# In Defense of Realtors



## Racer (Feb 3, 2010)

Now I know that realtors have a bad rep with the members of this forum... and a lot of the concerns are legitimate, IMHO. When the deal is made quickly and easily (generally attributable to the miracle known as MLS.ca), the realtor pulls in a lot of profit without breaking a sweat. The commission structure varies from province to province, but usually incents the realtors to ensure that the house sells, period -- not necessarily selling for the best possible price.

But from the other side of things, I have seen realtors works their keesters off during a difficult closing. Cell phones ringing in the middle of the night, juggling multiple offers, dealing with demanding clients... it can be a tough business.

I have been dealing with a lot of private sales lately -- where the buyers and the seller have "sort of" hatched out a deal and come straight to the lawyer. They have been so difficult that I am considering referring these clients to another lawyer, or else insisting that they work with a realtor to put their contract (conditions and deadlines) in place, handle deposits, and release the keys. And if I see another self-drafted contract, I think I might just starting sneaking booze in to work. 

So anyways, I came across this video and thought it was a hoot. Some language is offensive. Enjoy!

http://www.youtube.com/watch?v=WK_MErZfH0s


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## Berubeland (Sep 6, 2009)

Very funny... 

I too have had conversations with homeowners wanting to rent out their place very similar to that  

No pets, no smoking, no kids, no visitors, no noise, no parking, female 45-60, working professional. 

Or my favourite wing ding landlord of all time... please find out when and where they were born so I can do an astrological chart and determine if they will be good tenants.


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## m3s (Apr 3, 2010)

The video was funny from a realtor's point of view but they still charge too much for what they do. It's not my fault they have ridiculous overhead fees to pay

They don't always even look out for their clients as closing deals fast always benefits them. I'm sure their loyalties often lie with their coworker who represents the opposite side of the deal

I think there is still a place for realtors but people should be free to see all current houses for sale, price histories and advertise online themselves is this day and age



> And if I see another self-drafted contract, I think I might just starting sneaking booze in to work.


So you're a lawyer who hates to write contracts? Isn't that what you're being paid for, to help your clients with legal binding papers..


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## Jungle (Feb 17, 2010)

Funny Video. It says episode 1, is there another video?

There is no value in the prices Realtor's charge to sell a home. Because of the all mighty MLS, they have the market in a choke hold. This is the ONLY reason why they get away with it. They can claim to do this, know that, ect, to make you believe paying $15,000 is worth their service. Then there is a conflict of interest to the buying agent: give them less than 2.5% and they will not visit your home to buy. It's a big miss and I wish the GOV would step in already. This is abusive towards homeowners. 

I might look into one of those $299 full service listing add next year. Sounds about right price to post on a website, answer phone calls and fax a pre-made, paper offer.


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## Four Pillars (Apr 5, 2009)

In all fairness, I think it's the real estate brokerage companies (Royal Lepage etc) that run the show. They set the commissions and dictate how the agents can work.

Regardless, it still sucks.


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## DavidJD (Sep 27, 2009)

If MLS access is successfully challenged by the For-Sale-By-Owner service package providers (Comfree and the like), then the MLS will end up just like putting your house up on Kijiji. Re/max, RLP C21 and all the others large brokerages are not going to cooperate. What will happen is the large companies will create an exlusive database and share amongst themselves - exluding FSBO's. The real victim will me be the thousands of independent brokerages with a handful of Realtors and a tiny market share (yet with a loyal and well served client base). Where the big 3-4 companies already occupy 60% of the market share, the selection of brokerages to list with will be reduced significantly. The larger brokerages will swallow their market share. This will not serve the public better than today.

And if you want to list or sell a home in the powerful, exclusive database, your choice is narrowed and the fee, will be the same if not higher.

Thoughts?


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## MoneyGal (Apr 24, 2009)

This blog post encapsulates some of the issues for me: 

(Disclaimer: not my blog post, and not a neutral point of view)

http://www.movesmartly.com/2010/03/competition-in-canadas-real-estate-industry.html

From the post:

_One positive outcome of the Competition Bureau’s actions is that it could allow brokerages to offer a service to consumers (in this case, a flat fee posting service) that CREA currently prohibits them from offering. But there are many restrictive rules that prevent brokerages from offering innovative services of value to consumers and the Competition Bureau isn’t doing anything about one that really matters.

