Real Estate Talks

Kootenay, this approach is naive and you'll never sell anything for the reasons I pointed out.

.... Kootenay's idea is no more silly than having taxi drivers "sell" real estate.

Also, a "commodity" condo to you may be a palace to someone else. I think realtors get paid to "care", and in so doing they are in a better position to help a Buyer make the best purchase at the time.

If they don't get paid, why would they get up and even bother to act on behalf of a buyer or seller?

The next time i try and list my property in the spring i will insist that the buyers real estate agent will NOT IN ANY WAY know what the commission will be.

That sounds like advertising a temporary job and telling applicants that you will not give them any indication of how much you will pay them until the work is complete. Yeah, that should work.

Whippy wrote:

Kootenay's idea is no more silly than having taxi drivers "sell" real estate.

My taxi driver did a great job on my rectal surgery, but he was trained as a dentist in Uganda so he knew what he was doing. I'm not sure I'd use him as a realtor though.

It sounds like you will call a roofer in , have him put the roof on and then ask how much do I owe for the roof

Kootenay, this approach is naive and you'll never sell anything for the reasons I pointed out.

.... Kootenay's idea is no more silly than having taxi drivers "sell" real estate.
[/quote]

Why is that a silly idea? That's all some buyer agents are, glorified taxi service.

Also, a "commodity" condo to you may be a palace to someone else. I think realtors get paid to "care", and in so doing they are in a better position to help a Buyer make the best purchase at the time.

I said commodity condos at 200K or so. Do the math on the commission, and it works out to be a big % of the sale versus something that's 500K or so. If you're only making, say $20 an hour or something and you have a knack / interest in selling real estate, you might want to do it yourself.

On a 500K, the effective % is smaller and probably a good seller agent will get your more than they're paid.

Yes Austin, I get it....it costs "relatively " more to sell a basic starter type unit than an expensive one. However the legal implications are the same whether the suite is tiny or it's a palace therefore to look at it as a per dollar cost may not be all that p.r.u.d.e.n.t.

(You know...."penny wise but pound foolish")

You guys are good at that.

Yes Austin, I get it....it costs "relatively " more to sell a basic starter type unit than an expensive one. However the legal implications are the same whether the suite is tiny or it's a palace therefore to look at it as a per dollar cost may not be all that p.r.u.d.e.n.t.

(You know...."penny wise but pound foolish")

You guys are good at that.

Pennies might not mean a lot to you, but to someone who's making minimum wage and living in a small condo, that's a lot of money.

About 10 or so, I'd say. Not one of them told me up front they don't show listings with zero buyer agent commissions (e.g. FSBOs) and that I'd have to pay the commission for those if I wanted to see them.

Anyways - so say it loud ThinkTom, so I can quote you to everyone I know.

Do the majority of Buy Agents ignore the commission fee listed for the properties or not?

Now - If they don't ignore it, do they spell it out *CLEARLY* to their clients before hand that they will only show properties with full buyer agent commission?

Somehow I really really doubt you're going to answer that question unequivocally.

I'm imagining right now, something like, 'oh I don't know what other realtors do...'

1. Settle down. Obviously I don't know what the 10,000 agents in this town do. Nice try. Your powers of perception are brilliant though. Well done.

2. I've been on these boards 6 yrs and have said pretty much all I'm going to say about 'commissions', 'realtor bashing', yada, yada.. It's a very old and stale argument. So is 'The Bubble'. Don't like realtors, don't use them.

3. "Do the majority of Buy Agents ignore the commission fee listed for the properties or not?"- Well, it's on our MLS system for a reason. Yes, we would like to know how much we might get paid if we bring a qualified purchaser to that property. I bet you like to get paid for working... unless you're a Missionary? (They get living wages I believe regardless).

4. Many probably spell out that they won't show FSBO's. I don't but I don't blame them one bit. I do inform my clients of these exact scenarios. I have put together probably more than 5 but less than 10 of those deals together. That's about
as 'unequivocally' as you're going to get. Deal with it. I'm out.

Tom

It sounds like you will call a roofer in , have him put the roof on and then ask how much do I owe for the roof

We appear to be on the same page with this, except I think it's even worse. It's like asking the gut to replace your roof on the understanding that you won't tell him how much you are paying until the job is finished. Who in his right mind will take that job?

If using a realtor was mandatory it would be an issue but it's a reasonably free market, you can see what they want to charge and you can use them or not, nobody is forced to use their services. From my experience using a good realtor has paid off. Keep in mind that if they don't get the offer you mandated in the agreement you can always suggest that they reduce their commission if they want you to accept a lower offer or you can reject the offer.

I find it really amazing that Realtors will not take a buyer to a house that is FSBO listed just because they are not going to get a $5,000.00 commission on a deal even though the seller would be suddenly looking to buy his/her next home and therefore a commission lost as whom do you think the seller would want to use for help. In my own personal experience this year when i tried selling my own home i found out that realtors did not want to even show my home because i negotiated the commission way down. I even did a lot of my own advertising as putting a listing on the Realtor.ca website and just waiting to get the call from a buyer is not that much work for the astronomical commission rate. As for the agent selling the house a half the offered commission rate is pretty good for one afternoons work taking a buyer to a listing and showing the home then drawing up an offer. Works out to be over $500.00 per hour. What does everyone else think

Unless you give full commission or close to full commission for the buying agent, don't expect the realtor to bring clients in.

