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Streamline a transaction

Devils Advocate said:
How about a non-contingent hourly fee of $150.00 per hour, exclusive of disbursements and a initial advance of an appropriate retainer fee.

In instances where a transaction e.g. viwings and/or showings, negotiations,etc. was completed in it's entirety within 10 hours, the client's total costs would perhaps be $1,500 plus applicable taxes ..... but if not,the clock would still be ticking.
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I would have absolutely no problem with that.
Contract bundle takes an average of 2 hours to prepare
Buyers Agency
Fintrac Disclosure
Receipt of Funds Record
Confirmation of Representation
Agreement of Purchase and Sale

Takes me an hour to an hour and a half to read them through with a client.
You mean you sign things to spend 300K and don't read and comprehend the contracts?
Go and Present the offer, maybe in person, maybe fax or email (pdf)
Acknowledge Sign, accept,
Attend your inspection, Meet the Appraiser, Deal with the financing,

This in no way allows for tours, showings, inspections, preparation or research.

I would be pleased with $100-150 per hour for look loo's and showings where nothing ever comes of the process.

Bring it on!
 
I'd say the hourly fee should be closer to $40. You're talking about a job with a minimum of education required (less than 1/6 the education of a massage therapist who charges about $80/hour). Once the agent has proven themselves and has a track record of recommendations, they can start to charge more per hour, just like a lawyer or any other number of hourly positions. Surely experienced RE agents would welcome something like this. As it now stands, with only a correspondence course, a new RE agent gets the same commission as one who has 30 years experience and a network of helpful lawyers, inspectors, etc.. The more I think about it, the more this would benefit everyone. If you want to waste a realtor's time with house hunting - the agent still makes money - if you don't buy, it wasn't a waste of the agents time and they get paid. It would also keep prices in check, plus if you completely remove the possible conflict of interest possibilities and make sure that the RE agent is working for you and you alone, it could be an incredible model. Let's see a ballsy RE agent start a trend! It would also be more fair as the buyer/seller would each pay their own agent's fee.
 
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an increasing hourly rate for experience would be completely unnecessary.

could be like mechanics, they have their listed times to do things.
with experience, it could be done quicker but still charged the posted rate ... an experienced realtor would be able to do more transactions in the same alotted time; but i still don't think that's the way to go.

correct me if i'm wrong but a lawyer charges $1500-2000 to complete a RE transaction ... explain to me then why a RE agent should be compensated 10x (ie. assuming 5% commission on the average $400K property) more when the legal process is alot more important ???

3% commission (1.5% each side) would be enough and i'm being generous there ...
1 sale per month x 12 months = $72,000 is very good for any career, let alone something that only requires minimum education.
 
cdr108 said:
correct me if i'm wrong but a lawyer charges $1500-2000 to complete a RE transaction ... explain to me then why a RE agent should be compensated 10x (ie. assuming 5% commission on the average $400K property) more when the legal process is alot more important ???
Click to expand...

I'm not sure what lawyers you're using, but my last RE sale (5 months ago) cost exactly $800 in legal fees, of which only $500 went to the lawyer, the rest were disbursements, faxes, etc. Prior to that, the lawyer on my last purchase only charged $700 for his fee (plus about $400 in ancillary fees). Anyway, the point is that I agree that the law side is more important and they're only compensated $500-$700 per RE transaction - or assuming a $300 000 sale/purchase, 0.2-0.3%.

Maybe I should start this new type of RE work? I wonder what the obstacles would be to setting up something like this? Would any RE agents care to enlighten?
 
simuls said:
Maybe I should start this new type of RE work? I wonder what the obstacles would be to setting up something like this? Would any RE agents care to enlighten?
Click to expand...

RECO, the body which exists to protect consumers, may have issues with it. Pricing allowed is pretty restrictive and you would probably need to contact both RECO and have a lawyer interpret for you.

REBBA, Rule 36, is filled with terms like "remuneration ... in respect of a trade"; without mentioning remuneration when no trade takes place.

Dealing with new property would be difficult. Developer will pay up to a maximum value, typically percentage, but you will have a fixed dollar figure to cover which may be more/less then this. Mixing dollar figures and percentages is not allowed and many brokers are holding the developers commission cheques until the property closes, for lots of really good reasons, making settling the shortfall/extra with the client difficult.

Third, if you don't have a written agreement then rates default to the typical local rates. Buyers are loathe to sign an agency agreement until they find a property to buy and you will not be able to collect without a signed contract.


If you can get RECO on board, then you're set. Brokerages have no power over independent contractors.


I'm rather curious about this.
 
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