In order for flat fee brokerages to flourish in Canada they would need to follow the lead of the US model I just described above.

Unforunately Ontario’s Real Estate and Business Brokers Act (REBBA) has a clause that effectively makes it impossible for flat free brokerages to operate this way in Ontario. Section 36 of the Act states:

All commission or other remuneration payable to a brokerage in respect of a trade in real estate shall be either an agreed amount or percentage of the sale price……but not both….

The Act does not allow a brokerage to charge a flat fee for the listing portion of the commission and at the same time offer a 2%-3% commission to the buying agent. So if the listing brokerage wants to charge a seller a flat fee to sell a home, it has to limit the buying pool for that home to buyers without an agent or those with agents who are also charging a flat fee. This is a very small pool and as such guarantees any brokerage trying to implement a flat fee model in Ontario to a prohibitively rough start.

To be effective, a brokerage needs to be able to charge a seller a flat free without prejudicing the type of buyer they are able to work with. Until the Province of Ontario reviews the Act accordingly, consumers won’t benefit from the most effective flat fee brokerage model._

There's more interesting stuff in the post; a recommended read.


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## rookie (Mar 19, 2010)

OP, am guessing you are a lawyer.

here is my take. its not just the realtors that make more than what they deserve, the lawyers job is also relatively painless when they get well templated documents, although the fee they charge can be justified to some extent. 99% of the cases, the lawyer just reads through the customized template document and signs off and makes an average of 1.5k. the fee involves about 1 hour of meeting the client and 1 hour of going through the document. thats a massive 750$ per hour.

you say you are having to do more work with private deals, but isnt this what the lawyer is actually paid to do? i think with this the lawyer really "earns" his money. but its probably not a long time away for lawyers to have templated documents for such private sales as well!!!


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## MoneyGal (Apr 24, 2009)

Have you guys ever worked in a customer-service-oriented industry in which you as a professional are professionally liable for advice given? There's a lot more to it than "just reading through" a document and signing off.


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## andrewf (Mar 1, 2010)

David: I think if the big brokers did that, they would run into the same antitrust issues they are now with MLS.


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## rookie (Mar 19, 2010)

MoneyGal said:


> Have you guys ever worked in a customer-service-oriented industry in which you as a professional are professionally liable for advice given? There's a lot more to it than "just reading through" a document and signing off.


i understand that. that is why i said 99% of the cases. maybe i am wrong about 99% but i am sure i am not very far off. if i am wrong, can you please educate me on what exactly does a lawyer do when he gets a well templated agreement? exactly, what kind of advice does a lawyer dispense? i dont recall getting any advice.


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## DavidJD (Sep 27, 2009)

andrewf said:


> David: I think if the big brokers did that, they would run into the same antitrust issues they are now with MLS.


But it would be harder to pursue through the courts, first because they gave up the MLS - they are not obligated to use it are they? If they want to have an internal listing database for their company, that is their legal right. To offer an exchange of database content to other cooperative companies, so be it.

We'll see.


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## Four Pillars (Apr 5, 2009)

> All commission or other remuneration payable to a brokerage in respect of a trade in real estate shall be either an agreed amount or percentage of the sale price……but not both….


Couldn't the selling agent just set an "agreed amount" for the other agent which will correspond to the desired percentage? Ie if the house will go for roughly $400k and most buying agents will expect 2.5% then the guaranteed amount for the buying agent would be set to $10,000.


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## kcowan (Jul 1, 2010)

Realtors are like any other commissioned sales people. During the good times, they may not earn their money but during the tough times, they really have to scrap for every nickel. I have had good success dealing with realtors.

I have also observed my share of questionable behaviour. And I could make a humourous video illustrating those behaviours.

There is a bell curve at work. The question is: Does the median realtor do a professional job during a median market condition? I think the answer is yes.


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## MoneyGal (Apr 24, 2009)

Well, I think the 99% estimate is a little high - but I'm neither a lawyer nor a realtor (but I've bought and sold my share of houses). 

If you don't need advice, presumably you don't get any; I'm not sure that's a good way to judge whether you are getting value. 

