What are you doing to help out in your community this holiday season?
James Howe wrote a great post today about Jodi Sonoda and some of the things she is doing this year. You can read it here.
My family has a yearly tradition of helping out the local foodbank packaging up toys for kids that won't see presents under the tree without their assistance. It is always humbling and helps us put things into perspective, specially with our own kids.
I know from talking to them the nights are almost full (which is a great problem to have). If you want to get involved and have some time give them a call.
Cambridge Self Help Food Bank
Family & Friends Night - Calvary Pentecostal Church, Hespeler Road
Monsday December 12, 2011 6:00 to 7:00 or 7:00 to 8:00 pm
Wednesday December 14, 2011 6:00 to 7:00 or 7:00 to 8:00 pm
This is our second year for our Family & Friends night, so come on out and bring your family and/or friends to help pack toys for kids. Refreshments will be served, Christmas music, and gain an understanding of the work we do for families at Christmas time.
Open to all ages but children must be supervised at all times by parent.
Please call to reserve a spot for your group as times are saved for those only that have registered. Call Alie at 519-622-6550 ext. 203 or email: projects@cambridgefoodbank.on.ca to reserve a time for you.
So Where Does All Your Money Go?
It seems more important today than ever!
A recent blog post on buzzbuzzhome.com has us look at the transaction of a home purchase from an economic standpoint. How does your home sale/purchase impact our economy?
It would seem that the national average "service and taxes" fee of $22,775 sits well with the traditional high fee real estate agents.
Imagine another reality...the $10.2 Billion spent on these services was reduced to a fraction and the average home owner had more equity, more accessible cash and less debt. What would our economy look like then?
M
How Does Your BRA Fit?
They are not one size fits all, or so my wife tells me!
Garth Turner had a great post on his Greater Fool blog exposing the Buyer Representation Agreement and the dangers of signing one.
There were a lot of really good points brought up in this blog. The one area that he didn't get into is that not all agreements are equal. A BRA is as varied as a seller's agreement and depending on the local real estate board or even individual realtors, they can differ.
For the first time I am going to ask for homework. Think about what you would look for in your BRA. If you could write a BRA that would fit you like a...well bra, what would it look like?
M
What does "Discount Realtor" really mean?
Just who is getting the service?
Let's first understand what the traditional "high fee agent" (5%) break down looks like. Typically a 5% commission is split 50/50. Meaning 2.5% goes to the buyer's brokerage and 2.5% goes to the listing brokerage. This means in a $300,000 home there is $15,000 in commissions paid. Man, that's a lot of skin!
In a typical discount brokerage 3% Program the listing brokerage typically discounts their fees down to 0.5% and offer 2.5% to the buyer's brokerage or on occaision they do 1% and offer 2% to the buyer's brokerage. In one way the listing agents are not getting "their share" and may skimp on the service. The other, buyer's agents will prefer to show other listings where they get 2.5%. Same house as above and your still spending $9,000. Still more then a skinned knee!
A typical 1% Program the agent is not offering any commissions to buyer's brokerages and are expecting to work on behalf of both buyers and sellers. The real danger is that for buyer's to get the info they have to call your agent. Your agent now has a buyer looking to buy a home. Your home pays them 1%. Every other home listed with agents (High Fee or Discounts presented above) get your agent more money. Why would they push your home when they can sell the one up the street and make more money! It may only be $3,000 if it sells but unfortunately for you they sold one of the two above and made $7,500 so you sit with their boring old square sign on your lawn selling other peoples' houses!
Ever think someone was telling you one thing and then doing another?
M
Exclusivity...at it's finest!!
Who are you being exclusive to?
The term "Exclusive Listing" is one that had gone by the way side it would have seemed. More and more I am finding people with that sticker on their sign though. I ran by one this morning and it got me thinking. What is that agent offering as an "Exclusivity"?
