# Realtor fees



## fifi

Hi all,
Living in Calgary, we're looking to sell our home, which will prob sell in the range of 480/490k. Our potential realtor said that realtor fees would amount to approx 18,000. Does this sound right? Should I be looking to reduce this amount/look elsewhere? Yes, the realtor is helpful, hard-working, etc, just not sure if I should start bargaining it down before signing anything or if this is reasonable (and looking to you all for a 2nd opinion!)

I'm not looking to re-ignite or contribute to the ongoing debate of whether a realtor is useful or not, just want to know if this is high, low or average!

Thanks everyone,
fifi


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## GeniusBoy27

Usually, it's 5% of the selling price. It sounds like you're getting 4%, which is below the norm.


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## the-royal-mail

It's strange that you were told the fees in terms of $. Usually they are expressed to you in terms of %. And the norm is 5%. Less than that, you are getting a bit of a bargain. I doubt you'll find someone that will go less than 4%.


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## fifi

Nothing formal has been set yet, but we did ask him what the fees would amount to, so that we could calculate what kind of home we wanted to afford. We haven't gotten into percentages, etc, but he did say on a sale of between 480 and 490k (which sounds fair considering recent comparable sales and the shape of the house) they'd amount to ~18k. It's in an email, so I'd hold him to that...
Thanks to those who have responded; so far it sounds like people think it's a "reasonable" realtor fee....


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## Jungle

fifi said:


> Nothing formal has been set yet, but we did ask him what the fees would amount to, so that we could calculate what kind of home we wanted to afford. We haven't gotten into percentages, etc, but he did say on a sale of between 480 and 490k (which sounds fair considering recent comparable sales and the shape of the house) they'd amount to ~18k. It's in an email, so I'd hold him to that...
> Thanks to those who have responded; so far it sounds like people think it's a "reasonable" realtor fee....


Their labour/time does not equal $18,000, but unfortunately, that's what they get away with. It's legal robbery.


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## Cal

I know alot of people are upset with realtors fees...but has anyone done 'for sale by owner'...i have heard it costs about $500...but I don't know anyone who has done it.


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## Maltese

Cal said:


> I know alot of people are upset with realtors fees...but has anyone done 'for sale by owner'...i have heard it costs about $500...but I don't know anyone who has done it.



I've used Comfree here in Manitoba with great success. Initially my condo was listed with a realtor who didn't sell it. I got fed up and hired Comfree to erect the sign and give me the seller's package that included a few offer to purchases.

Now I'm in a house and my ex next door neighbor sold his house in just a few days using Comfree.


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## kcowan

Get some clarity on the fee. Is it a % of the total selling price? If not, why not?


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## Racer

In Alberta, realtors usually charge 7% on the first $100,000, and 3% on the balance (I think).

If you want to cut the commission fees and don't mind the extra work/learning, there are a number of alternatives.

ComFree, of course, but also --
-http://www.propertyguys.com/

-http://www.sellerinvite.com/sell.php

-http://www.twopercentrealty.ca/

One of the advantages a realtor brings is the AREA contract. It is regularly updated and revised, with input sought from lawyers for the banks, real estate brokerages, and of course real estate lawyers who see the difficulties that have arisen from the wording of the older versions. It's meant to sort out rights and obligations for all of the involved persons - the parties, their lawyers, their agents. You can purchase a copy of the AREA contract (realtors won't give out their copies - I learned this as an eager student buying my first hourse, when I wanted to learn *everything*  ) from here: http://www.lesa.org/comersus7f/store/comersus_viewitem.asp?idProduct=34153686

Good luck!


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## fifi

kcowan said:


> Get some clarity on the fee. Is it a % of the total selling price? If not, why not?


It was just an informal email telling us about general expenses, saying it would amount to approx 18,000. Yes, when it comes to the nitty gritty, I would get clarity on it of course. 

Thanks everyone so far for the advice; valuable stuff for sure.


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## informer

*Save on Fees*

I had a coworker use sellerinvite.com and he discovered they're not actually a fsbo company but a full blown real estate brokerage they're just cheaper. They sold really quick and said they were very different so he was extremely happy...I'd check them out.


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## mrbizi

If you are buying a house as well, ask the realtor if he will give you a rebate if you use him as your realtor to buy the house. This will be applied to the payable commission, typically .5% of the price of the house that you are buying.


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## andrewf

Racer said:


> In Alberta, realtors usually charge 7% on the first $100,000, and 3% on the balance (I think).


Backwards incentives. The agent has incentive to sell quickly, for a below-market price.




> You can purchase a copy of the AREA contract (realtors won't give out their copies - I learned this as an eager student buying my first hourse, when I wanted to learn *everything*  ) from here: http://www.lesa.org/comersus7f/store/comersus_viewitem.asp?idProduct=34153686


They wouldn't give you a copy of a contract that they expected you to sign?


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## MoneyGal

andrewf said:


> They wouldn't give you a copy of a contract that they expected you to sign?


You don't sign it. It's the organizing contract for realtors operating in the province. A client asking to sign it would be like a client asking to sign the mutual funds licensing agreement which sets out the responsibilities for the bank MF salesperson.


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## JA2285

andrewf said:


> Backwards incentives. The agent has incentive to sell quickly, for a below-market price.
> 
> 
> 
> 
> They wouldn't give you a copy of a contract that they expected you to sign?



Yes. Thats exactly how they work. I haven't seen any BC or AB Realtor that do a flat % aside from those 1% realty types. Even with a flat sales commission, whats a couple percent on a 500K house anyways.. Any Realtor is going to take the deal aslong as the seller accepts.

I don't think there any one real commission system that will work favorably for a seller or fairly for the both of them.


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## m3s

andrewf said:


> Backwards incentives. The agent has incentive to sell quickly, for a below-market price.


haha exactly

It should be 1% on the market value, and 7% for anything above... They don't have to work for the first 100k lol


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## tobuyornottobuy

*fees*

I find it so expensive to sell here. 7% on the first 100 , then 3% after (roughly)

in the UK I pay 1.25%- 1.75% of the selling price.

I'm just not sure what the realtors are doing here to justify that sort of money!


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## andrewf

Yes mode. I would offer perhaps a flat rate plus a substantial percentage of any premium over market value. RE agents are salespeople. They only create value when they sell something for more than what any monkey could sell the property at. If they can fetch above market value, they deserve to be well-compensated out of the value they create for the seller.

I also have a problem with the seller paying the buyer's agent. Isn't that like trusting the salesman at the car dealership to act in your interests?


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## jamesbe

It's a messed up system. 5% made sense when the average home was $100k...


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