What you DO get, though, is insurance against error, because someone else is taking on the liability for ensuring the transaction is kosher. 

As a side note: in my view, this is why the stand-alone fee-for-service financial planning model will never really take off in Canada. The real money in managing money is the ongoing annuity: the up-front, one-time cost of preparing a financial plan exposes the FP to total liability for a very limited return. It isn't really a workable business model unless combined with money management.


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## m3s (Apr 3, 2010)

rookie said:


> OP, am guessing you are a lawyer.
> 
> you say you are having to do more work with private deals, but isnt this what the lawyer is actually paid to do? i think with this the lawyer really "earns" his money. but its probably not a long time away for lawyers to have templated documents for such private sales as well!!!


This was my question as well

I'm sure there is more to it than I see.. but come on there are only so many blanks to fill into a template. You're worse than the realtors if you expect to get paid thousands to sign contracts


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## GeniusBoy27 (Jun 11, 2010)

It's easy to say that "lawyers" or "real estate brokers" aren't worth their fees. However, if the market and fair competition exists, then we can deem on an individual basis what is "fair market value."

I don't think lawyers are overly paid for their transaction on real estate (no matter how much I grope), because they do incur high risks if things aren't done properly, and they do have to do due dillegence on land-transfer of the property. It does take time to do this properly (even with all the templates, etc.) 

I feel the same thing for real estate brokers. It's not easy. My wife probably saw 700 properties, before we bought our home ... the real estate agents went batty. So it's not easy for some people. So not everything is straight forward, up-front profit. Sometime it does take time to buy a place and find something that you truly want,and so there are incurred costs. Do the real estate agents really deserve 5% on each transaction. Maybe not. But then again, maybe they really do. I say, open the practice. Make it transparent, then determine what's fair.


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## Four Pillars (Apr 5, 2009)

The difference between real estate agents and lawyers (as my lawyer likes to point out) is that the lawyer will charge a set fee for services. The agent will charge a percentage of the sale value even thought the amount of work for an expensive house is the same as for a cheap house.


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## m3s (Apr 3, 2010)

GeniusBoy27 said:


> I feel the same thing for real estate brokers. It's not easy. My wife probably saw 700 properties, before we bought our home ... the real estate agents went batty.


For people like me a % based is a rip off. I knew what I was looking for and bought a house after seeing a few that I narrowed down to myself. Same way I don't waste people's time when buying used cars. I'm there to see the specific vehicle, not to decide it it's the model I want or if I can afford it etc


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## Berubeland (Sep 6, 2009)

The initial complaint brought before the Competition Bureau was by Realty Sellers. Their MLS access was cut off for... listing all MLS listings for sale on their website. Which if you know anything about websites would have trashed all the other lame realtor sites that only include their own listings or even the Realtor.ca site which considered an advertising site by agents. Great deals are left on there long after they close yet never even made it on the site before they sold. 

Particularly telling about agents and their supposed ethics was a memo passed around by CREA a while back telling agents that they HAD to show low commission listings as part of the measures implemented as a result of the Competition Board. So the reason that high commission brokers sell more houses is because of the collusion that goes on. 

I don't hate real estate agents, but I hate the lies they try to pass off as truth, we're so professional, we're so essential, we are liable, when most of those things are untrue. 

Less than a month of school does not make you a professional
Showing and selling a house does not make you essential
Filling out an agreement of Purchase and Sale is not rocket science.
The lawyers are the one who do the heavy lifting where the liability is concerned. 

Do agents provide a service that should be compensated? Yes

I think a serious amount of attention should be paid to the entire house selling system as it exists in Canada. 

The amount of fees that agents (these are the guys who actually do the work) pay to their brokers and to essential memberships should be seriously examined. I don't blame realtors for being upset. The agent I did an internship for even had to pay her broker to use the logo on her business card, desk fees, phone fees the list went on forever. Basically she was really broke after everything. So when you tell these poor guys being leeched at by every single level of the business that they aren't going to get listing commissions of course they're really upset. 

You can't point to a very tiny minority of people who make millions and say realtors all do well. Any industry that churns the amount of people through their ranks like real estate does really need to reexamine their hiring practices. Most agents don't do well and most quit long before the 5 year mark. This has nothing to do with skill set either, it seems to me that only the most predatory survive. 

