To realtor up or not...

[jeffh]

Hello CP,

This may be better suited for realtor thread, but better traffic here.

I am requesting some real estate advice.

I am looking at purchasing a brand new home(having it built). The homebuilder said that if I use their realtor to sell my current home(asking about $380k), I won't have to pay my realtor to sell, just have pay the buyer's realtor. This will save me about $7500 plus I get free staging. My new home will be about 500k. A similar spec home the builder has for sale has an asking price of 511k. The spec home did not appear to have any better extras other than a bigger pie lot. My question is, will it be worth it in the long run to get my own realtor to sell my current home and negotiate a better purchasing price for my new home?

[GP_Matt]

Originally Posted by jeffh

Hello CP,

This may be better suited for realtor thread, but better traffic here.

I am requesting some real estate advice.

I am looking at purchasing a brand new home(having it built). The homebuilder said that if I use their realtor to sell my current home(asking about $380k), I won't have to pay my realtor to sell, just have pay the buyer's realtor. This will save me about $7500 plus I get free staging. My new home will be about 500k. A similar spec home the builder has for sale has an asking price of 511k. The spec home did not appear to have any better extras other than a bigger pie lot. My question is, will it be worth it in the long run to get my own realtor to sell my current home and negotiate a better purchasing price for my new home?

I don't think they will let you use your builder to negotiate on the new home if you have spoken to them in advance without one.

[ken0042]

That is true- the builders are pretty strict on that rule. They are paying realtors to bring them in customers, and if you have already represented yourself they don't want to give away a commission for nothing.

Having said that- there is no harm in trying. I would also strongly recommend PMing Realtor 1
Travis has been working with me on building a new home and selling my current one. I am just waiting for a couple of things to finalize before posting a review, however he has certainly saved me more money that I am paying him in fees; not to mention stress and peace of mind.

[undercoverbrother]

Originally Posted by ken0042

Travis has been working with me on building a new home .

Not in Airdrie I hope!!!

[Calgary14]

We built a new home almost two years ago and were in a similar situation except we kept our old place as a rental. Our builder told us we'd have more room for negotiating on the price if we didn't use a realtor (to represent us on the new build). It paid off, we saved thousands and just dealt directly with the builder.

In your case you'd need to figure out if the commission savings from selling your current place (using their realtor) would be higher than the savings off the purchase price of the new build you'd get for not using a realtor

[2ArmBands]

Originally Posted by jeffh

Hello CP,

This may be better suited for realtor thread, but better traffic here.

I am requesting some real estate advice.

I am looking at purchasing a brand new home(having it built). The homebuilder said that if I use their realtor to sell my current home(asking about $380k), I won't have to pay my realtor to sell, just have pay the buyer's realtor. This will save me about $7500 plus I get free staging. My new home will be about 500k. A similar spec home the builder has for sale has an asking price of 511k. The spec home did not appear to have any better extras other than a bigger pie lot. My question is, will it be worth it in the long run to get my own realtor to sell my current home and negotiate a better purchasing price for my new home?

Also... I see it being highly unlikely that they will negotiate a better price on the spec home. The way the market is right now you'd be lucky that they don't jack up their prices across the board in the coming days even! I just did a sell and purchase with a large home builder realtor so feel free to PM me ...
Might be the same builder and I can weigh in on their realtor. I did do the opposite of you though I sold my new build 2.5 year old home and bought a much older house.

I will add that despite not doing any business with Travis (Realtor1) I have heard nothing but good things.

[#-3]

I've only hire 2 realtors, but my from what I have seen in a hot market like Calgary,

When selling they help but they do not earn their money. I think on my last house if I am vary generous about the amount of time, the sellers agent made about $400/hour. And he gave me a $2000 discount on his services. Even with all their excusses of fees, advertising, customer acquisition cost...... Lawyers after 8 years of schooling charge about 1/2 with all of their overhead and expenses included. High specialized trades people with 4 years of schooling make 1/4 of that. Something is out of whack with that structure, for guys with 6 months of education.

When I purchased houses, I felt like it was closer to $100/hour. Which still seems high but not crazy, but I did not find them particularly helpful. The only real advantage they provided was the MLS listing about a day in advance of them hitting the internet.

[jeffh]

2armbands, I was referring to the spec home for price comparison only. The realtor is JamesHomes, same one?


Also, thanks for the replies everyone.

[MillerTime GFG]

Originally Posted by #-3

I've only hire 2 realtors, but my from what I have seen in a hot market like Calgary,

When selling they help but they do not earn their money. I think on my last house if I am vary generous about the amount of time, the sellers agent made about $400/hour. And he gave me a $2000 discount on his services. Even with all their excusses of fees, advertising, customer acquisition cost...... Lawyers after 8 years of schooling charge about 1/2 with all of their overhead and expenses included. High specialized trades people with 4 years of schooling make 1/4 of that. Something is out of whack with that structure, for guys with 6 months of education.

When I purchased houses, I felt like it was closer to $100/hour. Which still seems high but not crazy, but I did not find them particularly helpful. The only real advantage they provided was the MLS listing about a day in advance of them hitting the internet.

You can't look at it that way for realtors. Sure, for actual work per deal it may seem like they're overpaid, but what you don't see, is how much work they have to do to get clients in the first place. You don't just become a realtor one day, and the next day business is booming.

If realtors were paid by the hour, they'd all be broke, or there would be about 10 of them servicing the whole city. If it's so easy, perhaps you should quit your day job, do the 6 month course and you'll be rich within weeks! Realtors are important, don't discount that fact.

