Real Estate

Deal under the table after being on MLS, is that legal?

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  • May 31st, 2017 7:26 pm
[OP]
Deal Addict
Oct 29, 2010
4286 posts
632 upvotes

Deal under the table after being on MLS, is that legal?

I could be 100% wrong about the scenario I'm about to tell here as it's fairly new and it could be that things are just slow to update but I'm curious about this situation.

One of my neighbors had his townhouse listed this week where they were supposed to have an open house over the weekend which I wanted to go and see the inside of it.
I look on MLS on Sunday and I notice it doesn't show as open house, so I think maybe I seen it wrong before.
Towards the afternoon I see quite a few cars in their driveway and on the street and after some time I hear outside a bunch of happy people and I hear one of them say to the other, welcome to the neighborhood.
I take the dog out a few hours later, I notice the realtor removed the for sale sign and a day later it's no longer on MLS at all.
I wait a few days and ask my realtor to take a look at his MLS and all it says is that it was removed, no mention of it being sold.
I talk to my mom about it, and she says it was probably sold under the table so everyone can get some break on the price/commissions and avoid paying brokerage fees/taxes.

Again, I could be wrong about this as it could have yet to update or maybe they really did remove it from the market because they believe it's too slow right now or for a different reason.
But if I'm not wrong and they sold the house without MLS, let's say they just sold it for 100k above anything else that was sold there recently, that is like me losing 100k of equity right there just because they don't want to have it on MLS after it clearly was on MLS.

Am I being petty for being upset about it? Also keep in mind that I just moved into this neighborhood, so you can be sure that they used my purchase price as basis for their asking price and/or sale price.
23 replies
Deal Addict
Mar 20, 2017
1210 posts
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Using MLS is not a requirement. Some properties are sold completely outside MLS, some of them have FSBO ("For Sale by owner") mark saying it totally realtor-free. Seller does whatever he wants because its his property.
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Dec 13, 2016
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Your mom seems to be a very knowledgeable woman.
Sr. Member
May 3, 2013
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Toronto
You are assuming most comparables are done via MLS. While most comparables are done from MLS, one can also look at sale prices on geowarehouse. If the house is indeed sold, the sale price will be reflected on geowarehouse in a few weeks (and you will also see new neighbours).

Your mom is probably right. Pulling something like that is risky as every party involved has to agree. The agent can't pull that off too many times as the brokerage may notice a pattern. The fines are hefty, by RECO and CRA.
[OP]
Deal Addict
Oct 29, 2010
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632 upvotes
GalvToronto wrote: Using MLS is not a requirement. Some properties are sold completely outside MLS, some of them have FSBO ("For Sale by owner") mark saying it totally realtor-free. Seller does whatever he wants because its his property.
I know it's not a requirement but if it was on MLS, that means the seller had an agreement in place between the brokerage and the seller for a period of time, those agreements usually state that if you sell in any form during that time period, you still need to pay the commission to the broker.
So if indeed they "pulled it off" from MLS and sold it under the table, they basically cheated the broker too which I'm sure isn't going to be happy if he finds out.
[OP]
Deal Addict
Oct 29, 2010
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realtorhome wrote: You are assuming most comparables are done via MLS. While most comparables are done from MLS, one can also look at sale prices on geowarehouse. If the house is indeed sold, the sale price will be reflected on geowarehouse in a few weeks (and you will also see new neighbours).

Your mom is probably right. Pulling something like that is risky as every party involved has to agree. The agent can't pull that off too many times as the brokerage may notice a pattern. The fines are hefty, by RECO and CRA.
Is it guaranteed to be listed on Geowarehouse if it wasn't listed on MLS? Or are you saying if a deal was completed without MLS but in a legit form it should be there?
Sr. Member
May 3, 2013
618 posts
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Toronto
If the title of the property has a new owner(s) registered to it, it will be on Geowarehouse. If someone removes/add a name from/to the title, it will show on Geowarehouse.

Geowarehouse reads the data from Teranet. Whenever a property changes hand, lawyers are needed because they can access Teranet and change the names on title. The way Teranet works (and this is just a logical assumption mixed with hearsay experience) is two different lawyers have to be involved in the title name change. One lawyer will have to request the change (the one representing the buyer) and the other lawyer (representing the seller) has to confirm it. As you can see, "MLS" does not need to be involved. MLS is merely the go-to place to look for listings.
Deal Fanatic
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Dec 27, 2009
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Why do you care? I would just file something like that which has zero effect on my own life under "it's none of my business".
Penalty Box
Aug 11, 2005
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Didn't you read his post? Hes missing out on 100k in equity increase since it wasn't listed on mls! How can he reach a newer paradigm if he doesn't have gainz
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[OP]
Deal Addict
Oct 29, 2010
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realtorhome wrote: If the title of the property has a new owner(s) registered to it, it will be on Geowarehouse. If someone removes/add a name from/to the title, it will show on Geowarehouse.

Geowarehouse reads the data from Teranet. Whenever a property changes hand, lawyers are needed because they can access Teranet and change the names on title. The way Teranet works (and this is just a logical assumption mixed with hearsay experience) is two different lawyers have to be involved in the title name change. One lawyer will have to request the change (the one representing the buyer) and the other lawyer (representing the seller) has to confirm it. As you can see, "MLS" does not need to be involved. MLS is merely the go-to place to look for listings.
Very helpful, that does ease my mind a bit, thanks.
Chickinvic wrote: Why do you care? I would just file something like that which has zero effect on my own life under "it's none of my business".
It's perfectly reasonable to say that it's none of my business and that I'm being petty here, I totally get that.
Does it have an effect on my life directly? No.
Does it have an effect indirectly? Possibly.

Imagine you want to sell your house and all the comparables of the last 3 years were removed from existence, how are you going to justify 2017 prices where all you have is 2014 compareables?
The whole real estate market is a domino, if you're missing some pieces it may or may not have an effect on the next piece.

When I sold my previous place, I shattered the previous record by about 300k which was about 30%.
As soon as people saw that, you had 5-7 similar houses going on sale using my sale as a benchmark to justify their house worth.
I think it's perfectly logical for me to enjoy the same benefit as others have enjoyed it when I sold mine.
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Sep 8, 2007
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Way Out of GTA
What if you bought at a higher price and they sold well under what you paid? You gonna be happy with that news?

Why is it some kind of slight that you don't know what they sold it for? Why is it your right to know? Worry about your own life.
"It is in times of great fear or greed that the most opportunity exists."
Sr. Member
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Oct 19, 2016
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To answer your question, Yes you are being petty.
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Jun 8, 2008
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Why do you think the realtor didn't get their commission? Just because your realtor can't find a sold record? I'm a little lost.

Given you just moved into the area, unless you're planning on selling again soon, I wouldn't worry about this in the least.
[OP]
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Oct 29, 2010
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mrtrump wrote: To answer your question, Yes you are being petty.
Fair enough, thanks.
wirebound wrote: Why do you think the realtor didn't get their commission? Just because your realtor can't find a sold record? I'm a little lost.

Given you just moved into the area, unless you're planning on selling again soon, I wouldn't worry about this in the least.
I'm sure the realtor got his commission, but it's kinda like paying cash and the realtor being able to save on tax and in turn give some discount back to the buyer/seller.
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Mar 14, 2006
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wait 3-4 months(time to close) and you can find out if new names have been assigned to title of the property. a resourceful realtor can find that out.
if it's true that the realtor got paid under the table then his/her brokerage can also sue him, that's a big assumption to make.

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