realtor dots, he’s not the only player in, in the Canadian market and, and it, it, you know, it should not be there. As I mentioned, there are several other real estate sites Kijiji home finder, RDW there’s you know, players coming in from the U S as well. Right.
Yeah, the Zillow just opened up there. Right. Not too long ago, they opened up an entire operation. And I know they’d been planning that for a while. In fact, we have a venture capital firm, that’s part of TRIBUS it’s called TRIBUS capital. And one of our very first investments was in a company called Retsly which is based in Vancouver and Zillow bought them out and kind of indicated way then that their plan was to roll out in Canada at some point. And I know what was it mid last year or so that they actually started accepting listings and rolling them out in Canada, something like that. Yeah.
The last year or two, I don’t know the exact timeline, but yeah, I mean, you know, your point’s well taken about you know, U S players coming into the market. Zillow’s one, Red fin’s another one that, you know, is top of mind, you know you know, but, you know, just to come back to your initial question at the end of the day, a new entrance in the market means more innovation. It means more choice in, in marketing tools for our members and, you know, Eric, from my standpoint, and, you know, this will sound kind of cliché, but it’s true. It forces our team to be better. Like you know, we need to keep up with expectations and, and all these other players are just part of an industry that is raising the bar right now. And you know, so from our standpoint, there’s all this ecosystem, right.
That that’s happening around us. And we want to be at the heart of that. And one of the ways to do that is you know, through the DDF, which you know, makes it possible for, you know, whether it’s a smaller site or a big brand, like a Scotia bank or a TD, or a little bit male, which is the biggest use paper in the country you know, to participate in that ecosystem and have their initiatives being driven by by Realtor.ca I mean, at the end of the day. And I don’t remember exactly where I read this, this might’ve been from a an NDR study, but the average consumer will visit 11 different online sources before making any kind of decision. Right. So they’re going to visit these other websites, but they’re also going to go to social media. They’re going to go to their bank website to find out how much they can afford. They’re going to look up editorial contents on newspapers. So again we’ve got a much more holistic view on, on the Canadian marketplace and we want to be at the center of this ecosystem, hopefully bring that properly.
Oh, for sure. And actually kind of perfectly leads me into something that I wanted to ask, which is, does you and your team that’s running Realtor, I CA do you view the customer as the agent, the Realtor, or is your customer when you’re working on Realtor.ca is it the consumer? How do you think about that?
Yeah, so the answer is both, right? It’s both. So yeah, we are a Realtor, so absolutely we need, and we should be delivering value to our Realtor members. Right. But that doesn’t mean that we can’t offer a great user experience. It doesn’t mean that we can’t lay or other sources of data that consumers are looking for. I mean, at the end of the day, it’s the consumer, that’s driving the bus, right. And for us to remain relevant in the marketplace you know, we need to meet their, their expectations of what a real estate portal should, should be all about. So, yeah,
Go ahead. I was just going to say, let’s dive into that and that extra data. So something I wanted to ask you about is, I know you have a partnership with a company based out of Canada, that we’re big fans of here at drivers, which is the local logic. And I know you are one of, if not their largest site that’s adopted their data and they have some great data on there. It seems like you guys have really stepped up the game when it comes to that. How has the adoption been by consumers of looking at all of this local relevant data purchasing a home? Do you see a lot of consumers engaging with that content? Absolutely.
And I’m glad you mentioned them because you know, we do partner with a lot of different startup companies, and this is one success story that I would like to talk about, but you’re right. A Canadian company out of Montreal and essentially it’s allowed us to transform the site. And what I mean by that is allowing users to consume the listing content based on their lifestyle preferences. Right. And the great thing about local logic you know, I kind of call it like, it’s kind of like walk, score on steroids. So, you know, you get a score on everything from walkability to you know, transit, cycling to proximity, to schools grocery stores we’ve been able to layer all sorts of data, like a school catchment areas for the entire country. So it’s, yeah, that kind of partnership has added a lot of value.