This is an industry that skims 4-6% off 90% of every single house sale in Canada. This is terrible for consumers and hard working homeowners. 

But the video was still funny 

I too work for commission, I empathize with realtors troubles in many ways, but unfortunately there is no powerful cartel of 96,000 leasing agents to back me up. My service does add value for many people but I'm not delusional about how important I am not do I have to make specious claims about why my service is good for some people.


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## bean438 (Jul 18, 2009)

GeniusBoy27 said:


> It's easy to say that "lawyers" or "real estate brokers" aren't worth their fees. However, if the market and fair competition exists, then we can deem on an individual basis what is "fair market value."
> 
> I don't think lawyers are overly paid for their transaction on real estate (no matter how much I grope), because they do incur high risks if things aren't done properly, and they do have to do due dillegence on land-transfer of the property. It does take time to do this properly (even with all the templates, etc.)
> 
> I feel the same thing for real estate brokers. It's not easy. My wife probably saw 700 properties, before we bought our home ... the real estate agents went batty. So it's not easy for some people. So not everything is straight forward, up-front profit. Sometime it does take time to buy a place and find something that you truly want,and so there are incurred costs. Do the real estate agents really deserve 5% on each transaction. Maybe not. But then again, maybe they really do. I say, open the practice. Make it transparent, then determine what's fair.


They are not worth the fees. ANy lawyer in real estate or estate planning, divorce etc, work off templates. A house is a house is a house. 

Most of the transactions are much the same.

There is no such thing as fair pricing and competition. Actually it works in reverse. The market charges what ever people will pay. ONe guy raises prices, then they all follow suit.

Go to any lawyer, doctor, dentist, vet, what ever, they all have signs that read some thing like:

We charge in accordance with the "whatever federation association" guidelines. In other words price fixing.

Not happy and want to excersise your right as a consumer? Go ahead. The competition will be charging the same.

I hate lawyers and real estate agents. 

They are bottom feeding, scum sucking parasites.


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## bean438 (Jul 18, 2009)

I forgot to add in defence of the real estate agent (can't really believe I am defending) I watched the video and I can sympathize in that there really are unrealistic people out there that can cause headaches for agents.

But I sold my 1st home through an agent. Sure we met, and he took some pretty pictures with a digital camera and printed up some sheets on the laser printer.
But my house sold in 4 hours. 12K for 4 hours (Ok so maybe another 4 hours to do the printing, etc) seems a bit steep.


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## DavidJD (Sep 27, 2009)

Like all services - when you need them they are a blessing. I like the idea of a tow-truck driver who we all hate when are car is towed on a busy street but want to give him a hug for pulling you out of the ditch.

Lawyers and Realtors are the same. When a deal goes smoothly everyone is a critic of the fees. That is what you pay them for - a smooth deal. When I was a Realtor I saved so many clients worlds of pain and suffering, appearing in court and other things are a part of some deals. Also when a Realtor makes an error (took a vendor's word for something) the other party will sue and the vendor is grateful he is shielded by the Realtor's Errors and Ommissions insurance. When a deal goes south, the lawyers can come in pretty handy.

I agree that lawyers should be penalized and worse for having effeciently run offices, they should be disorganized and slow and charge much more for that level of service. It would make some feel like they are getting more attention and therefore more value for the costs?

Every real estate transaction is unique and anyone involved in the industry knows of plenty of horror stories.

I recommend Comfree to everyone so long as you remember you might get what you pay for...or paid peanuts for.

When the markets are not like today, and those days will return, the marketing skills of a realtor can make some families on the brink of bankruptcy get back in the game.

The good thing to remember is no one has to use a Realtor, or pay for one's fees. Also a Realtor does not have to volunteer their services to anyone.

Owners - sell as you please and pay yourself. Why grumble?


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## bean438 (Jul 18, 2009)

With a tow truck driver you are getting something for your money.

WHen a lawyer rams your paperwork through land titles he is using a standard form that they simply change the names. They do this many times. Actually it is the para legal who does the work, and the lawyer signs off.

Com Free is the way to go. A house will sell itself if it is priced right.

Besides when I want to sell a home a need someone to buy it, not sell it.

Things go south? Agent has nothing to do with you after the sale. 

Even if you have an issue good luck trying to collect. 

