Radical changes coming for CREA

housingrental

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#41
JDaley
There might be a lot of bad realtors
But there are a lot of good ones too
That can add value to your transaction

QUOTE (JDaley @ Feb 9 2010, 07:08 PM) Don`t know what percentage of REIN members are realtors, but Brett`s comments appear to be contradictory (see above). If there aren`t many REIN members that are realtors, as Brett says, they are lurking on the forum - by his own admission, or whatever data gathering method he uses. We all know the CREA has no interest in promoting the smaller players to protect their large their commissions - to the detriment of home owners and the market. I haven`t used a realtor in years.
 

housingrental

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#42
I`m not a realtor
Do you hold my opinion in higher regard?
Being a member of a group doesn`t necessarily preclude you from having a meaningful opinion of it

QUOTE (JDaley @ Feb 9 2010, 10:52 PM) ... says a realtor. Yes I haven`t used a realtor in a while, but I have plenty of experience with realtors in the past. Attack the point and not the person. I think you`re on the wrong side of this agruement/discussion, aside from fellow realtors, you`ll find little sympathy from the general public regarding the CREA, its membership and its practices.
 

housingrental

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#43
Nonsense

There are many options now available for a homeowner wanting to sell themselves and generating lots of exposure for themself - like bytheowner.com propertyguys.com and many other sites

And if you add WILL PAY BUYERS AGENTS 2.5% you'll get lots of interest

And be thankful to be dealing with a realtor






QUOTE (JDaley @ Feb 9 2010, 11:38 PM)
I agree - but it'll never happen under the current rules. In a nutshell, most people who deicide to sell, don't want to deal with a realtor because of the commissions they're required to pay. However homowners end up using a realtor - Why is that ? The basic answer is because home owners have no real alternative. The Competition Bureau knows this and wants to put an end to the CREA practices, that results in excessive commissions.
 

spark1

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#44
QUOTE (RedlineBrett @ Feb 9 2010, 05:06 PM) MOST rein members are not realtors... so I don`t know how much I believe that statement. I think it`s a bit of a stretch to insinuate that Don has a hidden agenda to protect his realtor buddies. I certainly haven`t recieved a flower basket from him or anything. Where`s the love Don? LOL

I think it would be safer to assume that Don is commenting from the perspective of someone that has acquired somewhere around 1000 doors and built a business that provides clarity to those interested in Canadian investment real estate. He does frequent these forums, maybe you should send him a PM and ask him personally.


Typically Don is very good in his unbiased research. It is always pleasure to listen and see him. However, this interview showed him not in the best light. I believe MOST of RE investors want more competition for their business, easy available comps, assess to MLS (naturally for a reasonable fee), etc. Unfortunately there are many bad realtors around, the public should have a choice not between realtor A and realtor B, but a variety of products (flat fee MLS posting, historical sales only, full realtors support, etc.). Selling/buying a house is not a rocket science, given all information many can do it themselves saving thousands of dollars in unnecessary commissions.



The sooner CB cracks on CREA the better for the industry.



Go CB go! Realors you may start to look for a real job because new market can not sustain 100,000 realtors in Canada! Many of you will not survive.
 

JDaley

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#45
QUOTE (housingrental @ Feb 9 2010, 09:59 PM)
JDaley

There might be a lot of bad realtors

But there are a lot of good ones too

That can add value to your transaction




Yes no doubt. However reducing commissions to more sensible levels through competition, lets say $1,000-$3,000/transaction would be equivalent to a tax cut, resulting in more activity in the market as a whole. Homeowners could spend that additional money in home improvements, furniture etc. Those realtors that outperform can charge higher fees e.g., > $5,000. Its equivalent to paying a good lawyer vs an average lawyer for services. Compare this to paying commissions of $40,000 on a $1M transaction.
 

Lucas

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#46
Hi JDaley,

Relaotrs commissions are negotiable...the 7% and 3% split is not set in stone or law or policy. You, as a seller, can approach any realtor and ask them to sell your house for the amount of mobney you feel is fair and there are many realtors and brokerages that would oblige... AND they have MLS access.

Speaking as a Realtor and as a former oilfiled worker, construction worker, small business owner...good realtors EARN their money...I would like to think that I add value to my clients on both the buying AND selling side. I charge what I think is suitable to my services rendered.

The realtors that are sub-par have a tough time feeding their family b/c they may not add the value that people look for when they "realtor shop"...just like a crappy lawyer or a bad drywaller or whatever...this seems fair to me...It seems like you have some misdirected anger...

