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Comparables

The longer it takes to learn about the difference in a house’s asking price and the sold price of comparables, the more likely one is to develop preferences with incomplete information. This is not to suggest that consumers are incapable of revising their preferences when more information becomes available at a later stage. Nevertheless, we contend that consumers are more likely to make informed choices at the very beginning of a search conducted with full information as opposed to at even later stages of one in which information is released over time, or with restrictions on the way it is disseminated.

The case for keeping the sales price data out of the public’s direct reach is often made for privacy reasons. It has been argued that buyers and sellers would prefer sold prices to be kept offline. This is nothing more than a red herring.

Housing sales details, including the sold price, are a matter of public record and are available, albeit not readily, from municipal and other registries. To argue that sold price should only be revealed to customers by a real estate agent is akin to arguing that a legal verdict should only be shared via lawyers because of confidentiality reasons. But that’s not the case. One can readily access case history in Canada online with financial details of the litigants.

Sales data

Equally relevant to the debate is the fate of pending sales data. Before a sale closes (and is officially registered by the authorities), it stays in a real estate purgatory often for a time varying between less than a week to many months. This implies that while a sale has been contracted, it hasn’t closed. For the timeliness of data, the pending sales price is the most relevant piece of information for future and impending sales and consumer decision-making.