[Dan02]

Originally Posted by #-3

I've only hire 2 realtors, but my from what I have seen in a hot market like Calgary,

When selling they help but they do not earn their money. I think on my last house if I am vary generous about the amount of time, the sellers agent made about $400/hour. And he gave me a $2000 discount on his services. Even with all their excusses of fees, advertising, customer acquisition cost...... Lawyers after 8 years of schooling charge about 1/2 with all of their overhead and expenses included. High specialized trades people with 4 years of schooling make 1/4 of that. Something is out of whack with that structure, for guys with 6 months of education.

When I purchased houses, I felt like it was closer to $100/hour. Which still seems high but not crazy, but I did not find them particularly helpful. The only real advantage they provided was the MLS listing about a day in advance of them hitting the internet.

Spoken as someone who has never run their own business i take it?

[#-3]

Originally Posted by Dan02

Spoken as someone who has never run their own business i take it?

I have a great deal of experience with business, in both small businesses ~25 employees that my family owns, and multinational corporations.

#1 thing as a customer, its not my problem that there are too many realtors to go around, and it will be expensive for them to bring in their next customer. That is not acceptable in any other industry. Reverse pricing models are important to any other good or service how come when you bring it up with realtors you suddenly don't understand their plight.

#2, I have only bought two houses, both times working with a realtor. And I truly felt only advantage I gained from them was advanced access to the public mls listings early.

If you are really committed to it is not vary hard to get a vary good idea of what properties are worth, from city assessments, comparable listings, mortgage brokers and lawyers you will likely be hiring anyways. And in reality when you decide on a house your wide wants the value is what the seller is willing to take for it.

Disclosure are not something realtors only know despite the commercials. They are a matter of law, and if you ask the questions you have the same amount protect a realtor would afford you.

and contrary to what they would have you think, the vast majority of us have just as much negotiation education and experience as they do.


All of that being said, I did feal when I sold my house my realtor made it an easier process. I just felt $400 an hour was a bit much for the service, even when i considered how hard life must be for a realtor. Is he getting all of the money, or is the brokerage and realty board ripping him off? I don't know I just know I paid too much for the amount of service I received when I look at other industries.

[calgarywinning]

I've seen so many people that are not savvy at all lose big $$ by not consulting a very good realtor in listing or representing the property from both the buy and the sell. This far outweighs potential commission payments. The idea is the realtor is to get you the very best deal possible in the marketplace and whether it's a gain or a loss, the amount garnered by their skill should far outweigh the comission.

The fact that you can lay brick, learn about laying brick and become a damn good bricklayer outlay the fact that a realtor is laying brick every day, and there happen to be some exceptional bricklayers out there. Also, you may not want to have your days run by laying brick, home showings, etc...

[#-3]

/\
That kinda sounds like the mafia. Let me rip you off a little, so that I can make sure nobody rips you off.

Look i'm not blaming the realtors, I don't think they are knowingly conning every customer.
They go and pay half of the commission to someone who provided vary little service to them. But as a consumer I am still upset the industry takes too much money from the consumers for the amount of work being done. I don't care if they are supporting more jobs than are needed, or if one guy is making millions off our backs. Its too much either way.

When I hire a brick layer, I pay $100 an hour, to show up with a Van and Tools. They don't charge me for the gas, or the people in the office, or to put then next guy through brick laying school. And by the way a stonemason probably has about 6x the training of a realtor for his job.

Maybe there are just too many realtors or the barriers for entry into the industry are just to low, or there is too much being put into the real estate board. But at the end of the day, consumers are paying for more than the service they are receiving. And that is not fair to the consumer.

[Dan02]

If you aren't happy with the price your realtor charged there are other options, rhino realty, sellerdirect, welist etc.

[AMG_G]

Originally Posted by Dan02

If you aren't happy with the price your realtor charged there are other options, rhino realty, sellerdirect, welist etc.

Speaking of Welist, I bought a half duplex off of this couple for $174k in 2005 that got appraised at $225k by my bank. Realtors have their value especially for those who don't do their due diligence.

[Handsome B. Wonderful]

Originally Posted by AMG_G

Speaking of Welist, I bought a half duplex off of this couple for $174k in 2005 that got appraised at $225k by my bank. Realtors have their value especially for those who don't do their due diligence.

How can a realtor have value there? You just told us a bank can appraise the house.

[MillerTime GFG]

Originally Posted by #-3

I have a great deal of experience with business, in both small businesses ~25 employees that my family owns, and multinational corporations.

#1 thing as a customer, its not my problem that there are too many realtors to go around, and it will be expensive for them to bring in their next customer. That is not acceptable in any other industry. Reverse pricing models are important to any other good or service how come when you bring it up with realtors you suddenly don't understand their plight.

There are currently close to 4500 listings in Calgary, and over 2000 homes have been sold within the last 30 days in Calgary. Sure, there might be a few too many realtors, but would you rather 10 realtors servicing that many listings? The more realtors, the better the service. The competitiveness of that industry is a good thing.

[MillerTime GFG]

Originally Posted by Handsome B. Wonderful

How can a realtor have value there? You just told us a bank can appraise the house.

A realtor certainly would have had 10's of thousands of dollars value for the seller at least, that's for sure!

[1stLand]

Originally Posted by Dan02

If you aren't happy with the price your realtor charged there are other options, rhino realty, sellerdirect, welist etc.

List of Discount Brokerages Operating in this City:
- 1 Percent Realty
- 2 Percent Realty
- Rhino Realty
- Seller Direct
- Rock Realty
- Cameron Realty
- We List (now offers Full Service I believe).

[troutman]

Lawyers charge 1/2?