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Survey: Realtors helping create bidding wars

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guest | 09 May 2012, 03:00 PM Agree 0

Half of those polled for the online survey said agents don’t have their best interests in mind when selling their homes.
"Today's buyers and sellers don't like being pawns in a process, and real estate agents should give Canadians more credit," said Ken LeBlanc, president of PropertyGuys.com.
According to the survey, which surveyed 1,000 Canadians, 67% of those polled agree traditional real estate agents, and their commission fees, are one of the factors contributing to home price inflation.
The Canadian Real Estate Association (CREA) decline to comment on the survey without having reviewed its questions, methodology and data.
But the organization reiterated its position that Realtors are “trusted advisors helping Canadians with one of the biggest financial decision of their lives – the buying and selling of a home or property.”
PropertyGuys.com is Canada's largest and fastest growing private sales franchise network. Its sites allow sellers to list their own properties without going through an agent.
  • Tony | 10 May 2012, 07:15 PM Agree 0
    No one forces a Buyer to compete in multiple Offers. It is the Buyers that inflate the prices of homes. Who says you save by listing with discount brokerages. Just read Seller listed with PropertyGuys could not sell..listed with Realtor resulting in mutiple offers. I think a lot of people are overpaid in what they do. Realtors deserve more than 5%.
  • Kelly Brasil | 10 May 2012, 07:16 PM Agree 0
    I work as a realtor in the central Toronto market. I have been on both sides of the coin in multiple offer situations. I personally hate multiple offers. I can however tell you from personal experience that sellers are well aware of the strategy for pricing at or slightly under market value and setting a date for offers. Many sellers I've come across have been the ones to bring up the subject because they feel it's the best way to maximize the final sale price of the property. Furthermore, spending a substantial amount of time working with buyers in a very busy marketplace, without offer dates, some properties literally sell in a matter of hours. If this happens the seller is left wondering if they priced the property too low and buyer becomes very frustrated and angry if they don't get to see a property, let alone make an offer on a property that matches their criteria.

    So please, will someone explain to me the best way to satisfy all parties involved? Realtors are always the scapegoat in these scenarios but you must keep in mind that we, as realtors simply provide a service. We explain the options to our clients, the consumer, and they ultimately make the final call on how they will sell or buy a property. Wether that's to hold for offers as a seller or how much to pay for a property, the final decision is left in the hands of the consumer, so why is always the realtors fault?

    One final thought on the matter, my personal opinion on the matter is that there should be strict guidelines that must be adhered to, such as one offer per buyer, you make one offer, if it's accepted, great, if not, better luck next time. This whole "the offers are close so we're giving everyone an opportunity to improve" only leads to multiple attempts to get a higher sale price and I can almost guarantee that any seller sitting at a table with an option to take more money, will be more than happy to play this game. Also, perhaps there should be full disclosure of offers? If everyone knows that the highest offer is, then perhaps buyers won't be left feeling like they paid more than they had too? How about a live auction rather than blind bids?

    There are a lot of ways to improve the multiple offer scenarios that occur on a daily basis. As much as realtors may make the suggestions as how to conduct the sale or purchase of the property, the consumer makes the final choice. If we as realtors don't present every scenario to a client, we're a blamed for not doing our jobs, if we do, then we're to blame for driving up prices. It's a no win situation.

    Finally, for anyone that feels realtors are over paid, I challenge you to spend a year in our industry and then have a discussion about commission rates. When your entire personal life is dictated by servicing your clients, your weekends and evenings spent showing properties or working with clients for months without compensation only to have them walk into a random open house, buy direct through the listing agent and then call you and say, well, I have some bad news..... We face many challenges as realtors and the respectable, professional realtors out there earn every cent they are paid!
  • Tony | 10 May 2012, 07:18 PM Agree 0
    No one forces a Buyer to compete in multiple Offers. It is the Buyers that inflate the prices of homes. Who says you save by listing with discount brokerages. Just read Seller listed with PropertyGuys could not sell..listed with Realtor resulting in mutiple offers. I think a lot of people are overpaid in what they do. Realtors deserve more than 5%.
  • Keith Monahan | 10 May 2012, 07:40 PM Agree 0
    Is it not the primary function of a Realtor to get the absolute highest dollar for a sellers home? That being said who is the winner if that happens?

    Lets be serious this sounds like sour grapes from a company that simply neither knows how or has the will to market property to the absolute highest benifit of the Seller.

    Agents don't determine the sale price, a willing buyer does that. We simply create the want ( easier said then done) and the market does the rest. Then we carrie the contract and parties attached to that contract to completion.

