To realtor up or not...

[MillerTime GFG]

Rhino Law Services.

[Table 5]

If you're buying, it would be silly not to use a realtor since you don't get charged anything. However, having just bought a house, I kind of feel like I got what I paid for.

All our realtor basically did was hook us up to his MLS email service. We were the ones who scoured everything, we were the ones going to open houses, we were the ones who found the house we eventually bought. He never really checked in or offered any advice on neighborhoods/houses that wasn't stupidly obvious. When he showed us a house, he mostly stood there looking at his cell phone. The broker he recommended was completely incompetent, to the point where we almost lost the house...the only reason we didn't if finally tried someone else.

The selling agent was an even more useless boob. I don't know if it was just the agents we dealt with, but I would consider the service and value extremely low. Maybe they don't need to offer customer service in this market, but it sure would be nice. I can put up with some incompetence when Im buying, but as a seller, if I had to pay 20-30k (or whatever) for that level of service, I would not be a happy camper. By the end of the buying process, I feel like I knew 90% of what my realtor did....might as well take the realtor course for a few months, and go all the way.

Our real-estate lawyer (some sort of fish guy) on the other hand, was extremely professional!

[MillerTime GFG]

Did you use a discount realtor?

[Table 5]

Originally Posted by MillerTime GFG

Did you use a discount realtor?

If this is asking me, then no, a regular realtor with multi-year experience. I'm not saying there was any incompetence, but I guess I just expected a little more customer service and effort beyond the bare minimum. He seems to get a lot work, so I guess there isn't much incentive right now for a lot of realtors.

[Mr.Coffee]

Our realtor when we bought, could not have been more useless / slimy. I feel like the welcome gift she gave us for our new place should have been a new car.

"Offer list price"- in a market that wasn't really all that hot... so then I ignore her advice offer well below list price and sure enough the seller comes down significantly. Meanwhile her firm was also the seller....................................nothing fishy there.....

All after acting like we were wasting her time and only looked at 5 places. Man just thinking about it makes me angry... and I've had almost even worse luck with mortgage brokers. Just a clusterf.

[Canehdianman]

Originally Posted by troutman

Lawyers charge 1/2?

Haha no kidding. More like 1/20th (once you remove disbursements)

Anyways, I bought my house without a realtor. I just deducted s standard realtor fee from my offer. Worked out great.

The largest fallacy that realtors tell their clients is that they are working to get them the best deal they can. While I am sure that there are great realtors out there, their motivation is to get you do buy/sell quickly so they can move on to another client.

The pricing structure for realtors needs to change to something that more closely ties effort and time together with cost.

I can tell you that if I got paid a flat rate for each transaction I negotiated and papered I would certainly be incentivized to speed up negotiations as much as possible. But that would be contrary to my clients interests, so its best to stick with an hourly amount to tie the work and the compensation together.

[#-3]

Originally Posted by troutman

Lawyers charge 1/2?

On a per hour basis. Last year, I moved and I was curious because the pricing model of the industry always seemed out of whack to me, so I paid allot attention to the kind of time my realtor, lawyer, and mortgage agent were putting in.

I figured the Realtor made ~$400/hour on the sale. *with a $2000 discount on his commission.
I only included the half that he received, I consider the buyers agents fee to be paid buy the buyer. Because that is where the money is really coming from, and I find the way they traditionally describe the relationship vary unethical.

On the Purchase with no discount, i think he made ~$200/hour.

The Lawyers on both transactions provided a detailed list of tasks preformed. I think it would have worked out to about $175/hour (or half of what the realtor charged)
I'm sure most of the time was a paralegal. but there expertise is probably as high as a realtor.

I did not use a mortgage broker this time, I worked directly with my previous bank. And I think for the work they put in I paid them ~$15/hour in Admin fees. But they will get their money in other ways.

I personally feel by comparing it to other services, both trades and professional, including advertising, marketing, overhead, association fees it would be reasonable to charge between $90 and $150 /hour. The rest of that money is going somewhere that is not in the customers best interest. Weather its the Realtor, or the Brokerage, or the Board?

It was an interesting experience putting that amount of effort into seeing where the money went. I do think discount brokerages are a good idea for most, they are doing what they can to address issues that are systemic in the industry.

