MoneySense.ca: Stocks & Markets: Inside the real estate maze: what your agent won’t tell you
A good article on things your real estate agent won’t tell you.
1. Always an option to sell yourself. Two sites mentioned in article: ForSaleByOwner.com and 4SaleByOwner.com. An appraiser is also a good idea if you’re going to do it yourself to get the price in the correct neighbourhood. If a strong market, mark up appraised price 10-15%. AICanada.ca.
Personal opinion: Be prepared to spend the time required to show the house and do the negotiations, but if you’re in a ‘hot’ neighbourhood, no reason this shouldn’t work.
2. Fees are negotiable. If a fast selling neighbourhood, selling and buying with the same agent, or agent brings buyer to table, can negotiate.
3. Conflicts may exist The agent is in the business to sell homes, so they may not tell you all they know about a home, or your situation. After all, the longer it takes them to sell your home, or get you to buy, the longer they have to wait for their paycheque.
4. GST on Commission The Canadian government can’t keeps its hands off anything. I guess they figure it’s a service, therefore they can collect GST. Negotiate up front with your agent to have them reduce their commission by this amount, or at least be aware of the fact that you have to add 7% of commission to your final cost of selling your home.
5. Don’t price too low If you under price your home, you will get lots of people looking, but may get a case of buyer’s remorse after the close. Then the buyer may want out and start legal proceedings to get out of the deal. If it’s priced reasonably, you should get seriously interested buyers.
6. Open houses help the agent more then you This one was a bit of a surprise to me, but after reading the reasons, it makes sense. Basically, an open house is more of an opportunity for the agent to meet prospective clients. How many open houses have you gone to where you just wanted to see the house?
The MLS listing should be enough. Good agents will know about the homes for sale in the neighbourhood their clients are interested in, and will make arrangements for a viewing (you’ll have viewings whether you have an open house or not). Avoids having many people browsing through your home, and having to be away for 3-4 hours.
7. Listing may not be accurate The agent should verify that everything in the listing is correct, but they don’t necessarily do that. This applies to buyers and sellers. Verify the listing for your own home, and confirm items on the list of a home you’re looking at.