Lucas

QUOTE (JDaley @ Feb 9 2010, 11:18 PM) Yes no doubt. However reducing commissions to more sensible levels through competition, lets say $1,000-$3,000/transaction would be equivalent to a tax cut, resulting in more activity in the market as a whole. Homeowners could spend that additional money in home improvements, furniture etc. Those realtors that outperform can charge higher fees e.g., > $5,000. Its equivalent to paying a good lawyer vs an average lawyer for services. Compare this to paying commissions of $40,000 on a $1M transaction.
 

wealthyboomer

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#47
QUOTE (Lucas @ Feb 9 2010, 10:46 PM)
Hi JDaley,



Relaotrs commissions are negotiable...the 7% and 3% split is not set in stone or law or policy. You, as a seller, can approach any realtor and ask them to sell your house for the amount of mobney you feel is fair and there are many realtors and brokerages that would oblige... AND they have MLS access.



Speaking as a Realtor and as a former oilfiled worker, construction worker, small business owner...good realtors EARN their money...I would like to think that I add value to my clients on both the buying AND selling side. I charge what I think is suitable to my services rendered.



The realtors that are sub-par have a tough time feeding their family b/c they may not add the value that people look for when they "realtor shop"...just like a crappy lawyer or a bad drywaller or whatever...this seems fair to me...It seems like you have some misdirected anger...



Lucas


"The name of the game is speed ` closing many deals as quickly as possible, and moving on to the next. It's a volume business, disguised as a service."---Freakonomics by Steven Levitt and Stephen Dubner
 

wealthyboomer

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#48
QUOTE (housingrental @ Feb 9 2010, 09:59 PM)
JDaley

There might be a lot of bad realtors

But there are a lot of good ones too

That can add value to your transaction




Why we hire Real Estate Agents?:

http://tinyurl.com/yad4zet

Realtors ` like financial planners, childbirth doulas and fortune tellers ` bring the reassuring illusion of expertise to an inherently terrifying experience.....
 

TodorYordanov

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#49
QUOTE (REINteam @ Feb 9 2010, 06:22 PM)
Here is a link to the audio hosted on our site: http://www.reincanada.com/Video/TabId/74/V...aspx?type=audio



Below the audio box there is a URL generator as well as an Embed code generator, or you can copy and paste the code below if you wish to use this:




CODE
<object allowFullScreen='True' allowScriptAccess='always' allowNetworking='all' width='400' height='150'><param name='movie' value='http://www.reincanada.com/DesktopModules/UltraVideoGallery/mp3.swf' /><param name='allowFullScreen' value='true' /><param name='flashvars' value='vId=115&portalId=0&baseUrl=http://www.reincanada.com/DesktopModules/UltraVideoGallery/' /><embed src='http://www.reincanada.com/DesktopModules/UltraVideoGallery/mp3.swf' type='application/x-shockwave-flash' allowFullScreen='True' allowScriptAccess='always' allowNetworking='all' width='400' height='150' flashvars='vId=115&portalId=0&baseUrl=http://www.reincanada.com/DesktopModules/UltraVideoGallery/'></embed></object>






Hope this helps.






Ray, thanks for the code. Plese post more of those as they become available. Very usefull for my blog.
 

JDaley

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#50
QUOTE (Lucas @ Feb 9 2010, 10:46 PM)
Hi JDaley,



Relaotrs commissions are negotiable...the 7% and 3% split is not set in stone or law or policy. You, as a seller, can approach any realtor and ask them to sell your house for the amount of mobney you feel is fair and there are many realtors and brokerages that would oblige... AND they have MLS access.



The realtors that are sub-par have a tough time feeding their family b/c they may not add the value that people look for when they "realtor shop"...just like a crappy lawyer or a bad drywaller or whatever...this seems fair to me...It seems like you have some misdirected anger...



Lucas




Lucas, no anger here, would just like to see fair play for the good of us all - btw I was wondering when you would insert a dig at me while reading your post lol.



But great suggestion, real good idea, I never thought of it in the 15 yrs I've been investing in Real Estate, a negotiated commission! So what do you think a new rate would be if I negotiated a new commission with a realtor ? $5,000 discount on a $1M transaction ? So I'd pay $35,000 instead of $40,000 ? Wow I'm rolling in my money now. I only pay a realtor $35,000 instead of $40,000. Or lets say $30,000 (which a realtor broker would never agree to do). The fact is I've tried this approach in the past, and the important thing you left out of your post is that the Realtor immediately warns you that by lowering commissions your property will receive less interest from other realtors - not to mention irritating the realtor for a reduced fee structure. This is why the Competition Bureau needs to fix this problem. By regulating the RE market to some extent, in a fair and balanced way, the market will thrive since moderating excessive commissions is equivalent to a tax break. Other realty specialists such as WeList should be allowed to list on the MLS or some other similar broad based system so that buyers and sellers have access to the entire market.







