# Realtor fees - what is typical in BC?



## Young&Ambitious

So, if I'm buying & selling through the same realtor, what kind of rates are typical and to be expected? Apparently Ontario/east coast tends to use a fixed % rate ie. 5% of purchase price, but BC/west coast tends to use a % of first $ (ie. $100k) and a different % on the rest of the purchase price. Also, apparently the realtor will also have a portion of those rates go to the other agent involved as an incentive which I didn't realize. When it comes down to it, I want to know what a competitive rate is basically.


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## dogcom

You could also try one percent realty to get the exposure without the huge commission costs.

http://www.onepercentrealty.com/

Otherwise it can be very costly like 7 percent on the first $100,000 and 3.5 percent on the rest.


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## Just a Guy

It's what you negotiate with your realtor. They will tell you it's 7&3.5, but some will settle for less. You can also negotiate different rates for the listing agent and the buying agent. So, you may offer 3.5&1.75 for the buying agent but less for the listing agent. Some buying agents won't tell their clients about places with lower commissions for them...or so they say. 

It probably depends on the price of the property, and it's situation as well as how well you negotiate.


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## Young&Ambitious

OK cool. It sounds like I'm doing alright then with 7 & 2.5 for the buy and the realtor won't be taking any fee on the sale. Sweet :biggrin:


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## Pigzfly

The seller is the one who pays the fees (though usually that's reflected in the sales price anyway) and it is split between the two agents. Sometimes it's 50/50 split, other times it's not. Depends where you live. In my area it's usually 6% on the first 100K and 3% on the rest. Rates are usually a bit less for houses over a million. On occasion, a realtor will charge a buyer's fee as well. They're usually a few hundred dollars, if they exist at all.


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## mikestewartrealtor

Hi Guys,

We Realtors can't say there is a standard real estate commission because the federal gov't doesn't want to us to create the perception of one set rate. The feds also want consumers to know that real estate commissions in Canada are negotiable.

What we can do is talk about what we individually charge.

I for example charge 7% on the 1st $100K & 2.5% on the Balance.

Here is a link to a commission calculator on my site for reference.

Hope this helps!


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## Hawkdog

Try Property Guys if you don't mind showing your home yourself, they charge about a 500 dollar flat rate for signs and listing on their webpage.

http://propertyguys.com/


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## Homerhomer

You don't need buying agent, how difficult it is to look up mls and than call the listing yourself, then when you are ready to make an offer start at a lower price since the seller is accounting for the buyer commission they would normally pay.

In Ontario you can get full listing broker for 1% or flat fee, then you need to pay the buyers agent (usually 2.5%), you can also list for flat fee without any services provided by broker like property guys or comfree.
Not sure why anyone would still pay the 5% or 7% fees for virtually nothing, I imagine in BC there are also more reasonable options than paying so much money for very little in return.


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## Hawkdog

Ya its unbelievable the cost in BC versus what you get in return.





Homerhomer said:


> You don't need buying agent, how difficult it is to look up mls and than call the listing yourself, then when you are ready to make an offer start at a lower price since the seller is accounting for the buyer commission they would normally pay.
> 
> In Ontario you can get full listing broker for 1% or flat fee, then you need to pay the buyers agent (usually 2.5%), you can also list for flat fee without any services provided by broker like property guys or comfree.
> Not sure why anyone would still pay the 5% or 7% fees for virtually nothing, I imagine in BC there are also more reasonable options than paying so much money for very little in return.


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## mikestewartrealtor

Hawkdog said:


> Try Property Guys if you don't mind showing your home yourself, they charge about a 500 dollar flat rate for signs and listing on their webpage.
> 
> http://propertyguys.com/


Real Estate as with everything else, you get what you pay for...


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## mikestewartrealtor

I meet people all the time who purchased properties without the aid of a qualified and experienced buyers agent. 

In most cases these people over paid for the properties they bought and this could have been avoided had they used the services of a qualified and experienced buyers agent, which in BC involves no cost to the buyer.


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## andrewf

I would amend that by saying you get what you pay for, or less. Often paying more confers little or no additional benefit.

I mean:

http://www.amazon.ca/Listerine-Anti...TF8&qid=1366153756&sr=1-29&keywords=listerine


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## Homerhomer

mikestewartrealtor said:


> In most cases these people over paid for the properties they bought and this could have been avoided had they used the services of a qualified and experienced buyers agent, which in BC involves no cost to the buyer.


