and there is only one person who signs a contract, the seller, and they pay both agents.
Often true, but there is a contract between buyers and their agents which some choose to enter into.
Not all agents use it, but it does exist and some agents won't work with any buyers who don't sign it. Just wanted to clarify that.
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As in all sales situations, the weaker person will get screwed and I have yet to see or hear a real estate agent tell a client to walk away from a property ever, in fact having done a modicum of sales myself most of what an agent does is pretty much the same as what any salesman does, work out what you want, find a close apprixamation and then apply gentle or not so gentle preasure to get you to agree to a deal.
Speaking for myself and every decent agent I know, we tell buyers to walk away from places all the time.
Why I would I want my client buying something that they will regret or give them issues later?
For one, I have a conscience and actually care about my clients.
But secondly, even if I was the greedy self serving Realtor stereotype, repeat business and referrals and the largest source of a Realtor's clientele. You won't last long if you're working as part of the "screw".
I don't know your personal experiences, but can't imagine the agents you've worked with have lasted long if you're being accurate.
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There is nothing wrong with any of this but people have to realise real estate agents are no more on your side than the 'financial consultant' at the bank or the guy flogging cars at the ford dealership, all of them want you to be happy with what they sell you, none of them are looking to rip you off per say but they are all concerned solely with making a sale, that is their job.
Both examples you've listed are only wanting you to do business with them. The guy at Ford isn't gonna tell you if the Nissan across the street is a better purchase.
A buyers agent doesn't have allegiance to a particular property, developer or listing agency so it's a completely different situation. Their allegiance, both in practicality and fiduciary duty is to the buyer.
Of course we want a transaction to eventually happen, that's how we make a living. But the buyer is looking at properties because they also want a transaction to eventually happen, so it's a mutual goal.
If they change their mind and decide to hold off for a while, that's where some agents gain their bad reps. I'll give you that point.
A smart agent with integrity wants your business back when the time is right for you and won't burn that bridge.
In fact, your examples of the financial consultant and Ford salesman are a perfect example of why the OP likely should use their agent. Those are good parallels to the salesperson who has told them not to.
A little bit like the Ford guy telling you not to inspect the car, it will cost you more.
Just like that sales person is gonna tell them if there's a better home builder a block away with a better reputation, better deals, long term resale value and history of great customer service.
Last edited by Winsor_Pilates; 11-26-2012 at 10:17 PM.
Often true, but there is a contract between buyers and their agents which some choose to enter into.
Not all agents use it, but it does exist and some agents won't work with any buyers who don't sign it. Just wanted to clarify that.
Speaking for myself and every decent agent I know, we tell buyers to walk away from places all the time.
Why I would I want my client buying something that they will regret or give them issues later?
For one, I have a conscience and actually care about my clients.
But secondly, even if I was the greedy self serving Realtor stereotype, repeat business and referrals and the largest source of a Realtor's clientele. You won't last long if you're working as part of the "screw".
I don't know your personal experiences, but can't imagine the agents you've worked with have lasted long if you're being accurate.
Both examples you've listed are only wanting you to do business with them. The guy at Ford isn't gonna tell you if the Nissan across the street is a better purchase. A buyers agent doesn't have allegiance to a particular property, developer of listing agency so it's a completely different situation. Of course we want a transaction to eventually happen, that's how we make a living. But the buyer is looking at properties because they also want a transaction to eventually happen, so it's a mutual goal.
In fact, your examples of the financial consultant and Ford salesman are a perfect example of why the OP likely should use their agent. Those are good parallels to the salesperson who has told them not to.
A little bit like the Ford guy telling you not to inspect the car, it will cost you more.
I would argue that once a buyer has found a house they like, seen it a couple of times, the wife has gushed about how well the china cabinet will go in that corner or the like, at that point both agents have a mutual goal to get the buyer to buy the house, it is not in the buyers 'agent' interest to endlessly schlep around town looking at houses with them, he/she is likely only doing the buying side because it got them a listing in the first place, as both you and I know it is all about listings in Vancouver, nothing more, helping people buy houses is seen as a neccersary evil and often the job of newcomers that dont have enough pull to avoid maning the desk at the office.