Sell your own home and pay the lawyer for the paperwork that you have to pay for even if you use an agent.


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## JayRoc (Apr 4, 2009)

Grapevine and Comfree are the way to go...real estate agents in my opinion are not worth anything near the commisions they charge. They in fact try to drive the market higher and higher (it's in their best interests to do so, no?) by trying to create bidding wars/etc.


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## m3s (Apr 3, 2010)

Naw I think the real reason the market gets so high is people's willingness to accept insane mortgage debt. Homeowners want to hold out for the best price possible themselves but if people didn't buy, they would lower their price eventually

A smart real estate agent will actually try to make the sale happen quickly. Holding out for months might benefit the seller for $20k, but 2 months of waiting is Not worth the extra commission on $20k

Studies show that real estate agents on average take longer and sell their own homes and make more profit on real estate than their clients (freakonomics)


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## GeniusBoy27 (Jun 11, 2010)

Maybe the valuation is a little different, but a good real estate lawyer makes anywhere between $300-$600/hour in Toronto. However, a lawyer sets their own rates. Lawyers do not belong to a "federation association". They have no federation. The bar association? That's to regulate licensure.

If something goes wrong in a land deal, real estate lawyers can get sued into the millions. That's what real estate lawyers' malpractice insurance are quite high. It isn't when transactions go smoothly that you cared that you had a good real estate lawyer, but if real estate transactions go badly, guess what? You have a mechanism to rectify things.

I'll give you an example. A vendor was trying to sell me commercial space via a real estate agent, and made a claim that an area behind the wall was our space. i.e. separate office space was combined, and then repartitioned. My lawyer in his title search recognized that the space that was claimed to be part of our unit, wasn't part of the unit. How much space were we talking about? 15%. What was it worth to our original selling price? 15%.

My lawyer's finding saved me much more than his fee (or 20 fees).

I think people hate paying lawyers in general. However, when things go wrong, and you need help rectifying the situation, everyone goes ... "where can I get a lawyer? Especially cheaply".

Well, you sometimes pay what you get for.

On real estate brokers, the thing you have to remember is that most real estate brokers are part-timers. The average real estate broker sells 4 houses (that's the median) a year in Canada. So what it means is the reality is a few brokers sell a lot of houses and make a fair bit of money. Because of CREA's control of information (i.e. the limited information through the websites), and by forcing people to use their system, they've performed unfair competition practices. The Competition Bureau essentially forced CREA's hand into allowing competition.

Like the US, with time, this will lead to appropriate tiering of prices for services and probably lower real estate agents' fees. However, it's a balance of costs versus benefits. Are you willing to pay the 5% to get the services of a realtor, to do the showings, etc? Could you Or do you want to save the money and do it yourself?

Would you say it's okay if you couldn't sell your home, and you had a new home in place?

My point is it's easy to complain when things go smoothly, but when things don't, the other side sure looks greener. But you're free to choose, what works best for you.


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## DavidJD (Sep 27, 2009)

mode3sour said:


> Studies show that real estate agents on average take longer and sell their own homes and make more profit on real estate than their clients (freakonomics)


The mother of a friend of mine found a lump on her breast. Her husband is a pathologist and by afternoon the next day the biopsy result showed that it was benign. Who gets that kind of health care service? 

If you are a Realtor and know how to sell and market your home you will do a fine job working for yourself. You will probably take your own advice.

I loved having doctors as clients when I was a Realtor. I remember explaining a situation and making a recommendation and the Dr. cut me off and said, "This is what I am paying you for, if that is what you recommend, do it." During our conversation he said he would not expect a patient to look at the prescription he just wrote and tell him, 'No, I want 15 mgs and I want to take it only once a day for 5 days instead of 12.' He would recommend they see another doctor.

Many times my advice was not taken and I too suggested that my services are no longer of use and we parted ways. Often I would get a bottle of wine or basket sent to my office weeks or months later with a note saying that they wish they had listened to me, I was right aftera all, and they have recommended my services to their friends, families etc. 

I have no idea why so many of you grumble about Realtors and lawyers. You can do it all yourself and no one has a gun to your head insisting you use their services.