Sorry but you are not magicians, with an additional cost that buyer agents are charging it most likely means the actual sale price is higher not lower. Sellers care about net to them, the more is eaten by the fees the more they will demand as a selling price, and it is then built into the mortgage so there is a cost to the buyer.

It would be much easier if no agents were involved at all, with 5% commissions saved on $500K house there is additional 25K room to negotiate the price, which otherwise is wasted on very little service received in return, and quite frankly most often the goal of the service is to close the deal and not to represent the client's best interest.


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## RBull

I meet people all the time that overpay for a home listed with a real estate agent. I also meet people all the time that overpay for selling their home using an agent. In my most recent experience I sold my home for 4.3% higher than the price my " 30 year experienced agent" wanted us to list at....and I also sold it myself for $10K+ less in fees with the "you get what you pay for" service you referred to; and with the buyers being represented by "a qualified and experienced buyers agent". 



mikestewartrealtor said:


> I meet people all the time who purchased properties without the aid of a qualified and experienced buyers agent.
> 
> In most cases these people over paid for the properties they bought and this could have been avoided had they used the services of a qualified and experienced buyers agent, which in BC involves no cost to the buyer.


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## Homerhomer

mikestewartrealtor said:


> Real Estate as with everything else, you get what you pay for...


Thankfully more and more poeple educate themselves about RE transactions and realize that this is not the case. 

Seller.
1) Check comparable sales in the area.
2) Declutter, refresh the house.
3) Post online.
4) Fill out few forms.
5) Do showings.
6) Negotiate.

Buyer.
1) Check comparable sales in the area.
2) Look up mls.
3) Contact seller.
4) Drive to showings.
5) Negotiate.
6) Sign few forms.

To me this is not worth paying tens of thousands of dollars.


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## mikestewartrealtor

RBull said:


> I meet people all the time that overpay for a home listed with a real estate agent. I also meet people all the time that overpay for selling their home using an agent. In my most recent experience I sold my home for 4.3% higher than the price my " 30 year experienced agent" wanted us to list at....and I also sold it myself for $10K+ less in fees with the "you get what you pay for" service you referred to; and with the buyers being represented by "a qualified and experienced buyers agent".



Sounds like it worked out well for you.

For people with a lot of time and not a lot of money this can work. Sometimes. (I say this because like I said above, people come to me all the time after they bought on their own)

For those with the opposite situation (like myself) hiring a pro works far better. People like this are my client base and it works very well for them.


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## RBull

Yes it worked out very well. I always used to think it worked out well before for me using an agent. Then I did it myself and learned how well it really could be. 

Regarding the first part of your comment it took amazingly little time. After some research time I spent about 2 hours with the company to put a listing together, then did 3 showings total , and had 2 offers from that -1 of which we accepted- no conditions beyond an inspection. Probably got paid between $1500- $2K per hour for that "job", and I suspect most anyone in the same situation would be able find the time. 

Not sure what the "people with little money" has to do with *selling* on your own, as a blanket statement. Our home was located in one of the most expensive areas of our city and we probably wouldn't be considered as having little money by most people's standards. From what I can see people at all levels of homes try private selling - the same as use agents. 

In my opinion it really comes down to having a home that presents well in a desirable area that is properly priced. I did my homework, had a professional appraisal and undercut my competition by a slight amount. 

If a person has some smarts and these other favorable conditions they could easily sell their own home with little time and save significant dollars. 



mikestewartrealtor said:


> Sounds like it worked out well for you.
> 
> For people with a lot of time and not a lot of money this can work. Sometimes. (I say this because like I said above, people come to me all the time after they bought on their own)
> 
> For those with the opposite situation (like myself) hiring a pro works far better. People like this are my client base and it works very well for them.


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## andrewf

Only poor people sell FSBO is akin to the argument that only lazy investors use passive index investing.


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## none

RBull said:


> In my opinion it really comes down to having a home that presents well in a desirable area that is properly priced. I did my homework, had a professional appraisal and undercut my competition by a slight amount.
> 
> If a person has some smarts and these other favorable conditions they could easily sell their own home with little time and save significant dollars.


Exactly - although I would add that exposure is needed.

I sold my house private sale in 5 days a couple years back. It was really easy surprisingly. Total time 5 hours of work - saving? about $15K (tax free). One thing that I've learned through all of my real estate experience is that realtors are vastly overpaid for the work they do. A realtor is worth about $1000 a sale and that's about it. sorry but a high school education and a 6 week course isn't worth more than that.