    We do far more then provide a sign and some forms, we actually get results and protect our clients along the way.
    They get thier fee regardless if the house sells or not. We get success or we make nothing, that success only comes only if the Seller chooses to sell.
    That comes from hard work and experience. The above study to me appears to be nothing more than self promotion, to prove that they have value. Making certain your clients are successful in terms of dollars, they are protected in all ways and the property closes now that is value.
  • Gigi | 10 May 2012, 07:54 PM Agree 0
    A bit more information would have been nice. This blurb accuses realtors of being duplicitous but gives nothing to back up this claim. What were the questions asked? What were the responses? The study was commissioned by the Property Guys, so one would imagine the questions were structured so that they would get answers "proving" that the Property Guys were a much better option than a traditional realtor. A neighbor of mine used their services after interviewing several agents and deciding their fees were too high. He took his own pictures (with his cell phone), did very little to get it ready for the market, did all the showings himself (when his schedule allowed), followed productive buyers around and making them feel uncomfortable.
    He priced it too high and it was on and off the market for more than 6 months. Eventually he listed with an agent who helped him with staging, de-cluttering, purging, painting and improving curb appeal; all things he said didn't matter because he was in a good neighborhood. With the help of the agent his house sold in 2 days for a price that he was very happy with.
  • Rick Korol | 10 May 2012, 08:13 PM Agree 0
    WHO - COMMISSIONED THE SURVEY? HAVE WE HEARD ANY SELLERS COMPLAINING? AREN'T THEY 50% OF THE EQUATION?
  • Tatiana | 10 May 2012, 09:24 PM Agree 0
    I have never read so "yellow" article before. Are you serious? Of course, you would not have a bidding war with the PropertyGuys. It takes twice time to sell with them instead of using a realtor.

    If this survey has been commissioned by PropertyGuys.com, how can it be objective?
  • Paul Hecht | 10 May 2012, 10:24 PM Agree 0
    For those who are not clear on the process, a REALTOR'S duty is to their client. They must give their seller all the information and then let the seller decide what they want to do with the information.

    In hot markets, the listing agent will ask the seller if they would like to list the property low and then hold off accepting offers, typically for a week to try to generate multiple offers, OR the seller can list it at market value and accept offers immediately.

    The seller is the one who picks whether they want to try and create a multiple offer (bidding war) scenario, not the REALTOR.

    If buyer's don't want to get involved in a multiple offer, then don't make an offer - it's that simple.

    As I can only speak for myself, I know that whenever I'm representing an investor client as a REALTOR, I earn every dime.
  • Tonio | 11 May 2012, 04:07 PM Agree 0
    This publication is slowly loosing credibility.
  • Michelle Brienza | 14 May 2012, 06:32 PM Agree 0
    It is articles like this that create havoc in the industry! How disappointing! Why are we pinning this bidding war situation on realtors? That's not fair! This situation is a lot more complex than this article presents. I consider this is poor journalism when someone doesn't take the time to look at many of the variables and take the time to EDUCATE their readers. This article is horrible and offers zero insight to the current real estate market situation. I am extremely disappointed.
  • Farhana | 22 May 2012, 05:07 PM Agree 0
    Property guys :)
    Only in Canada we have complain about realtor fees !!
    We are professional , like sny other business!!
    We dedicate our time and effort and list the property without getting paid upfront !!
    Only our industry it happens !!
    Imagine u go to the lawyer , doctor , accountant and say I will not pay u till u give me services !!
    Good luck !!
    I see u take ur fees upfront too :)
    In terms of service ,U do nada !!!
    Please stop misleading the public at least that we don't do as a
    Realtor !!
    It's against our fiduciary duties !!
    Cheers
  • Gary McLean | 22 May 2012, 05:35 PM Agree 0
    The emphasis is in the wrong place. This is a market - pure and simple where supply and demand are the two drivers of price and market time. The value of a REALTOR(tm) is in helping buyers and sellers interpret where the market is saying at the time they are buying and selling, and what strategies to use to accomplish their individual goals. To suggest that REALTORS(tm) create the market is wrong-headed. We interpret the market. And we are woth every penny.
  • Andrew Brest (www.sundaybell.com) | 22 May 2012, 05:39 PM Agree 0
    Doesn't it come down to what the buyer is willing to pay for a property, and what a seller wants to sell it for?
    Working with the right REALTOR, these things are established in advance.
    I've heard so many horror stories of people being undersold and I don't think anyone ever complains when they get what they want, provided it's what was pre-determined in advance.
    Let's be realistic, REALTORS know how to market properties: it's their job. Why fault them for doing a good job.
    Just my two cents.
    Andrew Brest (www.sundaybell.com)
  • John L Murphy Broker / Owner Hybrid Realty, Nova S | 22 May 2012, 06:46 PM Agree 0
    I am Broker / Owner of a Real Estate firm which Offers clients a full range of services from Private Sale Packages where all we do is provide a media and organization to full MLS service. We feel that if a Seller wants to be involved in the process and do some of the work themselves they deserve to save some money for doing so.
    In saying that, we still find that once all the cards are on the table Sellers seem to have a better understanding of and an appreciation for how we earn our money. The vast majority of Sellers we work with choose full MLS service and are happy to pay us to provide our expertise and service. In the final analysis, we are highly trained professionals and we do know the industry. We do a lot more than put a sign on the lawn and wait for a pay check. We are not an advertising company masquerading as Real Estate experts.
  • Terry Kulaga | 22 May 2012, 07:19 PM Agree 0
    With this sort of journalism I will stop buying up subscriptions for my clients. As a realtor, I believe it's important to keep clients informed of the market, and this magazine can do a good job at that. But, when you publish an article commenting on the market dynamic it is equally important to talk about the supply and demand quotient.
    Very disappointing.
  • CWB | 22 May 2012, 07:47 PM Agree 0
    Personally, I think that the article gives Realtors too much credit. As an investor, I wish I could find a Realtor who would generate multiple offers. Most of the time all a Realtor is good for is talking about how great they are. Of course, as soon as they get the listing you find out that the talk was nothing more than talk. All the Realtor really wants to do is put your property on the MLS, usually with a half-assed listing, and wait for offers. Many don't want to do things like marketing or open houses, because why bother working when you can be on the golf course and other agents will bring buyers to the listing. I am glad to see that the standard listing commission is becoming much more negotiable, because quite frankly, most Realtors don't earn their full commission.