I think the rates charged for financial advising, planning or whatever are outrageous SO I DON'T USE THEM OR PAY FOR THEM. So why waste my time complaining about it? I feel the same way for naturopaths, chiropractors, and astrologers.


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## the-royal-mail (Dec 11, 2009)

David, I understand what you are saying and I agree that these folks are providing a service that is valuable to a lot of people. I think consumer attitudes about these services changing. Housing has increased in value significantly over the past 20 years and the RE agent collects 5% no matter if it's a $30K house or a $300K house. The effort is the same as far as the coordination they do. There is also comfree and the Internet that didn't exist 20 years ago.

I disagree that we're wasting our time complaining as this is an issue that most of us are quite passionate about. Someone started a thread and I think we're having a discussion, in the spirit of the forum.


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## Berubeland (Sep 6, 2009)

I did a post about this very topic. 

http://landlordrescue.ca/wordpress/1-reasons-to-use-a-real-estate-agent/


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## DavidJD (Sep 27, 2009)

the-royal-mail said:


> Housing has increased in value significantly over the past 20 years and the RE agent collects 5% no matter if it's a $30K house or a $300K house.


The crux of the argument is that home sellers _should_ consider negotiating their Realtors' fees as a flat rate rather than a percentage of sale price. 100% agreement on this.

I wonder if this would work for financial planners; to charge a flat rate regardless of the value of the account and their performance/results. It is hard to justify paying a 1.5% fee of the total account value when it tanks 4% over the course of a year. Especially if the account is seven figures.


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## rookie (Mar 19, 2010)

GeniusBoy27 said:


> Maybe the valuation is a little different, but a good real estate lawyer makes anywhere between $300-$600/hour in Toronto. However, a lawyer sets their own rates. Lawyers do not belong to a "federation association". They have no federation. The bar association? That's to regulate licensure.
> 
> If something goes wrong in a land deal, real estate lawyers can get sued into the millions. That's what real estate lawyers' malpractice insurance are quite high. It isn't when transactions go smoothly that you cared that you had a good real estate lawyer, but if real estate transactions go badly, guess what? You have a mechanism to rectify things.
> 
> ...


Mr Genius,

but thats his job. to find stuff like that. just because that saved you more than his fees doesnt justify his fee!!! a dentist saves you a tooth by filling a cavity and charges lets say 200$. lets say you value that tooth at 10000$, should you pay him 8000$???

another thing about liability. first of all they are liable only if they are derelict of their duty, dont do their job. of course they have to be. who is not liable? what about a truck driver? he could get sued for million too. doesnt mean he can charge 500$ per hour. also, they buy insurances to cover their asses and in reality we are paying their premiums and a lot more than that. 

generally, i think the fee any service is charged, is based on how much time and effort went into getting a license/certificate to provide that service. its damn hard and expensive and time consuming to become a lawyer, doctor etc and hence they charge high fee for their services. just like berubeland was saying. Realtors are the only ones who can finish up a course in a month and still charge such a high fee. IMHO, the realtor fee should be tiered. buyer pays buying agent fee and seller to the selling agent. terms should be agreed upon based on time and effort. for example, you pay tiered fee if you buy a home in <50 showings, 50-100 showings, 100-150 showings etc. similarly, selling agent should get a certain fee if he sells within a week between certain price ranges. the terms and the numbers should be agreed upon. i have no clue or cannot find a logical reason why this has to be % based!!!


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## m3s (Apr 3, 2010)

DavidJD said:


> I loved having doctors as clients when I was a Realtor. I remember explaining a situation and making a recommendation and the Dr. cut me off and said, "This is what I am paying you for, if that is what you recommend, do it." During our conversation he said he would not expect a patient to look at the prescription he just wrote and tell him, 'No, I want 15 mgs and I want to take it only once a day for 5 days instead of 12.' He would recommend they see another doctor.


Whoa you're comparing a Realtor to a Doctor? Doctor's are obviously professionals and it takes them a long time to achieve that job.

