But They Are Doing Me A Favour!

Are they?

I have been knocking on a lot of doors lately. Last week I had the pleasure of talking to a gentleman about his listing with a C21 agent. As he answered the door and saw my PropertyGuys.com Beetle over my shoulder he was quick to blurt out "I already have an estate agent." He continued on in his proper British accent about how the agent was giving him a deal by lowering the price on the house he was purchasing because he had listed with her.

So in this case the house was listed for $459,900. That means that the commission the home seller was expecting to pay was $24,097.50 including GST. What I am trying to figure out is how is this agent going to reduce the purchase price of the house they are buying by nearly $25,000. Generally if an agent does both sides of a deal (working on behalf of both buyer and seller) they reduce their commission from 5% to 4%. Let's say this agent was feeling awfully generous this day or even more likely, motivated to move the property and adjusted her commissions to 2.5%. For her to reduce the price by $25,000 it would mean this couple was buying at least a $1,000,000 home. Seems like a bit of a stretch for an upgrade, but possible.

If you are shopping to buy a house and the one you want is listed with an agent keep in mind that if they offer to work both sides of the deal to reduce the price of your purchase, under the condition that you list with them, they are not doing you any favours.

If they want to do the world a favour, they would let you sell privately and then you could pass on some of your savings to people that could REALLY use it...


Get involved with Kiva and make a difference in the world.

M

Can I Check Your Oil?

Have you noticed that "Full Service" gas stations just aren't "Full Service" anymore?

In the days of the "Service Station" things were different. You went down and visited Joe for everything from lead gasoline, getting your points done or a tweak of your carburetor. This started to change as the technology changed. Carburetors were replaced by fuel pumps, points were replaced by distributor caps, and unleaded gas became the norm. The service station was replaced by the gas station but it was still full service. The attendant washed every customer's window, he asked to check everyone's oil, he topped up all fluids. Technology continued to change. The need of full service was replaced by "pay at the pump" and no one looks under the hood anymore....not even car owners! Sure they still have "full service" pumps at some stations...but you are paying 2-5 cents per liter more so you don't have to get out of the car and pump your gas...not really full service is it?



It would seem there are some parallels to the real estate industry here...

M

Looking Out For Your Financial Freedom?

How soon do you plan on retiring?

I don't care if you have your investments with a bank, an insurance company or an independent financial planner. Fact is, if your financial adviser is not discussing your choices of how to sell your home they are not working in your best interest.

Think about it. If you were to live in 4 houses in your life how much money could you waste on a real estate agent. Let's do the math, shall we.

Year 1 (Age 30) First Home - Modest townhouse selling for $225,000
Agent Commission 5% - $11,250
GST on Commission - $562.50
Total amount not invested - $11,812.50

Year 5 (Age 35) Second Home - Single detached selling for $300,000
Agent Commission 5% - $15,000
HST on Commission - $1,950
Total amount not invested - $16,950

Year 20 (Age 50) Third Home - Large family home selling for $450,000
Agent Commission 5% - $22,500
HST on Commission - $2,925
Total amount not invested - $25,425

Year 30 (Age 60) Fourth Home - Bungalow selling for $300,000
Agent Commission 5% - $15,000
HST on Commission - $1,950
Total amount not invested - $16,950

At 60 I hope that we are all ready to retire (if not before). All ready to buy a cottage on a lake in Northern Ontario and a condo in Palm Springs. So let's look at our investment profile....or more importantly what didn't end up in it. The total amount of commissions (including taxes) paid to real estate agents through your life was $71,137.50. That sure is a big number! But let's add in the aspect of lost interest into that figure over the 30 years and see what it is.

Using the Bank of Canada investment calculator over the 30 years at 6% interest the $11,812.50 from our townhouse would have been $67,844.99. The $16,950 from our second home would be $72,747.21 over 25 years. The $25,425 from our 3rd home would be $45,532.30 over the 10 years. Of course our $16,950 doesn't get invested because we just sold that place. So the total money not in our financial portfolio due to needlessly spending it on real estate agents is $203,074.50.

You always have other options...


M

Best of the Best!

Well the votes were tabulated and the winners were honoured.

Jan 27th 2010 the PropertyGuys.com annual Revvy Awards were held in fabulous Las Vegas NV. As you can see from the picture above the awards had a groovy theme based on the swinging sixties with a little Austin Powers mojo.

Franchisees and associates from across the country gathered together to honour the best of the best. Here are the winners for 2010...

- Cathy Young Perseverance Award: Leanne Carter, Grey Bruce, ON
- Associate of the Year: Tonya Brubacher, Waterloo Wellington, ON
- Model Office Award: Rick Davies, Belleville-Quinte, ON
- Most Listings Award: Donny and Tiffany Legere, Moncton, NB
- Homey Marketing Award: Daina Hernden, Truro, NS
- Private Sale Professional (PSP) Award: Linda Bernier, Timmins, ON
- Rookie of the Year: Katherine Benoit, Norfolk- Haldimand and Niagra, ON
- Top Performer (West): Simon A. Jones, Kootenays, BC
- Top Performer (Central): Dave Waters and Mike Shanks, Waterloo Wellington, ON
- Top Performer (East): Donny and Tiffany Legere, Moncton, NB
- Franchisee of the Year: Donny and Tiffany Legere, Moncton, NB

Congratulations to all winners! I would like to give a few "shout outs" though. Fist to Leanne Carter of Grey Bruce. Leanne and her husband Perry were clients of mine in Cambridge a few years back. When I was in and sat down with them in their kitchen I couldn't help but notice over Leanne's right shoulder she had some "start your own business" books. I made mention that there were franchises available with PropertyGuys.com and to look into it. Well within days not only was their house sold but they were looking into purchasing the Grey Bruce franchise. Always great to see hard work honoured but it means more when you saw the spark that started the fire!

Last year our own Sue Machado was honoured with Associate of the Year award. 2010 has brought the return of the Associate of the Year award to Waterloo Wellington but this year Tonya Brubacher was honoured. If you have ever met Tonya you know her love for her clients is almost always shared with a hug. Here are a few testimonials from her clients:

"Absolutely a delight to deal with Tonya Brubacher. Professional, courteous , enthusiastic and knowledgeable. We would not hesitate to use PropertyGuys.com again as it was not stressful but loads of fun and we saved a bunch of money in not having to pay commissions."
Peter and Heather Ternoway
Elora, Ontario
"Sold in about 2 weeks. PropertyGuys.com provided a friendly professional service, and saved us thousands. No wonder every other PropertyGuys sign has a SOLD sticker on. Thank you Tonya, professionals like you make the difference."
Greg Boyajian
Guelph, Ontario
"The PG team have perfected what it takes to get you all the way through to 'SOLD.' Their professional acumen, knowledge, personal touch, and genuine interest in your success is unparalleled. Lifelong friends have been made in the PG process."
Donna Maidmen
Guelph, Ontario

Nothing more needs to be said...so shhh....


M