# Flat-fee / Cash-back model for buyer's realtor in Quebec



## ariadne (Dec 5, 2020)

I am actively looking to buy a house in Montreal. I am quite comfortable with doing the search and going through the sales process myself as I’ve done it before. I fully respect the real estate brokerage industry and personally I do not need a realtor -I prefer a hands-on approach when I’m making such a big purchase. I also want to keep the ~25-30K realtor’s commission to myself in the process (~3% of a million-dollar home).

I would like to go Duproprio if possible, but most of the houses I like are sold by realtors. That means if I go it alone, the seller’s realtor end up representing both sides (which is bad for both parties) while getting double the commission.

Other provinces have models where the buyer’s agent offers a flat-fee model or up to 80% of their commission when the buyer does most of the work. From what I researched, currently it’s not a practice in Quebec, and I believe it should be as it will create a more fair market for all. Did anyone work with any realtor who provided such a fee structure? Or know of any that might be interested?


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## Mortgage u/w (Feb 6, 2014)

Flat-fee models don't really exist in Quebec. The most you get is Proprio Direct which is a banner that offers three commission structures: 1 if sold by a collaborating agent, 1 if sold by the listing agent and 1 is sold by the vendor himself.
Stats are clear.....majority of agent listed properties are sold with a collaborating agent.

In any case, why are you questioning the models when you are not the vendor? You are the buyer so you either represent yourself or have an agent represent you. I recommend the latter. Do not look at the commission structure....the selling price will be fair market value......not fair market value + commission.


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## ariadne (Dec 5, 2020)

Mortgage u/w said:


> Do not look at the commission structure....


Well I do look at it because it's a big chunk that the buyer should be able to keep. Don't get me wrong, realtors get their rightful commission for the services they provide (for the people that need it). My problem is this: 

If something at home is broken and I fix it myself, I don't pay anyone for it. If I need a professional's help, I need to pay for it.
If I buy an IKEA furniture and build it myself, I don't pay anyone for it. If I need a professional's help, I need to pay for it.
As a home buyer in Quebec (which is the biggest transaction almost anyone will ever make), if I want to do the work myself... the seller's realtor ends up getting *double the commission*??
I just don't understand how that makes sense.

The real question is, to your point:


Mortgage u/w said:


> Flat-fee models don't really exist in Quebec.


Why is this the case? It's difficult to grasp that there isn't _any realtor_ out there who is willing to change this for a client to get their business?


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## sags (May 15, 2010)

The agents have their brokers to pay, and fees to associations that dictate the commission.

The local agent would only have flexibility on their % of the commission, and they have expenses and want to earn a living.


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## ariadne (Dec 5, 2020)

Fully agreed. So do the rest of the realtors around the world and Canada (Alberta, Ontario, etc). And they’ve realtors that offer flat-fee / cash-back services.

Really it feels like real estate lobbyists made the rules/prospective and set the practices in a way that works for them rather than the people. I simply don’t understand not having the right to buy my own house without a realtor and save on commissions / fees (even partially!)


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## STech (Jun 7, 2016)

ariadne said:


> I simply don’t understand not having the right to buy my own house without a realtor and save on commissions / fees (even partially!)


That's quite the exaggerated statement.

You have the right to offer to buy any house you desire and can afford. You just can't expect the realtor to give you 80% for "doing all the work". 

FYI, It's less work and headache for the relator to deal with a pro that knows the laws, process, and is licensed and insured vs someone that equates buying a million dollar house to assembling Ikea furniture.


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## ariadne (Dec 5, 2020)

Of course. What I’m proposing is this: realtors still deal with one another. I am talking about the commission of my realtor as the buyer. The seller’s realtor of course get their full commission, that’s in their contract. What they do though, is to put a clause that says if the buyer doesn’t have a realtor, the seller’s agent ends up representing both sides and gets the buyer’s commission also. That’s why I’m looking for a flat fee or cash back buyer’s agent (any referrals welcome btw). 

And back to my original question: Why is this a practice in Ontario and other places but not Quebec?


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## STech (Jun 7, 2016)

OK I missed that point. So it's 80% of the 2.5% of the buyer's commission you want given to you. So on a million dollar purchase, you expect your realtor to earn $5,000.

Out of that $5,000 they still have to pay their brokerage, licensing fees, etc. And still have to go with you to the viewings, home inspection/appraisal, still have to do up the offer and deal with the back and forth paperwork, and deal with any fallout if things go wrong.

On a $500,000 home, they'd earn $2,500 before any fee splits with their office or expenses. Does this actually happen in Ontario?


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## ariadne (Dec 5, 2020)

Yep. I updated the original post to include this link as well: https://www.cbc.ca/news/business/re...es-to-woo-do-it-yourself-homebuyers-1.2933534


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## STech (Jun 7, 2016)

Both websites listed in your link are out of business.


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## Mortgage u/w (Feb 6, 2014)

When there is a collaborating agent, the commission is not necessarily double. On average, a standard sellers contract will stipulate that the collaborating agent will receive 2.5% of the commission out of a total of 5%. The 'deal' the seller can get is if there are no multiple offers or collaborating agents and the agent fully represents both buyer and seller, the commission would be reduced to 3%. Not all agents offer this 'deal' but it is fairly common. Anyone signing the contract needs to look at this that their cost will be 5%. Should they agent find the seller, then you can get a 'deal'.

Ultimately, I have said it before - there needs to be an overhaul in the RE pay structure. I believe agents should all charge a flat-fee for their service rather than a percentage. The process of selling a $1,000,000 home is no different than a $600,000 home so the cost should be the same.


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