And you know, we, we’ve seen some really key metrics change over the last couple of years. So first of all, yeah, traffic is way up market share is way up, but we’re also seeing things like our bounce rate is way down, right. We probably have a bounce rate of 10 to 15%. And I think usually if you can get under 25%, you’re doing really well we’re seeing a higher lead conversion rate as well. So when consumers are, are, are consuming this extra data, they’re more likely to convert into a lead for, for Realtor, right. And that kind of contradicts those that are fearful that, well, the more information that you give a consumer, the less you know, the less of a chance that you have to convert them into a, a client for a Realtor. So yeah, it’s checked off a lot of boxes. It’s enhanced the consumer experience and yeah, our members are benefiting from that, that kind of partnership.
Yeah. And we’ve seen the exact same thing too, which is the more data you provide and you can put it behind a registration wall, at least that’s what we’ve seen. And I know Realtor.ca does not require that, but the more data you provide or the more engaged that you can make the consumer the far more likely they already use that brokerage or that agent for what we do here, try this. And, and we’re testing out, we’ve been testing out local logic data for a few months. And in fact we become such a big, big fans of them that we’re offering the option to add it to all of our broker customers in the United States and in Canada. And they’ve, they’ve expanded heavily here in the United States over the past 12 months. And they have some just killer data for those listeners that haven’t seen it definitely go take a look at Realtor.ca and on every one of their listings, they have neighborhood information and map-based data.
Patrick here mentioned the school zones. I think you call in the candidate, you called them attachment districts. Is that correct? Yep. So, you know, in the States here, we call them school districts or attendance zones. So take a look at what they’ve got on Realtor.ca it’s, it’s quite impressive through the partnership they have with Local Logic data. So you know, a couple of more questions for you, cause I know we’re running out of time here, but one interesting thing that goes back to one of the very first things you said is that you know, I know that CREA owns the trademark in Canada for the word MLS. Right. and, and you guys protect that trademark. So in in the use of that MLS trademark do they all operate under, like, do, do all of the MLSs in Canada operate as Realtor CREA members, or are there any MLS says, you know, I understand the trademark term, but are there any, any search sites that have listings that, that Realtors put their listings on that are not part of it? Like we have in the States, for example, Seattle’s MLS in the States is not a Realtor owned or Realtor, Realtor operated MLS it’s, it’s owned by couple of the large brokerages in that market. So they don’t have to follow the same rules that the national association of Realtors in the States pushes down to them are their MLS is like that in Canada. Or does everybody play under that license of you guys owning the trademark for, for MLS?
Yeah. Yeah. So there’s a lot, a lot to unpack there, Eric let’s, let’s, let’s take a step back like you know, real estate in Canada in the U S basically functions the same way, but there are some differences, and I think this is one of the bigger differences, right? So in Canada, it’s the local real estate board that runs an MLS system. They’re not set up as a separate organization. Now, there are a few reason, examples of local real estate boards that have gotten together to form a, a separate company to run a regional MLS. But in most cases, it’s just, it’s just one entity. So the DNA of a local board is to run an MLS system. Right. so yeah, they, they do use the trademark and, and, you know, in Canada, we’re really lucky to have a registration over the MLS trademark.
But that also means that our member Realtors and our member boards who, who are the only ones who can use the trademark do need to use it in the correct form and context. Right. So you know, in other words, the MLS Mark what’s only be used to identify services that are provided by Realtors as part of the cooperative selling system. So in other words MLS must never be used as a as a synonym for a database. So you can say, for example, I provide MLS services, or I can show you some MLS listings, however, you can’t say search the MLS, or I can list on MLS. Right. So we are so the really, you know, looking at the bigger picture, you know, we’re really proud of this cooperative system called you know, at MLS and it’s supported by the MLS systems that are run by the boards and Realtor.ca is an extension of MLS.