From these posts, it appears in some cases, Realtors on this board aren`t here to help us as much as advertise their services ` sorry but this is the hard realty of this topic.
 

outtolunch

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#51
This is certainly a tough one to pick sides on. While not a REIN member or a realtor I have certainly used realtors over the years for many of my investments...and not for others. I`ve found that a realtor can absolutely save me money AND find me great properties, but I`ve certainly seen my fair share of realtors who aren`t worth a cent.Example - a friend who is not real estate saavy wanted to complete a private transaction, essentially a house swap, she gets a bigger house and the other couple downsizes, pretty easy. However, she had no clue about the paper work or putting together an offer, etc. She contacted a realtor, asked for a price (house was around $285) to do up the offer and conditions....came back with $4000 flat rate. This I have a problem with, it`s a joke - I set her up with an offer and a lawyer, took me 15 mintues to do all the upfront paper work and it was smooth as silk - not $4k worth of work. The general public is far too uniformed when it comes to real estate - but that is their own fault, it`s not rocket science.

With that said, why on earth should anyone here, other than realtors who pay for it, have access to list on the MLS? So you don`t want to spend $40K to sell your million dollar property...then don`t, it`s that simple! You have plenty of options for sellling your own home so do it. Learn how to market effectively, spend the money to develop your own website, build your own database, spend money on ads in the paper, billboards, tv, radio, etc, no one is holding you back. Now...add up the time it will take to do all this, plus show the house over and over and add it to the marketing costs and web hosting etc and see what the number is (don`t forget to put a value on your time AND add the cost of holding that property for longer than expected, each month you pay X amount to hold) and see if it is less than the $40k.

As a small business owner and long time investor it is not worth my time (in most cases) to do all of this, nor do I actively market myself on a monthly basis, so my choice is pretty simple. Do I like paying for this??? Of course not...but I certainly don`t expect to get something JUST BECAUSE...but then again, that is the way of the world these days - entitlement has run rampant!!

If you owned a successful business and spent years marketing and thousands, maybe millions, on website development should everyone have cheap access to your service and/or website simply b/c you were successful??


Rant over, just one mans opinion
 

RedlineBrett

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#52
QUOTE (outtolunch @ Feb 10 2010, 10:22 AM)
This is certainly a tough one to pick sides on. While not a REIN member or a realtor I have certainly used realtors over the years for many of my investments...and not for others. I've found that a realtor can absolutely save me money AND find me great properties, but I've certainly seen my fair share of realtors who aren't worth a cent.



Example - a friend who is not real estate saavy wanted to complete a private transaction, essentially a house swap, she gets a bigger house and the other couple downsizes, pretty easy. However, she had no clue about the paper work or putting together an offer, etc. She contacted a realtor, asked for a price (house was around $285) to do up the offer and conditions....came back with $4000 flat rate. This I have a problem with, it's a joke - I set her up with an offer and a lawyer, took me 15 mintues to do all the upfront paper work and it was smooth as silk - not $4k worth of work. The general public is far too uniformed when it comes to real estate - but that is their own fault, it's not rocket science.



With that said, why on earth should anyone here, other than realtors who pay for it, have access to list on the MLS? So you don't want to spend $40K to sell your million dollar property...then don't, it's that simple! You have plenty of options for sellling your own home so do it. Learn how to market effectively, spend the money to develop your own website, build your own database, spend money on ads in the paper, billboards, tv, radio, etc, no one is holding you back. Now...add up the time it will take to do all this, plus show the house over and over and add it to the marketing costs and web hosting etc and see what the number is (don't forget to put a value on your time AND add the cost of holding that property for longer than expected, each month you pay X amount to hold) and see if it is less than the $40k.



As a small business owner and long time investor it is not worth my time (in most cases) to do all of this, nor do I actively market myself on a monthly basis, so my choice is pretty simple. Do I like paying for this??? Of course not...but I certainly don't expect to get something JUST BECAUSE...but then again, that is the way of the world these days - entitlement has run rampant!!



If you owned a successful business and spent years marketing and thousands, maybe millions, on website development should everyone have cheap access to your service and/or website simply b/c you were successful??




Rant over, just one mans opinion






Great post.



However your friend contacted an expert and got expert advice. That is part of the $4,000 flat rate she was quoted. Takes 15 minutes to draw up a contract if you know what you're looking for but you know the risks if you draw one up poorly. You might pay a plumber $400 to come and fix a $20 part... but they're an expert and know what to look for so we justify it. You might pay a lawyer $5,000 to handle your case and all they are doing is talking on the phone and reading. But we justify it because they have a law degree so they must be doing hard work. I'm having a tough time understanding why realtors - experts in their own field - don't get the same respect.
 

