Canadian Real Estate Agents – For over a century, Realtors have been used in North America to facilitate home buying. First founded in 1908 as the National Association of Realtors (in the US) and later adopted in Canada as the Canadian Real Estate Association, the Realtor trademark is a highly recognized name across the continent. While Realtors certainly have their place, many first-time home buyers and sellers aren’t sure whether they need to use one. On the one hand, Realtor commissions are typically around 7-8% of a home’s value, which equates to about 7-8k per hundred thousand. That’s a lot of equity to give up. On the other hand, buying or selling a home without a Realtor can be daunting.
Canadian Real Estate Agents
As a home buyer, you have nothing to lose in using a Realtor. To start, usually, the seller pays all of the Realtor fees, which means you get their services for free. Also, you get access to the MLS, which can be the difference between finding a house over a few weeks instead of a few months. Realtors also facilitate the lending and closing process to sweeten the deal, which can be challenging to navigate independently.
Home Buying
One caveat is that most Realtors will want to sign an exclusivity contract, meaning that if you buy a home, you’ll have to buy it through them. This protects them from doing all the work and getting ditched at the last minute or in the event of a backroom deal between buyer and seller.
This matters because when you shop for a home, you should feel out a few Realtors before deciding to stick with a particular one. Choosing the right Realtor is almost as important as selecting the right home.
Home Selling
Selling a home is a different story because you have to worry about closing costs and Realtor commissions. First of all, do you have enough equity to pay the Realtor fee, and if not, do you have enough cash in the bank to cover it? If not, you’ll have to sell without a Realtor or see if you can negotiate the commission with the Realtor.
If you can afford to pay the commission, then there isn’t a compelling reason not to use a Realtor. Yes, they are expensive, but they pay for marketing, list you in the MLS, and put you in front of buyers you’d otherwise be unable to reach.
The Canadian Mortgage Market for Prospective Homeowners
Use Our Free Mortgage Calculator
Whether buying or buying and selling, you’ll need to know how much money you have to work with and how much you can afford to spend on a new home. Instead of guessing, please take advantage of our free mortgage calculator & quotes section, where you can get free quotes from five local mortgage brokers. You’ll also be able to use our mortgage calculator to glimpse your potential monthly payment to see how much you will need net from the sale of your home or how much you’ll need as a down payment to get the amount where you need it.