No, did I say yes? Yeah, for sure. It’s, it’s it’s so fragmented. And you know, some MLS is in the United States are very restrictive on the, using the term search, the MLS a while other ones it’s completely wide open, and you’ll find many agent and broker websites search CMS when in actuality that doesn’t necessarily ring true because obviously in the feed that their vendor gets, they may not have every single listing that’s in DMLS. You know, here in the States, we have things called GOWs, which is a separate feed that has more data in it. And eight agents and brokers can restrict their listings from going out into the IDX feed. And then you are not truly searching the MLS. If you’re searching that website, you’re at, you’re searching a subset of the listing. So it’s very different here. And I think part of it is because of fragmentation and part of it is, is just the, the change in governance and not being owned or operated by a Realtor association, a local board like in, like I mentioned in Seattle where they get to play by different rules than other people do because of that.
So two last questions for you here, Patrick, number one, how’s the market in Canada right now, especially after the virus, are you seeing the same thing we’re seeing here in the States where the big cities people are kind of leaving them and the suburbs and, and the outer areas are having massive growth or is it different there in Canada?
So currently like in the U S the market is, is very, very strong. In fact, just on Monday, we released our July numbers. And so I was a record setting month, like, and that’s a big contrast to, if we go back a few months to April, that was our worst month ever in terms of transactions in July is, is a record national home sales Rose 26% on a month over month basis. And that’s nationally. But if you want to focus in, on certain markets, the greater Toronto area Rose 49% Vancouver, Montreal 39. So yeah, markets across the board are, are very hot. And essentially what’s happening is that across all major markets you know, they’re grappling with a serious imbalance between supply and demand. So we’re seeing buyers returned to the market in droves, but many sell sellers are not listing. So as a result our inventory is at a 16 year low right now.
Yeah. We have the exact same thing in the States. Exactly the same problem. There’s not enough inventory for the demand, particularly in second home markets like beach communities and Lake communities. There’s not nearly enough inventory that’s out there. So it sounds like it’s the it’s pretty, pretty similar. The one differences is you’re talking about in Toronto which is a big metropolitan area. Something like the New York of Canada you’re seeing an uptick, whereas I know in New York city, you know, Manhattan, et cetera, people are getting out of there and looking to buy out in the far suburbs. But everywhere else in the country is absolutely on fire. And there is a low all time low of homes for sale. So it sounds like in all other ways, it’s, it’s very similar, which is it’s great. It’s great for our industry. It’s great for Realtors in the States and in Canada. So one last question for you, Patrick, and then we’re out of time, is I, and I ask all my guests this question, and feel free to take a second if you need it, but if you could change and wave a magic wand over the real estate industry in Canada right now, what’s one thing that you would change about the industry.
Hmm. That’s a good one. You know, I would you know, again, we, we, you know, we have a lot of members if we could get everybody to buy into the fact that, you know, giving consumers more data is good for the profession, that would be that that would be really great. You know, getting a better understanding that the value prop of a Realtor is not being a gatekeeper to data, but it’s the interpretation of the information it’s being that trusted partner it’s helping clients you know, through a very emotional kind of journey. I think that would be great. I think we could really accelerate our roadmap when it comes to you know, Realtor.ca and the other things that we’re doing. I couldn’t agree with you more I’ve long said that a Realtor should be more like a financial advisor.
Anybody can go to any website out there and find out what stocks have traded for, for since forever. There’s even more transparency in the financial services industry. And yet still most people use a broker, use an advisor to invest when they, when they’re looking for it, when they’re looking to make an investment, because they know they need that person to kind of double check them and make sure they’re not making a bad financial decision. And I think Realtors are the exact same way. It’s, you know, it’s not a data gatekeeper, as you said it is a, an advisor, a consultant, somebody you’re having and paying to make sure you’re making the best for you and your family.
So thanks so much, Patrick, for joining us again. Patrick is the vice president for a Realtor.ca focusing on strategic business and innovation. Patrick, thanks so much for joining us. You have been listening to “Brokerage Insider” the podcast where we interview the leaders in real estate and technology, make sure to subscribe. So you get episodes like this, and future wants delivered direct to your inbox. Thanks so much for listening.