Traditionally the reason a home seller would choose to go the route of an exclusive listing would be to save on commissions. The listing agent has said that in order to save on the buyer's agent commissions "we won't put the listing on the MLS and I will market it locally on my website, in the paper and through my network of buyers". This really is not that far off selling it privately, except your agent is going to charge you 2-2.5% if a buyer ends up bringing an offer.
I mean the whole term "exclusive" comes from "excluding" things, right? Why when you are selling your home would you want to exclude putting your home in front of buyers? Pick an agent in your town, any agent. Go to their website and browse through it. Was that a good experience? Heck most of them when searching for homes just point you back to Realtor.ca anyway!
If you are looking to save money when selling your house going to someone who drives an $80,000 car and talks about all the houses they sell is probably not going to do it, exclusive or not. Going to the agent around the corner, or the one who's son plays with yours at school and lists 3-4 houses a year probably isn't going to help you much either. The biggest bang for your buck is to ensure your listing looks professional for the online shoppers, has plenty of eye catching signs for the drive buy people and is in front of as many people as you can afford to get it in front off. Traditional real estate agents will charge you 5-7% ($15,000 - $21,000) for the average home sale ($300,000 house in the Waterloo Wellington area). Discount agents will charge you 3-4.5% ($9,000 - $13,500). Exclusive listings usually run 2-2.5% ($6,000 - $7,500) but REALLY limit your exposure.
Selling privately with PropertyGuys.com gets you all the same exposure to buyers, including a listing on Realtor.ca, for under $2,000 for the average home seller. Could be less depending on what options you want, not the value of your house!
So if you are ready to jump in, say it "I'm ready and you're the one I want!"
M
Are You Being Exposed?
Not by this publication!
So you have to ask yourself "How will buyers see my property?" Exposure is one of the keys to selling so where will your home be marketed?
Mid-way through last year the Realtors of the Guelph and District Real Estate Board decided it was in their clients best interest to no longer focus on advertising their clients in the Guelph Mercury. They felt that instead of having their clients' listings sent right to the door of many Guelph homes that they would "Go Green" and cut distribution by 3/4 and that home buyers would search out their paper around Guelph in their Green Boxes. Given that it has been a week since the plows have been out plowing snow it appears that not to many buyers are using these green boxes.
Our clients still have the option of local print advertising with any listing done. Whether it is in Guelph with the Mercury, KW with the Record, Cambridge with the Times or Wellington County with the Advertiser. Mind you our clients also have access, through a partnership, to list their properties on Canada's busiest real estate website along with listing on PropertyGuys.com.
It leaves me asking what do Realtors offer for all that money that you can't get yourself with a little guidance?
M
Using an Agent is FREE for Buyers....
Not a chance!
I hear this regularly. In my opinion, this is one of the biggest fallacies in real estate today!
Just because you don't stroke a cheque to your realtor doesn't mean you are not paying for it. Think about it. If you are selling your house and using a real estate agent your first thought is generally "I need to get $X for my house". Then you figure what the agent is going to cost and tack it on top. Looking at it from that point of view....the buyer ends up paying the ENTIRE realtor commission as the seller has passed it on to you.
I prefer to look at it this way. The cost of selling the home is on the seller and the cost of buying is on the buyer (what can I say...I am a no nonsense kinda guy). In a standard 5% realtor assisted transaction the 5% is split 50/50 between the buyers agent and the sellers agent, 2.5% each.
In a Private Sale transaction the seller pays to market the home with services like PropertyGuys.com and the buyer is responsible to pay for any representation he chooses to use (buyer's agent). Now this can be negotiated into the purchase price, meaning the buyer pays more for the house than without the agent, or the buyer can pay for the agent themselves. We have seen this happen but it is for sure the minority. Our experiences tell us that less than 15% of private sale transactions have a buyer's agent involved and that the BUYER is the one paying for them, even if they are paid through the transaction!
Now what exactly is a "Buyer's Service Agreement"? Below an agent describes what "Buyer's Representation" is. Pay attention to the comment about paying the agent whether they are the ones who find you the house or not. This would mean once you sign the agreement you are on the hook even if they do NO WORK!
M
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