When i did my FSBO ad i said i was willing to negotiate the commission to a realtor. Then when i did list the property with a realtor was when nobody wanted to show the property as the commission was negotiated down . I listed below the assessment value so the price was not way out of the market i was at $100,000 below the next listing of $415,000 for a newer home just up the road. I am still going to try and sell again in the spring but the market in the beautiful Kootenays seems to be very slow.

$100k below the next listing of $415k? wouldn't you be better off hiring a realtor and offering full commission? You will be better off than just reducing it by $100k. Well, the $100k off next listing is different than the last SOLD price.

Only the Seller is allowed to be greedy, and then complain when his/her house doesn't sell.

This. Give me a break. I have shown plenty of FSBO's to clients. It's also not surprising how many FSBO's are overpriced. Lofty expectations is the culprit.

Let's face it. It's also about ego. Some people don't think the Realtor is worth the commission. Fine. Don't pay it. But I find it hilarious when I tell a FSBO I'll 'net' them their price and tack my commission on top, and they still refuse. Why? EGO.

Work with a buyer for a year or two, with all that it entails, and then not be compensated when they finally buy?? Sure. No problem.

FWIW, after briefly toying with the idea of FSBO I used a realtor for my last sale and it paid off handsomely. I thought I had a good understanding of using comparables to determine a price that would be near the top of the range I should be in yet still ensure a reasonably prompt sale.

Fortunately the realtor persuaded me to price it a lot higher, he brought well qualified traffic to the property and quickly sold it for substantially more than I expected. He saved me from my own ego and my flawed valuation. The additional money paid his standard commission in full (no grinding) and left me tens of thousands ahead, that was the best earned commission cheque I ever wrote.

Who said all realtors are bad? There are good ones, just have to find them or through referrals.

A bad one would probably pay you what you want and flip it at a higher price and pocket your gain.

This is also a fundamental problem with buyer agents. There is a confusion about who they work for.

Not all buyer agents want to nickel and dime on price, from what I've seen the "good" ones are almost silent on price except producing data to show what comparables are selling for. If you don't like the comparable prices you shouldn't be buying. Expectations go both ways.

My family Realtor friend told me well over half his business can be traced to referrals. There is a huge incentive for the Realtor to make his clients happy with their purchases or risk loss of future business.

I don't know why you're hung up on Realtor incentives. The problem is easily solved by finding a good Realtor. I'm sure Tom can recommend a few.

Yes, we would like to know how much we might get paid if we bring a qualified purchaser to that property. I bet you like to get paid for working..

Yeah, but unlike most realtors, I am very very clear up front (before I engage) with people what they're going to get and what they pay for, even if its bad news they don't want to hear. I don't leverage some monopolistic position to keep out competitors and even recommend when I can, services or offerings better than my own (often with the suggestion I manage the process).

Of course, I develop SOW contracts detailing what I will do and what I will get paid hourly, so I don't have to worry about losing out if they chose to go with someone else.

I've been on these boards 6 yrs and have said pretty much all I'm going to say about 'commissions', 'realtor bashing', yada, yada.. It's a very old and stale argument. So is 'The Bubble'. Don't like realtors, don't use them.

I will say most realtors aren't particularly good. There are a few which are very good and worth hiring. Unfortunately, *all* realtors are stuck working in a structure which is anti-competitive which in my opinion is immoral.

My family Realtor friend told me well over half his business can be traced to referrals. There is a huge incentive for the Realtor to make his clients happy with their purchases or risk loss of future business.

Yes, and the reason is because FSBOs / low commissions aren't a big part of the market because there is a monopolistic agency in force which keeps out competition. That's why we're stuck with realtor made website and no competitive services. In the US there is a lot of competition and innovative ideas going on. Not so in Canada.

My problem with finding a "good real estate " agent is that i live in SMALL TOWN BC. not in the bubble of Vancouver. Prices here do NOT fluctuate $50,000- $100,000 on a given property. I was asking a price that was $10,000 below the assessment value. So if your car is worth $20,000 would you sell it for half it is worth NOT likely. My neighbours home sold for $415,000 it is a newer home and bigger. My home sits on 1/2 acre 3 bed i bath built in the 70's . Priced under $300,000 in a quiet area outside of town.
My idea of NOT disclosing the commission is only because here realtors look at their compensation then decide if they will show the house if they won't make a quick 10 grand for showing and selling the house it would seem they do not want to bother.
By not having the commission disclosed they would find out after they get a offer. Also the commission on my property would be around $12,000 for a full commission i make less than that for a year as i work part time seasonal work. So it is a huge amount of money .

I had my property listed with two real estate agents and twice absolutely NO showings . I listed as FSBO and had 6 showings by internet sites like Kijiji, craigslist and used everywhere. so it is not a matter of the commission.