JDaley

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#53
QUOTE (outtolunch @ Feb 10 2010, 10:22 AM)
If you owned a successful business and spent years marketing and thousands, maybe millions, on website development should everyone have cheap access to your service and/or website simply b/c you were successful??



Rant over, just one mans opinion




The point of the CB complaint centers around exclusion resulting in a near market monopoly and excessive fees. Similar cases existed in the US with Microsoft and its IE product, big Oil (Standard Oil ) etc. The fact of the matter is that the CREA will lose this case. The decision and the order that results from it, will benefit, buyers, sellers and realtors in the long run - and I think that's healthy for the market place. The behavior of realtors is driven by the environment they operate under - and hopefully that will change for the good of us all.
 

TheVancouverMarket

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#54
QUOTE (JDaley @ Feb 10 2010, 08:51 AM)
Or lets say $30,000 (which a realtor broker would never agree to do). The fact is I've tried this approach in the past, and the important thing you left out of your post is that the Realtor immediately warns you that by lowering commissions your property will receive less interest from other realtors - not to mention irritating the realtor for a reduced fee structure.






Who says a realtor broker wouldn't drop the commission from $40k to 30k ? Have you tried ? You should try it. You might be surprised at what you get.



As far as managing how the commission is displayed to the market and how you are concerned it might affect the potential sale or number of showings etc .... tell the realtor that the buyer's agent commission won't be reduced but (his) the listing realtor's commission will be reduced instead. That way there is no real or perceived difference between your listing and others.



If the realtor doesn't like it he will take a pass or you go find another realtor. Last time I checked there wasn't a shortage of hungry, ambitious realtors in Canada.



Your challenge comes in the form of 'quality control'. If the realtor is willing to act on the basis of substantially reduced commission you might want to due some due diligence on his experience and knowledge level amongst other things. Set you expectations out clearly and in writing on the listing (or buyer's contract)



How about suggesting the realtor do it for $30,000 but give him a performance bonus if he is able to negotiate a sale a certain amount above list price....or not as the case may be...it's all up to you to decide what you want and go out and get it.



I'll say it again, all services and commissions are negotiatiable - so go wild. There's as many potential commission and service structures out there as there are realtors.



Good luck !
 

RedlineBrett

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#55
QUOTE (JDaley @ Feb 10 2010, 08:51 AM) But great suggestion, real good idea, I never thought of it in the 15 yrs I`ve been investing in Real Estate, a negotiated commission! So what do you think a new rate would be if I negotiated a new commission with a realtor ? $5,000 discount on a $1M transaction ? So I`d pay $35,000 instead of $40,000 ? Wow I`m rolling in my money now. I only pay a realtor $35,000 instead of $40,000. Or lets say $30,000 (which a realtor broker would never agree to do). The fact is I`ve tried this approach in the past, and the important thing you left out of your post is that the Realtor immediately warns you that by lowering commissions your property will receive less interest from other realtors - not to mention irritating the realtor for a reduced fee structure. This is why the Competition Bureau needs to fix this problem. By regulating the RE market to some extent, in a fair and balanced way, the market will thrive since moderating excessive commissions is equivalent to a tax break. Other realty specialists such as WeList should be allowed to list on the MLS or some other similar broad based system so that buyers and sellers have access to the entire market.

Why don`t you interview 100 realtors and find someone willing to list your $1M property for $1,000 instead of $40,000. If you`re such an experienced investor negotiate! You can choose to work with whatever brokerage you want. Don`t whine and cry because the good realtor you want is insisting on $40,000 when you feel he should work for much less. Do you sing the same song about your dentist or your lawyer? Should the competition bureau regulate them too?

Bottom line is you have the choice as a consumer to pay for whatever fee you feel is reasonable. People selling on MLS do this every day because they feel they are better off having a paid professional as an advocate for them. There are super discount brokerage options out there just like there are dollar stores to shop at. You can do it yourself too just like you can be your own lawyer or you can be your own dentist if you`re so inclined. There are 100s of business models in real estate sales. Perhaps you should look into them if you haven`t used a realtor in a while.

The competition bureau isn`t talking about "regulating" the real estate industry to force all realtors to cut their fees - they are talking about giving easier access to consumers to merely LIST their property for sale through the dominant marketing medium MLS.ca. If the CB wins CREA could decide to just take MLS.ca offline altogether like Don mentions.
 