Doctor's don't have the huge conflict of interest that Realtors do

No way I would let a Realtor just do whatever they want without question! Realtor fees are negotiable to an extent

On a side note I always google what doctor's tell me, and they aren't always as perfect as you may think. Once I had to see several different doctors before one of them told me exactly what I read on Google a long time ago. They're like Realtors in that they have information you don't (Realtors have purposely protected additional info to increase their importance) From nurse friends I know they can't stand people who "self diagnose" on google. I always just do it for comparison and act as if I know nothing. While I respect that Doctors have a ridiculous amount of knowledge, there's no way they always have the perfect answer they always seem to. How many times do you go back to a doctor to try something else? They work by trial an error even when the information is there


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## DavidJD (Sep 27, 2009)

mode3sour said:


> Once I had to see several different doctors before one of them told me exactly what I read on Google a long time ago.


Well I encourage anyone to seek out as many different opinions until they are told what they want to hear. If you are up for murder one, don't bother with a lawyer, or the cheapest lawyer, represent yourself and you should be in good hands.

An important distinction between all the examples of profesional services is; one category is sales (Realtors) and all the others are not.

"If it was so easy everyone would be doing it." When I got my RE licence, I was told that 85% of us taking the courses would be out in less than 3 years. For some reason you are not seeing the grass any greener and must appreciate that as a profession - it ain't so easy. The Realtors who make money at it work their asses off - that is why I quit. It was not worth the amount of work or the aggravation from the odd client who knew eveything and ended up blowing great deals because of their stupidity, btw 6% of nothing is still nothing.

The most successful Realtors know who they can help and who they should wish the best of luck and not waste any energy. That is a skill that takes experience.

Anyone can (legally and realistically), and should sell their own house. No experience is necessary but believe me, it can pretty damn useful.

Clearly you would not need to work with a Realtor. An experienced Realtor would likely rather just wish you the best of luck.


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## Larry6417 (Jan 27, 2010)

I'm agnostic about realtors. There's a wide range of ability. The first realtor I used to buy my present home was a friend of a friend. I didn't check her background - big mistake. She constantly forgot my number (and had to ask my friend for it over and over), she forgot other important info I'd told her, and when she negotiated she advised me not to counteroffer because it might "offend" the sellers! I fired her and retained another realtor, who was quite good.

I think realtors offer a service. It's up to individuals to decide if that service is worth the fee. If not, then negotiate for a lower fee or use a different service.


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## GeniusBoy27 (Jun 11, 2010)

I am going to quickly comment on real estate lawyers. My point from the expense side of things of the lawyers wasn't that they saved me money. It was that their services are far more valuable than just filling contracts on templates. A good real estate lawyer understands where flaws can occur in the transaction process, and can identify issues that extend what we believe to be common sense.

For example, detecting a city easement for the common sewer pipe, or the right of way for water, etc., or that 1840 law in Georgian Bay that takes the frontage away from your cottage. The value goes beyond the simple transaction if you have a good lawyer.

If you want a cheap lawyer to do the simple transaction, that's possible, but sometime you want more.


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## Berubeland (Sep 6, 2009)

I was working for a retiring real estate lawyer a long time ago. I had to move all his files to a secure storage. One of the things you pay for when you hire a real estate lawyer is keeping your information on your real estate transaction for 25? Years. I'm not sure if digital copies are ok. 

It's a pretty big deal when you consider the sorting, moving, storage they have to do. This obviously adds to their expense of doing business. 

We moved over 100 filing cabinets for him.


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## Racer (Feb 3, 2010)

mode3sour said:


> So you're a lawyer who hates to write contracts? Isn't that what you're being paid for, to help your clients with legal binding papers..


Oops, sorry for bad phrasing. I meant that sometimes people try to draft their own contracts, and then bring it in for conveyancing. It probably comes from the perception that conveying a property is just a rubber-stamp process. 



rookie said:


> OP, am guessing you are a lawyer.
> 
> here is my take. its not just the realtors that make more than what they deserve, the lawyers job is also relatively painless when they get well templated documents, although the fee they charge can be justified to some extent. 99% of the cases, the lawyer just reads through the customized template document and signs off and makes an average of 1.5k. the fee involves about 1 hour of meeting the client and 1 hour of going through the document. thats a massive 750$ per hour.
> 
> you say you are having to do more work with private deals, but isnt this what the lawyer is actually paid to do? i think with this the lawyer really "earns" his money. but its probably not a long time away for lawyers to have templated documents for such private sales as well!!!