[Travis Munroe]

[#-3]

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.

Maybe they sold it for $10k-$15K less because they used We-list, and they were never going to get that money anyway. So you were much better off and he was no worse off.

And in 2005 Calgary houses were regularly going up 10's of thousands of dollars, in short periods of time. My $250K house i was in 1999 was worth over $500K by 2007.

[#-3]

Originally Posted by Realtor 1

And i am sorry Travis i don't want these statements to come off as personal attacks. I know many of you work vary hard, i'm just not certain the customers gain as much from the transaction as the real estate industry does. And that just seems unfair too me.

[Handsome B. Wonderful]

Originally Posted by Canehdianman

The largest fallacy that realtors tell their clients is that they are working to get them the best deal they can. While I am sure that there are great realtors out there, their motivation is to get you do buy/sell quickly so they can move on to another client.

It goes beyond that. If you're buying, what is the realtors motivation to get you the best deal possible? The more you pay, the more they make.

[Travis Munroe]

Originally Posted by #-3

Maybe they sold it for $10k-$15K less because they used We-list, and they were never going to get that money anyway. So you were much better off and he was no worse off.

And in 2005 Calgary houses were regularly going up 10's of thousands of dollars, in short periods of time. My $250K house i was in 1999 was worth over $500K by 2007.

Then they missed out on a opportunity to write off real estate commissions

[GP_Matt]

I think the biggest problem is that there are some part-time realtors and some terrible realtors. I would imagine that most are quite good at their job and provide value but there is a small percentage that give the industry a bad reputation. In a slow market the poor realtors are weeded out but in a hot market they can eke out a living and more show up.

The first realtor we used took us to a grand total of three houses which were all 30% lower than the bottom of our price range. She told us that we should make an offer to prove to her that we were serious. She said that we could make the offer subject to financing and then back out. We left her and found a much better realtor the next day who worked with us and found a great house.

[AMG_G]

Originally Posted by Handsome B. Wonderful

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

If they used a realtor they wouldn't have priced the house $50k below market.

[Travis Munroe]

Originally Posted by GP_Matt

I think the biggest problem is that there are some part-time realtors and some terrible realtors. I would imagine that most are quite good at their job and provide value but there is a small percentage that give the industry a bad reputation. In a slow market the poor realtors are weeded out but in a hot market they can eke out a living and more show up.

The first realtor we used took us to a grand total of three houses which were all 30% lower than the bottom of our price range. She told us that we should make an offer to prove to her that we were serious. She said that we could make the offer subject to financing and then back out. We left her and found a much better realtor the next day who worked with us and found a great house.

5000 of us within Calgary and area.
The famous saying 90/10 is especially true in the real estate industry. 90% of the money is controlled by 10% of the realtors. While the industry could do something to weed a ton of the bad apples out, they make money off it. The public has the opportunity to find the agent they want.
Some types of agents I have come across that I can see leaving a bad taste in their clients mouth.
- The part time realtor
- The think im going to get rich overnight realtor
- The every house we visit is the perfect house for you realtor
- The let me sell your house and spend as little money marketing as possible realtor

Ill leave you with a listing I found earlier

Outstanding open plan,South facing happi apartmen,good #of cabinets and brekfast bar.Her and His walk through closets ,seperate landry,with plenty of open please,sizeble balcony for Your entertainment. 2 heated parking ,and a storage on main floor.Titled.Wort more then 20%of apartment cost?

http://tmunroe.com/mls-C3608982-Unit...y_Alberta.html

[krazycanuck]

I work with a builder, and one of the first posts is right. Once you've come in a sales centre on your own, you can't use a realtor for the purchase. In fact, if a realtor agrees to work on your behalf now, they are putting their own licence at risk as it is punishable by the real estate board.

I would suggest that you actually have more leveraging power without a realtor to negotiate the price on a new home. Most builders will pay 3.5% of the first $100,000 and 1.5% on the remaining amount to a realtor. That's almost $10,000 on a $500,000 home. That money either comes from the profit of the home, or in some cases part of the sales person's commission. While the rule is they won't markup the home if you use a realtor, they also will factor in that they are probably losing $7,000 to $10,000 in their profit margins, and will be less likely to want to lose anymore by negotiating down in price.

