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The Halifax real estate market sure is a competitive one. Many of the full service brokerages are competing against new pricing models in the form of discount brokerages, namely ones offering a dramatically reduced commission. The objective of these companies is to attract home owners with a lower cost of selling their property. I have a very strong and long winded case against this kind of real estate model, which I will elaborate further.
The allure of a discount real estate company, for any property owner, is to save money while selling said property. That much is certain. But what many discounted realtors do is sell the owners on the concept of saving money, without fully explaining the logistics of how the real estate industry works.
Every transaction, by its very nature, has two ends - a listing end and a selling end. Nine times of out ten, there will be two agents involved - one who represents the seller and the other who represents the buyer. It should be noted that buyers don’t pay commissions to the buying agent almost 95% of the time because the seller, who is motivated to sell their home, ponies up the cash for both agents. This is called a cooperating commission. It acts as an incentive for a buying agent to move the property and work with the sellers through their listing representative. With this dynamic, both sides, as in a court room, have their respective agents working on their behalf. The legal liabilities for the agents are huge. At any point in a transaction, where money is lost or other elements impact the financial well being of either party, agents could financially be liable for a good deal of money.
What this creates is a highly developed sense of professionalism within the industry. The costs associated with paying licensed agents are justified in the legal protection, professionalism and services we provide.
In listing with a discount real estate service, yes a seller is saving money on their end. However, without offering adequate compensation to a buying agent, in lieu of the last paragraph and legal ramifications and potential risks for both parties, no buying agent has an incentive to bring in their buyers who don’t have to pay their agents anyway.
In discounting services, agents are essentially discounting themselves and their abilities as agents. They’re diminishing their worth. By slapping on a lower price tag for their services, the agents are essentially saying they aren’t worth that much. Agents who have success, whose clients love them from the quality of service provided, have no need to discount themselves as they know their worth and can deliver results.
Discount brokerage sales tend to be lower than those of full service brokerages. Properties will sit and become stale on the market because they’re only appealing to buyers who don’t have agents, whose population is exceedingly small. If a buyer can get their own agent for free, how many buyers do you actually think would go purchase property on their own? Not very many. And many of those who do are looking for a deal of their own.
In closing, yes a discounted model, like Giant Tiger or walmart, will save a seller money - if the home is sold. Essentially, you are saving 3-4% of nothing, instead of paying 4-5% of something.
If you’re thinking about selling your property, don’t just think about saving money. It’s a very basic instinct. The motivation should be to get the best legal protection, from the best professionals in the industry. Because when things go south and your money is on the line, you will breathe a sigh of relief that you paid the little extra to have good service.
Thanks for reading,
Andrew Murray, REALTOR
EXIT Realty Professionals
It’s no secret that Realtors, much like any other professional service, say accountants or lawyers, are seen by the public as homogenous. There are so many from which to choose that we all looked at as the same. The trick for any professional to make an impact and generate business is to network in an attempt to stand out, or to embark on an extensive marketing campaign. In the end, we all still look the same, since we are all doing the same thing.
We are fast approaching the busiest market place for real estate in HRM. Despite talk from the nay sayers and others, the Halifax Real Estate market is still alive and well.
Starting in January 2012, the dynamism of listings and sales has never ceased or abated. Coupled with an excess of inventory and low interest rates, combined with a tick of demand as result of the ship building announcement and discovery of oil off our beautiful coastline, the housing market is both hearty and strong.
Though there was a small dip in the summer, as expected due to vacations and the exceptional weather we’ve been having, the Fall market is springing up even before a seasonal change. On MLS the number of homes listed daily is now equal to those with conditional offers. What’s more, even more inventory continues to flood the system in an attempt to grab more market share.
Though sales are up across the municipality, the highest demand rests on peninsular Halifax. I have had the pleasure of working with clients, after my recent breakthrough in this market, who have each sold their properties for 98% of asking price within two days on the market. This kind of demand is, heretofore, unprecedented.
My advice is, if you’re looking at selling your property and relocating, do so now. With the markets overseas continuing to be volatile and unstable, now is not the time to be greedy and wait. Take advantage of current market conditions and move now. You may make an additional 4% in a year, but that’s only if the market continues. Lessons learned, while situations that are benevolent last, more often than not they have a habit of tanking out.
Fortune Favours the bold.
JUST LISTED - 2794 Connolly Street in West End Halifax. A beautiful set of up and down flats for $449,900. Great opportunity for owner occupied with rental income or for an income property. Located on a large corner lot at the corner of Connolly and Almon, the rents are currently lower than the rental market dictates. Book now for your private viewing!
Just Listed! 7110 Bayers Road. Take advantage of this central location, close to all amenities and all major roadways in Halifax. Renovated top to bottom, literally, this home is literally turn key. Perfect for a young family or first time home buyer, this home is waiting for you. Call today for a private viewing.
Andrew Murray, REALTOR
JUST LISTED - 6284 Yukon Street in a quiet West End Halifax neighbourhood.
You have never seen old meeting new in such a practical and classy way until you see this charming home. Located on a quiet cul de sac in a family friendly neighbourhood, this home boasts its old charm with many new upgrades. With natural gas, installed in 2009, the annual heating bill is exceptionally low. What`s more, the blown in wall insulation, completed in 2007, and new roof installed in 2004, makes this home even more energy efficient. Enjoy the relaxing atmosphere in the main living area, which has a wood insert fireplace, bar-like kitchen/dining area and large open foyer. Take a stroll into the private backyard, teeming with shrubs, fruit trees, vines, evergreens and perennials, or walk two streets away to bustling Quinpool road shopping and dining. 4 Bedrooms upstairs for young families! To make this property that much more affordable, it also boasts an R2 zoning, coupled with monthly rental income. This really is the way to live practically, but to do so with style.
I’ve known Andrew for several years on a friendly level and when it came to purchasing our first home, he was our first choice. We had to move within a fixed budget and timeframe as we were expecting a new addition to our family, but he made sure our first house purchase was not only a great fit for what we wanted, but was genuinely a good purchase and investment.
He showed great dedication to our interests by selecting houses that fit our specific needs and he made sure we found a place that we were truly satisfied with. All aspects of the transaction happened smoothly and we were in our new home very quickly. He also made sure we understood the intricacies of the entire process and did not hesitate to explain everything.
He recommended some fantastic people to work with as part of the buying process and corresponded on our behalf, whenever necessary. He ensured all parts of the process were taken care of, which made our lives much easier. Andrew is definitely a realtor who places professionalism and customer satisfaction as his highest priority, and we would not hesitate to recommend him to friends and family who are looking for an amazing agent.
Jamie, Alycya and Brody
JUST LISTED - 25 Dakin Drive in sunny and beautiful Birch Cove. Priced at $479,000 - this property boasts over 3000 square feet inside, a 17,000 square foot fully landscaped lot and a legal 2 bedroom basement apartment! Don’t miss your chance to own this beautifully renovated home with rental income in one of the most breathtaking areas in Halifax!