When a client comes in with a buyer in place, but no contract in place (or the contract isn't solid enough to convey the property with), and the "deal" falls apart without getting to the conveyancing stage, the lawyer still gets paid whatever fees were quoted for drafting, etc. The realtor would have been paid nothing. Solicitors aren't usually prepared to handle major issues on short notice unless they have the support of a large firm, and they aren't focused on getting the deal done - they inform the client of risk and answer legal questions. Most of the time that doesn't seem to "help" the client, because real estate really is full of risk.

The clients never see virtually anything that happens on a RE file. The appointment is just to get their irrevocable permission to move on to closing and sign some other papers. 

I think lawyers are generally overpaid for what they do, but RE is often challenging, at least when working for the buyer who is putting on a mortgage. The banks require the firm to give a solicitor's opinion that the title is "good and marketable", which is not that easy if you are dealing with a CMHC-insured condo, or when the documents aren't in order. Eg, when a condo corp estoppel certificate that isn't clear enough. Or condo bylaws that would hamper a lendor's interest by preventing the lendor from stepping into the owner's place in the event of foreclosure (ie, if voting by proxy is prohibited). 



rookie said:


> i understand that. that is why i said 99% of the cases. maybe i am wrong about 99% but i am sure i am not very far off. if i am wrong, can you please educate me on what exactly does a lawyer do when he gets a well templated agreement? exactly, what kind of advice does a lawyer dispense? i dont recall getting any advice.


The lawyer's "advice" is implicitly given by allowing the transfer of title for money. The client hires the lawyer to convey the property and protect their legal interests. If it's the buyer, the buyer usually hires the lawyer to advise both the buyer and their lendor that the title is good and marketable. In other words, if there is a legal defect or concern that arises during the conveyancing process and it leads to loss down the road or the lawyer doesn't notice and fails to disclose to the buyer and the lender, the lawyer gets sued, sanctioned, disbarred, or even criminally charged -- even when it's 10-20 years later. 

People often think that once they are approved or qualified for a mortgage that they are guaranteed that money. But the bank never actually lends until the lawyer sends their advice in writing to the bank that they can go ahead. 

For a lendor, losses in residential RE deals only really occur when a client defaults on their mortgage and they have to foreclose. Right now BMO is suing a bunch of Calgary firms for $100M for failing to disclose irregularities in the conveyancing process. Some of it involved stupid mistakes like failing to properly verify the identity of the client/borrower, but some of it is more technical. We are all watching to see how this lawsuit goes, because it will be a good indicator of whether the other big 4 banks will follow. 

For houses, conveyancing CAN be straightforward, unless ... the other side's lawyer doesn't provide their documents for us to review until the last minute, or there's a dispute on the meaning of some parts of the contract (like what to do if there's non-compliance with a housing by-law, or an encroachment, or something else), or when the client has an old mortgage from a now-defunct credit union and we can't track down the lendor for independent confirmation of that fact in time for closing, or when the real property report isn't available before closing, etc. Closing issues don't always come up, but when they do everything else gets pushed aside. My firm looks more expensive because we quote slightly higher than other firms, but we don't raise our fees for a closing that goes sideways. This June, I closed a difficult condo deal and spent at least 40-50 hours on that dang file in the 10 days before we finally closed. He paid me $700 in fees, not the $4,000 he would have paid to me alone, not even counting the time spent by one of the partners who had to get involved, if we were doing fees based on an hourly basis. After accomplishing this miracle, the buyer was irked because we closed 4 days late and the realtors were livid. After the stress died down, the buyer did call and thank me. I bought a thank-you gift for my conveyancer. Such is real estate, I guess.


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## Berubeland (Sep 6, 2009)

Well explained Racer...

Even more reason to get upset when realtors claim to do all the heavy lifting where property legal problems are concerned. 

My understanding is that they fill out the Offer of Purchase and Sale and the lawyer does the rest...

Kudos to lawyers


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## rookie (Mar 19, 2010)

thanks racer, for educating us. looks like its a 50-50 chance that it can be an easy deal or a complicated deal. i understand condo transaction might be tricky with different managements having their own legal documents.


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## Scottlandlord (May 27, 2010)

I've found that using a Realtor defiantly speeds up the selling process. 

You have to find a Realtor who is on top of their game and understands your target market.

They are out there.


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