The Following User Says Thank You to afc wimbledon For This Useful Post:
I don't like using realtors in general because I don't think they're entitled to a percentage of the value of my home, which is loosely based on my net worth. I'll pay by the hour or a flat fee, but I have a big problem with the percentage-based system. I think this issue became particularly apparent when house prices shot up a few years ago.
Why not use a flat fee then?
There's no rule commission have to be percentage based, nor is there any standardized rates.
Location: Close enough to make a beer run during a TV timeout
Exp:
Quote:
Originally Posted by afc wimbledon
As in all sales situations, the weaker party will get screwed and I have yet to see or hear a real estate agent tell a client to walk away from a property ever, in fact having done a modicum of sales myself most of what an agent does is pretty much the same as what any salesman does, work out what you want, find a close approximation and then apply gentle or not so gentle preassure to get you to agree to a deal.
CP's own Travis (Realtor 1) showed me a property a couple of weeks ago; and did in fact tell me to walk away.
To me, this is one of the differences between a good realtor and a bad one. Having helped friends look at houses I have seen several bad realtors; and this is why I always tell people that they should interview realtors before hiring them.
Travis knows that by giving me honest and helpful advice, he is building a relationship, and that I am now extremely likely to use him going forward.
The Following User Says Thank You to ken0042 For This Useful Post:
CP's own Travis (Realtor 1) showed me a property a couple of weeks ago; and did in fact tell me to walk away.
To me, this is one of the differences between a good realtor and a bad one. Having helped friends look at houses I have seen several bad realtors; and this is why I always tell people that they should interview realtors before hiring them.
Travis knows that by giving me honest and helpful advice, he is building a relationship, and that I am now extremely likely to use him going forward.
Travis has done the same thing for me, actually a few times. He has done a lot of things for me over the last 2 years, and still has yet to make a dime.
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Well if the internet says it, it must be true. But I don't believe it because I'm biased. I'm from a family of realtors and land developers. Heck, I used to be licensed. And I learned a lot buying and selling homes for people. Most people have their own field of expertise, and I never knew more about their field than they did, and rarely did they know more about my field than I did. I can think of a few examples of times I beat up the price because of things that only people who dig deep are going to find out.
I am not saying realators are bad and neither does the study. The study states that once you decouple the value of the MLS service (essentially using an agent that will just provide the service of listing) the other services of a realator are over priced based on the economic value they add to the sale price of the home. This is from the sellers perspective rather than the buyers therefore doesn't take into account things like preventing a buyer from making a poor choice.
I think it is a misnomer to compare FSBO to a realtor when the real comparison is just using the listing service (no one disputes its value) and using a full service realator.
I think that using a realtor should be a choice rather than the default position. People should evaluate their needs and then decide. I think that the idea that realtors should be used is a myth and should be evaluated based on your needs and on case by case basis.
The freakonomics skit on real estate agents is a joke IMO.
- anyone who has worked with me or any other reputable real estate agent has a good chance of hearing "I think we can get more", "lets counter take it or leave it" etc...
- while I cant verify the stat on agents homes staying on the market longer and selling for slightly more I can say that it would make sense. Its what we do for a living so listing our own property on the market as a feeler when we may not even be looking to sell is quite simple vs doing it for a client. We know how a home needs to be presented for top dollar and although we pass this advice onto our clients, not everyone is able to do everything we suggest.
- The part where the agent says to take 290 now vs 300 next week is laughable. If only we all had a crystal ball that told us an offer was coming in next week for full price. How it should work and in most cases for clientele whom have worked with me, we list at whatever price the seller wants. I give my suggested price and also give what I believe will be the actual sale price.
It all boils down to do you need a realtor or not
If the answer is yes, find one you connect with, trust and who has a plan that will get you where you want to be. You might have to interview 10 before you find the right one but knowing you have the right person in your corner is worth its weight in gold.