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## RBull

We're on the same page. Yes, exposure is important. For $150 I got mine listed on MLS, for another $150 I got mine on a property guys listing (knew franchise owner).

There are times a realtor may be important ie if your property isn't in a high exposure area, when you need someone to show homes only on MLS etc. 



none said:


> Exactly - although I would add that exposure is needed.
> 
> I sold my house private sale in 5 days a couple years back. It was really easy surprisingly. Total time 5 hours of work - saving? about $15K (tax free). One thing that I've learned through all of my real estate experience is that realtors are vastly overpaid for the work they do. A realtor is worth about $1000 a sale and that's about it. sorry but a high school education and a 6 week course isn't worth more than that.


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## RBull

andrewf said:


> Only poor people sell FSBO is akin to the argument that only lazy investors use passive index investing.


Well put. I thought the original comment was pretty funny.


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## OnePercentWalter

*No need for high commissions*



Young&Ambitious said:


> So, if I'm buying & selling through the same realtor, what kind of rates are typical and to be expected? Apparently Ontario/east coast tends to use a fixed % rate ie. 5% of purchase price, but BC/west coast tends to use a % of first $ (ie. $100k) and a different % on the rest of the purchase price. Also, apparently the realtor will also have a portion of those rates go to the other agent involved as an incentive which I didn't realize. When it comes down to it, I want to know what a competitive rate is basically.


I was a builder and developer in Vancouver for years and was always sickened by the 6 months to a year of back breaking work only to sell the place and hand a check for $50K to a realtor. But now I've gone over to the dark side and become one myself! A lot easier to sell the darned things than buy them  Fortunately though I found One Percent Realty for a brokerage. Flat 1% fee (min. $6,000) plus $900 admin charge. On a typical million dollar home my commission is $10K and not the almost $40K a normal realtor would charge. That's fair and represents good money for my time. Plus I get to offer clients all benefits such as MLS and listing on Realtor.ca. Other agents don't like it when their buyers want my listings but, today, they have little choice and they get half my commission. Almost 80% of our listings are sold by cooperating brokerages


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## OnePercentWalter

*Buyers contracts*



Homerhomer said:


> Sorry but you are not magicians, with an additional cost that buyer agents are charging it most likely means the actual sale price is higher not lower. Sellers care about net to them, the more is eaten by the fees the more they will demand as a selling price, and it is then built into the mortgage so there is a cost to the buyer.
> 
> I think any agent who has a minimum commission stated in his buyer's contract is someone you need to stay away from. When you make an offer on a property are you able to search past sales in the area and determine what market value is? Are you able to write up an offer with subjects that are worded so they will stand up in court if the needs be? If the seller has listed with an agent you are going to be a "customer" when you make an offer and not a "client". He will do everything possible to make your offer worded in the best way possible for his client's advantage and you will be a sucker ripe for the picking. The seller has already paid for you to use an agent so why wouldn't you? And as for commissions pushing property prices higher - you really think that any seller who has a house with market value of say 800,000 is going to reduce the price by $40,000 because he isn't using a realtor? Of course not, he is going to charge the full 800K, make more money, and somehow find the people to pay for it and hope he hasn't screwed the whole process up and finds himself in a real bind.


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## Mechanic

OnePercentWalter said:


> I was a builder and developer in Vancouver for years and was always sickened by the 6 months to a year of back breaking work only to sell the place and hand a check for $50K to a realtor. But now I've gone over to the dark side and become one myself! A lot easier to sell the darned things than buy them  Fortunately though I found One Percent Realty for a brokerage. Flat 1% fee (min. $6,000) plus $900 admin charge. On a typical million dollar home my commission is $10K and not the almost $40K a normal realtor would charge. That's fair and represents good money for my time. Plus I get to offer clients all benefits such as MLS and listing on Realtor.ca. Other agents don't like it when their buyers want my listings but, today, they have little choice and they get half my commission. Almost 80% of our listings are sold by cooperating brokerages


I'd be dealing with this guy or a similar operation in the area I am in, if I were looking to sell. The typical 7 & 3 deals I hear all the time are ridiculous but it surprises me how many people are still paying them. The house we bought we put in an offer on the first day on the market and the seller paid close to $40k in commission. We would have still made an offer no matter who's sign was on the pole as we liked the area and the house. Also, never sign an exclusive representation deal if you are a buyer, not all agents make you sign them and it limits your options as a lot of the pricey agents will steer you away from deals paying a lower commission to them.


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