[Travis Munroe]

Originally Posted by krazycanuck

I work with a builder, and one of the first posts is right. Once you've come in a sales centre on your own, you can't use a realtor for the purchase. In fact, if a realtor agrees to work on your behalf now, they are putting their own licence at risk as it is punishable by the real estate board.

I would suggest that you actually have more leveraging power without a realtor to negotiate the price on a new home. Most builders will pay 3.5% of the first $100,000 and 1.5% on the remaining amount to a realtor. That's almost $10,000 on a $500,000 home. That money either comes from the profit of the home, or in some cases part of the sales person's commission. While the rule is they won't markup the home if you use a realtor, they also will factor in that they are probably losing $7,000 to $10,000 in their profit margins, and will be less likely to want to lose anymore by negotiating down in price.

Interesting statement

1- Most builders do not pay 3.5/1.5 on a brand new build.
2- I would like to know (pm if you wish) which builder it is that you work with so that I can confirm with someone that there is more room to negotiate without a realtor. Its been my understanding through countless new builds that builders know X% of people will come in with their realtor and these funds are in a different account. 100% non reflective of your purchase price, the houses profit margins, etc. In fact, many supervisors have told me that they like when a realtor brings a client in and is paid as they build a bond and often see that realtor back in with a new client who asked for some help.

I do not mean to call you out and I know thats how it came across however your comment bothered me in that you are coming from the industry but had many incorrect points. Even IF, (this if is 0% but anyway), IF a buyer received some sort of discount for not being with a realtor, a buyer would have to figure out if the discount was equal to having someone in their corner who could save them from being drawn into multiple upgrades that have no re sale value of the house & if it was your first time, the feeling of having nobody in your corner as you sign 100+ pieces of paper!

[Hockeyguy15]

Originally Posted by Realtor 1

5000 of us within Calgary and area.
The famous saying 90/10 is especially true in the real estate industry. 90% of the money is controlled by 10% of the realtors. While the industry could do something to weed a ton of the bad apples out, they make money off it. The public has the opportunity to find the agent they want.
Some types of agents I have come across that I can see leaving a bad taste in their clients mouth.
- The part time realtor
- The think im going to get rich overnight realtor
- The every house we visit is the perfect house for you realtor
- The let me sell your house and spend as little money marketing as possible realtor

Ill leave you with a listing I found earlier

Outstanding open plan,South facing happi apartmen,good #of cabinets and brekfast bar.Her and His walk through closets ,seperate landry,with plenty of open please,sizeble balcony for Your entertainment. 2 heated parking ,and a storage on main floor.Titled.Wort more then 20%of apartment cost?

http://tmunroe.com/mls-C3608982-Unit...y_Alberta.html

You forgot to include the realtors that let their clients piss all over the toilet and floor. That really GMG.

[Thor]

Well people say there is a lot of motivation for a realtor to sell for more to make more themselves but really that's not quite true.

My realtor was happy to sell at 410 instead of 430 where we started, the difference he makes after the sale between that 20k is really tiny for him, but huge for me. Saying that however, my realtor was awesome and did everything else 100%.

[GP_Matt]

Originally Posted by Realtor 1

5000 of us within Calgary and area.
The famous saying 90/10 is especially true in the real estate industry. 90% of the money is controlled by 10% of the realtors. While the industry could do something to weed a ton of the bad apples out, they make money off it. The public has the opportunity to find the agent they want.
Some types of agents I have come across that I can see leaving a bad taste in their clients mouth.
- The part time realtor
- The think im going to get rich overnight realtor
- The every house we visit is the perfect house for you realtor
- The let me sell your house and spend as little money marketing as possible realtor

Ill leave you with a listing I found earlier

Outstanding open plan,South facing happi apartmen,good #of cabinets and brekfast bar.Her and His walk through closets ,seperate landry,with plenty of open please,sizeble balcony for Your entertainment. 2 heated parking ,and a storage on main floor.Titled.Wort more then 20%of apartment cost?

http://tmunroe.com/mls-C3608982-Unit...y_Alberta.html

That link makes it look like you are the realtor who wrote the listing.
Tell me it isn't so.