MikeMcC874

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#56
I think this thread is exposing a number of different issues but mixing them together.

1) Access to the MLS service: This service and the data it contains is the property of CREA. IMO they should have the ability to use this data as they see fit. To a limit.
2) The software they use to store this data. Is purchased by CREA&#092;OREA and others from companies like Filogix. Technically anyone could buy the software and replicate it.
3) Real Estate Fees - This seems to be what most people are actually complaining about and is really seperate from the MLS data. To a point...

The anti-competitive situation is that the CREA uses the MLS to help guarantee prices and create a barrier to entry.

For a competing service you would have to get all the agents to register all their sales with the competing service to make it viable. However, despite the fact it would have a possible advantage for the clients, it would put longer term pressure on commissions and mean more work for agents. CREA certainly would not mandate it. Over time it would diminish the dominance of the MLS and actually have a negative impact on sellers by causing confusion in the market. What site should I check? What site should I pay to post on? If the government was really concerned here, they would create a registry and require licensed agents to register all transactions. Not sure i would want the government getting involved though...

The other point I have not heard mentioned is the role the big franchises like Century 21 and Remax play in controlling prices. Do they?

Personally I don`t mind paying an agent. I do resent the fact that I can`t get direct access to the data to do whatever analysis I see fit. The MLS website is of very poor quality and screams to me that they are doing the minimum they feel they have to.

I do think the fee`s in general are a little too high. If I knew I was getting an issue free transaction on both ends, I might not have such an issue. My issue is great, the others, not so much. On my recent transaction the listing agent:
1) did not have all the keys available for my first trip out.
2) Mis-quoted one of the units rents.
3) Misquoted inclusion of utilities on one unit.
4) Did not know what an electrical inspection certificate was.
5) Waited till 2 days before close to get 5 year old electrical and fire certificates
While looking, there were a number of agents that took days to answer questions and a couple that never bothered to supply the info requested.
Looking at the MLS website there are constantly properties that have little or no text, are suspended or have closed.

Even so, I am willing to pay to get access to the data. Let me...

Good discussion all...

Mike
 

Cargren

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#57
QUOTE (RedlineBrett @ Feb 10 2010, 11:09 AM) The competition bureau isn`t talking about "regulating" the real estate industry to force all realtors to cut their fees - they are talking about giving easier access to consumers to merely LIST their property for sale through the dominant marketing medium MLS.ca. If the CB wins CREA could decide to just take MLS.ca offline altogether like Don mentions.

I am not a Realtor and dislike paying fees just as much as the next guy, but Brett is right. What some seem to think is that mls.ca is a public or government owned service/entity. IT IS NOT. It is privately owned and subject to the market. Sure is dominates the RE scene, but that was not always the case, and anyone is free to develop a rival system. We have the option of using it or not. If you don`t think CREA realtors don`t bring something to the table don`t use them!
 

RedlineBrett

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#59
QUOTE (MikeMcC874 @ Feb 10 2010, 11:16 AM)
The other point I have not heard mentioned is the role the big franchises like Century 21 and Remax play in controlling prices. Do they?



Even so, I am willing to pay to get access to the data. Let me...



Good discussion all...



Mike




The big franchises pass a lot of their fees onto their agents in the form of monthly 'franchise fees'. The balloons and adds on hockey rinks have to be paid for by someone. Since most of the agents belong to big franchises they pass these costs onto their clients. But in the end they are no different than a comparison between Mcdonalds and joe's hamburger stand. The consumer decides.



The industry goes out of it's way to make sure the public knows that fees are completely negotiable.. agents are fined and some lose their licenses for advertising otherwise.



Regarding paying for data a good realtor will give this to you however you want it. One thing CREA does exceptionally well is store data and operate a sales database. I have an engineering degree and am a total datafreak and I continue to be impressed by the robustness of the MLS sales database.



You can also hire an appraiser (also members of CREA) that has access to the MLS database and will prepare a huge report for you on any property you like for around $400.
 

GaryMcGowan

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#60
QUOTE (RedlineBrett @ Feb 10 2010, 02:03 PM) Here is an article in the Globe that talks a little bit about the overall issue being contested by the CB.

http://www.theglobeandmail.com/report-on-b...article1462682/

Here is my take away from the Article.

465,251 homes sold in 2009 (I would like to know the avg, for the last 5 yrs)
$320,333 avg price per home.
98,000 agents.

4-5 properties per agent.
Based on 5% com, subtract sharing the commission with another realtor and brokerage fees. The realtor`s commission is down to $5,500 - $6,500 per transaction.

I do not envy Realtors as there is a lot of competition already.