I get asked the same questions in a lot of my initial meetings. What goes into buying or selling a home? Should I stage? How long is this going to take? Will working with a Realtor help me make better buying or selling decisions?
And then there are the questions that I know people are curious about, but nobody seems to want to ask:
What does a Realtor even do?
Can’t I just sell on my own?
Where does commission go?
Here, I’ll dive into these questions to help buyers and sellers make an informed decision.
What’s the Difference Between a Realtor and a Real Estate Agent?
Many people think the terms are interchangeable, but they’re not.
A real estate agent is a professional who’s licensed to sell real estate. In Alberta, that means completing a curriculum from the Real Estate Council of Alberta (RECA), joining a brokerage, and submitting an application for a license.
Like agents, we Realtors are licensed. The biggest difference is that we’re also members of the Realtors Canadian Real Estate Association (CREA). As a member, I abide by a strict code of ethics that’s laid out to protect my clients.
For many buyers and sellers, the code provides extra assurance that they’re dealing with a trustworthy professional. Still, both Realtors and sales associates or real estate agents are capable of helping you buy or sell your home.
Working with a Realtor: Do You Actually Need it?
Whether you choose an agent or Realtor, one thing is certain: industry expertise will help you at every step of your transaction. Here are a few of the benefits a real estate professional can offer:
Better access to listings
Real estate professionals have access to industry networks and resources you don’t—like the multiple listings service (MLS), the system we use to share listings with one another. Some Realtors even specialize in private transactions, which are based on off-market listings. My point is, without help from a professional, you’ll discover only a fraction of the available listings that could meet your needs.
To get the best possible deal, you should know how to negotiate. Unfortunately, it’s not a skill that comes easily to most people. For Realtors, it’s part of the job. Whether you’re a buyer or a seller, we can help you push back against lowball offers to get the deal you deserve.
An understanding of real estate contracts
Real estate documents, such as Agreements of Purchase and Sale, exist to protect you. But these agreements can also be complex. We real estate professionals know exactly what you’re signing and how it will affect you.
Overall industry experience
I’ve had clients who weren’t sure how to find the right real estate attorney or home stager. Providing them with solid referrals was a great feeling. As Realtors, we know the industry inside and out. Our knowledge can help you through every stage of your transaction.
Where Do My Commission Fees Go?
Commission fees can be sticking points for many sellers. If you fall into this camp, you probably want to know where the money goes. That’s understandable. Here’s a basic breakdown.
Once a deal closes, a seller will typically pay their Realtor a commission which is usually a percentage of his or her home’s price. That might sound like a lot, but usually half of it goes to the buyer’s agent, who also needs to be paid for his work. What is the standard commission in Calgary? Great question! But there is no standard. We have seen all sorts of models from the discount model all the way up to a flat 6 or 7% on the entire sale price. If you are curious about your property, give us a shout and we will happily discuss this with you very openly.
The Realtor’s commission breaks down further when the head of her agency (a broker) takes some of it. Part of the amount the broker takes goes toward expenses associated with having the Realtor on the team.
That leaves the Realtor or agent with a lot less than you may have thought. I can tell you from personal experience that a lot of that remaining commission goes toward overhead, like advertising, fees, staffing and in our case marketing to a very high level.
For both buyers and sellers, the benefits of working with a Realtor or real estate agent almost always outweigh the costs. Sellers in particular may feel that they’re paying too much in commission. But this money doesn’t go straight into anyone’s pocket. We use it to ensure that you come out of your transaction happy.
Have any other questions about finding the right Realtor or buying or selling your home? Get in touch and let’s talk about it!