__________________ OFFICIAL CP REALTOR & PROPERTY MANAGER
Travis Munroe | Century 21 Elevate | 403.971.4300
So what's the problem then? You don't like realtors because you're too cheap and probably ignorant of the job to think they're worth it.
How did the issues become apparent? I think you're blowing smoke out of your bum. If you didn't like realtor rates during the boom then you didn't have to use a a realtor. Nobody was putting guns to people's heads making them sign papers that clearly state how much a realtor would get for a sale.
And you'll pay an hourly fee? that's nice, how much are you willing to pay? what if your house doesn't sell in 30 days? what if you don't find a house you like? that is a lot of showings and a lot of paper work. I'd bet that it might be more by the hour and you might not even sell your house, or buy a house.
When the house I bought for $240K became worth $500K overnight, that was my win, not a realtor's IMO. Selling in a hot market is dead easy...it's a matter of posting a little write-up on MLS and slapping a key lock box on the front door. It's not worth $17,000 in commissions to me to sell a $500K house.
Not all clients are as easy as me, though. My wife and I took our own pictures for our house; staged the house ourselves; wrote, designed and printed our own spec-sheet hand-outs; and wrote our own MLS write-up. When we bought, we researched all the houses on our own and told the realtor which ones we wanted to see.
And if the market isn't hot? It doesn't take any of the sellers' realtor's time to arrange showings. My realtor has a program that will send me a text when somebody is going to come see my house. It's completely hand's off.
There is no paperwork at all if a house is on the market for a long time. It's just a matter of waiting.
I'm not saying their time is worth $0. What's their time worth? If I sell my current house, I'll find a realtor that will work for ~$75/hour, capped at the regular commission rate of 5%/3%/3% or whatever it is. That would be fair to me (an easy client who prefers to do a lot of the work himself) and would fairly compensate the realtor, which is also important to me. As an easy client, I don't want to subsidize a realtor's indecisive dope clients that can't make a decision or don't know what they want.
Quote:
Originally Posted by Winsor_Pilates
Why not use a flat fee then?
There's no rule commission have to be percentage based, nor is there any standardized rates.
I know that. I negotiated a lower percentage from my realtors on all three houses I've bought and two that I've sold. I would say most people pay the standard 5%/3%... that is charged, though. And by most I mean 99.9999999999999999999999999999999%.
I know that. I negotiated a lower percentage from my realtors on all three houses I've bought and two that I've sold. I would say most people pay the standard 5%/3%... that is charged, though. And by most I mean 99.9999999999999999999999999999999%.
With the extra $2000 coming out of the selling agent's pocket because the buying agent who would show a house at discounted commission is extremely rare.
The client's best interests are first and foremost as long as the commission is right.
ahhh, if only it really was all about sitting around and waiting when they were on the market for a lengthy period of time.
One of my recent listings is now off the market and I have no plans to re list.
The thousands of dollars I invested trying to sell this place + the 10+ open houses which average around 4 hours each + driving time for open houses or to show people the property etc ...this is never the story you will hear. Using your $75/hr rate seol, I lost WELL over 5k on this property. The next place I sell coupled with the costs/time involved in that client will help me break even.
Say this next place only involves 3 open houses, 1k of expenses + a handful of the typical phone/driving/meeting/paperwork/negotiations hours. I just put in 80 hours for free.
Im not saying I never give a break to someone in certain situations...a handful of cp members can vouch for that. What I am saying is that your perception of what goes on when you are not around is slightly off.
sent from the beaches of st lucia while sipping a mojito (had to lighten the mood a bit lol)
__________________ OFFICIAL CP REALTOR & PROPERTY MANAGER
Travis Munroe | Century 21 Elevate | 403.971.4300
I think you work harder than the realtors I've had experience with, Travis.
My $75/hour rate would work awesome for a guy like you, though. That's decent coin and you're at least compensated for your time when things normally wouldn't have worked out for you. I think it's a win-win and eliminates the ripped-off feeling I'd have if my house sold in 24 hours.