    To sum it up: "Hey Realtors, less talk more action and then maybe you won't have to worry so much about these types of articles and the general public having such a negative view of you!!"
  • Kelly Brasil | 23 May 2012, 03:53 PM Agree 0
    Re: Post by CWB

    Wow, all I can say is that you must have had a very negative experience with a realtor or perhaps more than one. I would make this comment, if I started a relationship with a realtor, or any other professional for that matter that involved the individual "talking about how great they are" I would have looked for another professional to work with, or shall I say, I would have looked for a professional to work with because you're clearly not speaking with one.

    Your discussion with a realtor that you're considering hiring should revolve around facts not hype. Facts surrounding market conditions, current and past sales activity and the realtors statistics in comparison to the general market. This is how you evaluate a professional who is providing a service, regardless of the industry they are in. If you were going to have surgery and you were meeting with the surgeon, would you sit and listen to them tell you how great they were or would you ask serious questions like, how often do you perform this type of surgery? How many of your patients have survived? Would you then compare them to perhaps the industry standard to see if they are better than the average surgeon or would you just take their word for it, cross your fingers and hope for the best?

    I agree that the real estate industry is actually a very easy profession to enter. The cost and time required to obtain a licence is relatively low given the potential return. This leads to a lot of people looking to get into the industry and unfortunately they are not always the best suited or most ethical. I believe education levels should be increased and costs should actually go up. If it took two years and $10,000 to get licensed, there would be less people saying "I think I'll give real estate a try..." which is what I've heard constantly over my 9 years in the business. Anyone that says "give it a try" is clearly not committed or passionate about the industry.

    I do however, firmly believe that there has to be some weight put on the consumer as well. The client is ultimately the one who hires the realtor. I wonder sometimes if clients are too focused only on commission. Is commission really the most important variable? If you hire an unqualified individual for 1% listing commission or better yet all these new discount brokerages who provide a sign and some paperwork leaving inexperienced sellers to negotiate not only the sale price but a legal document and the terms thereof which opens up the doors for all kinds of lawsuits or would you better off paying a professional realtor who knows their business and can help you prepare your home for sale, showcase it in the best light, facilitate showings, bring you qualified buyers and protect your interests in a negotiation and make sure you're not opening yourself up to lawsuits. I would suggest a professional realtor is worth their weight in gold.

    Consumers should do more research when hiring a realtor. Some consumers couldn't care less what comes out of a realtors mouth aside from how much it's going to cost them to sell their property and what they would list the property for. If they like what they hear then, "you're hired!" if not, "thanks but we've decided to work with so and so". Until consumers set a higher standard for the individuals they chose to work with, they have to accept some responsibility for the overall standard of the profession.

    The bottom line, as a consumer, do your homework on the individual that you're considering hiring. Listen to the information they are providing you. If it's about "how great they are" then look elsewhere. Ask about the facts, compare them to industry standards and then make a decision. You shouldn't even discuss commission or list price until you've decided who you're going to work with. If the consumer sets a higher standard the industry will have no choice but to follow. If the primary concern continues to be listing commission and sale price, the industry will also follow... the choice, as always, is in the consumers hands!
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