Snip...
I'll find a realtor that will work for ~$75/hour, capped at the regular commission rate of 5%/3%/3% or whatever it is.
Good luck with this. I am a consultant and my clients can either pay time and materials (they assume the risk if the job takes longer than estimated) or they can pay the flat rate (I assume the risk if the job takes longer than estimated, but I pad my quote to compensate).
You don't get to have it both ways. I had client tell me that's how his company normally does business and I told him "how nice for you". His choice at that point was to find a new consultant or continue to pay my hourly rate (I am still working with him).
The reason flat rates are offered at all is because they reward efficient, correct work by getting it done under budget. Otherwise the better you are at something the less time it takes, hence the less money you make, where is the incentive there?
Sellers: If you dont want to pay high commission fees then dont pay high commission fees
(There are plenty of full service Real Estate companies that charge less)
- Rhino Realty
- Seller Direct
- 1 Percent Realty
- 2 Percent Realty
Real Estate Agents: If you don't want to work for free then don't work for free
(Scrutinize every lead, do a proper CMA, and have a frank discussion with the seller)
I very rarely end up working for free because I politely decline listings where the seller is out of touch with the valuation on their property, are only slightly motivated to sell, or have un-realistic expectations.
The drawback of the MLS system in a hot market like Vancouver is it encourages absoloute tools into the industry, if anyone could list on the MLS it would probably weed out the lousy agents.
I have a friend who is an agent and is a nice guy but not particularly bright or talanted but makes 200,000 a year or more for doing a fairly easy (other than the hours) job, he chases listings and listings alone, sells a handfull of houses a year and makes more than the average lawyer.
In the Vancouver market what you expect from an agent is they will list your house for the area average, they may begrudgingly agree to show you houses but only to get your listing to be frank, they have learnt to rely on a hot market where no one has to really do a thing other than list on the MLS.
Last edited by afc wimbledon; 11-28-2012 at 01:26 PM.
The drawback of the MLS system in a hot market like Vancouver is it encourages absoloute tools into the industry, if anyone could list on the MLS it would probably weed out the lousy agents.
I have a friend who is an agent and is a nice guy but not particularly bright or talanted but makes 200,000 a year or more for doing a fairly easy (other than the hours) job, he chases listings and listings alone, sells a handfull of houses a year and makes more than the average lawyer.
There are so many things wrong with this statement
Good luck with this. I am a consultant and my clients can either pay time and materials (they assume the risk if the job takes longer than estimated) or they can pay the flat rate (I assume the risk if the job takes longer than estimated, but I pad my quote to compensate).
You don't get to have it both ways. I had client tell me that's how his company normally does business and I told him "how nice for you". His choice at that point was to find a new consultant or continue to pay my hourly rate (I am still working with him).
The reason flat rates are offered at all is because they reward efficient, correct work by getting it done under budget. Otherwise the better you are at something the less time it takes, hence the less money you make, where is the incentive there?
Government contracts often stipulate a maximum or bid amount but they need proof that you spent or allocated every dollar of that amount.
That said, government contracts make their money on the out of scope work.
For me, I will work for my rate sheet or a fixed rate but not a combination of both. I wouldn't expect less of a real estate agent.
My biggest complaint with their rate structure though is that they seem to make more money in a hot housing market when I would assume that they have to do more work in a cool housing market.
My agent tried to sell my old house last year, after 3 months and not a single offer we walked away and rented it out instead until the market comes back.
My agent didn't make a red cent on his time (we did use him to purchase our upgrade) but if I decided to sell again in the next couple of years I will give him a call.
It's easy to focus on the good times, but the flip side is a lot of work for no gain when the market sucks.
Is it very hard to get your real estate license? It seems like there are a lot of pretty crappy real estate agents that come out when the market is hot and disappear when the market is slow.
I interviewed a real estate agent for a labour position who couldn't understand how to find the point of intersection of two lines graphically. (You just extend them until they meet.)
