Calgary real estate prospects

[jwslam]

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Partially, but the part of representing for future properties was never the case.

99% sure you wouldn't have got the house if your offer said the realtor gets $0 for being your buying agent.

[pheoxs]

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99% sure you wouldn't have got the house if your offer said the realtor gets $0 for being your buying agent.

Likely but does that matter in the end? As a buyer it doesn't affect me because had I brought my own Realtor I still wouldn't have gotten that money.

What I see could've happened is:
Offer 500k /w my own Realtor -> Get out bid by someone else
Offer 550k /w my own Realtor -> Maybe we win the competing offers
Offer 490k solo and ask for them to not take the other half -> Probably get out bid by someone else
Offer 500k and let their Realtor take extra commission -> I got the house

In the end, the last is the favorable option for me as I never paid any more out of pocket. That's the game basically.

[CompletelyNumb]

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Offer 500k and let their Realtor take extra commission -> I got the house.

For comparison I've tried this a half dozen times this year (2024) and all of them told me to get a Realtor one way or another.

Every one of those listings sold for way over list and with no conditions as well.

To me the current pattern is pretty apparent.

Congrats on your purchase whenever that was though.

[89coupe]

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Random person trying to buy a house listed on MLS by a Realtor™
Contacts listing Realtor™ to see the house

This goes one of two ways:

Option 1:
Realtor™: Oh you don't have a buying agent? That automatically makes me your Realtor™ when you want to buy this house so I get full 7/3 for myself. It also means if you don't buy this specific house, I am automatically going to be your Realtor™ for any other house you end up buying within the next 24 months.

Option 2:
Oh, you're not a qualified Realtor™ so you can't see the house. You must enlist me as your buying Realtor™ immediately.

I offer unrepresented customers 3 options if they want a home I’m selling.

Represent themselves
Allow me to represent them
Find another realtor to represent them.

[89coupe]

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Best be saving your money. Things are a changin.

I wasn’t referring to me.

[you&me]

Unpopular opinion - I don't actually have a problem with Realtor ® fees / commission rates, though there could be some changes with how they're contracted with sellers and negotiated behind the scenes with other Realtors ®. Earning ~1.5% for transacting hundreds of thousands, or millions of dollars worth of anything, in any other industry, will see at least similar commission rates, if not much higher (Fine art auctions - 20 points, per side!)

The problem is the level of professionalism and the lack of barriers to entry. Calgary has over 7,000 licensed Realtors ® and there are currently 3,600 active listings across all property types. There is not another market that exists with such an imbalance between product and participants. Can you imagine a car dealership with 40 sales guys and 20 cars on the lot? The general public - and the industry's reputation - would be far better off if there was a cull of the bottom 1/4 - 1/3 of agents...

[killramos]

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Unpopular opinion - I don't actually have a problem with Realtor ® fees / commission rates, though there could be some changes with how they're contracted with sellers and negotiated behind the scenes with other Realtors ®. Earning ~1.5% for transacting hundreds of thousands, or millions of dollars worth of anything, in any other industry, will see at least similar commission rates, if not much higher (Fine art auctions - 20 points, per side!)

The problem is the level of professionalism and the lack of barriers to entry. Calgary has over 7,000 licensed Realtors ® and there are currently 3,600 active listings across all property types. There is not another market that exists with such an imbalance between product and participants. Can you imagine a car dealership with 40 sales guys and 20 cars on the lot? The general public - and the industry's reputation - would be far better off if there was a cull of the bottom 1/4 - 1/3 of agents...

This is a great take

[89coupe]

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Unpopular opinion - I don't actually have a problem with Realtor ® fees / commission rates, though there could be some changes with how they're contracted with sellers and negotiated behind the scenes with other Realtors ®. Earning ~1.5% for transacting hundreds of thousands, or millions of dollars worth of anything, in any other industry, will see at least similar commission rates, if not much higher (Fine art auctions - 20 points, per side!)

The problem is the level of professionalism and the lack of barriers to entry. Calgary has over 7,000 licensed Realtors ® and there are currently 3,600 active listings across all property types. There is not another market that exists with such an imbalance between product and participants. Can you imagine a car dealership with 40 sales guys and 20 cars on the lot? The general public - and the industry's reputation - would be far better off if there was a cull of the bottom 1/4 - 1/3 of agents...

I raise this question with my brokers constantly.

The lack of professionalism is horrendous.

Part of the issue is the part time realtors, shouldn’t be allowed.

[you&me]

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I raise this question with my brokers constantly.

The lack of professionalism is horrendous.

Part of the issue is the part time realtors, shouldn’t be allowed.

I think I brought this up before and was corrected, but... Aren't the brokerages at least partly to blame for this. My understanding is that the Realtors ®.need to operate through a brokerage, and the brokerage charges the agents for everything from desk fees (basically just to hang your shingle) to cuts of commissions... The better, more productive agents have leverage over the brokerages and can negotiate better terms, but for the bottom rungs of the dreamers that do approximately zero business per year, the brokerage is happy to take their fees... In fact, from the perspective of the brokerages bottom line, for every rock star agent, it's probably better business to have a couple dozen zero performers.

Is that vaguely right? How would you change that?

[msommers]

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And realtors will actively go out of their way to avoid/poo-poo the low commission ones..

Will? They already do.

Helping to keep the monopoly going.

[89coupe]

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I think I brought this up before and was corrected, but... Aren't the brokerages at least partly to blame for this. My understanding is that the Realtors ®.need to operate through a brokerage, and the brokerage charges the agents for everything from desk fees (basically just to hang your shingle) to cuts of commissions... The better, more productive agents have leverage over the brokerages and can negotiate better terms, but for the bottom rungs of the dreamers that do approximately zero business per year, the brokerage is happy to take their fees... In fact, from the perspective of the brokerages bottom line, for every rock star agent, it's probably better business to have a couple dozen zero performers.

Is that vaguely right? How would you change that?

I’m not sure how other brokerages run their business, but at mine, the fees are the same for everyone $15000/year. If you want an office space at the brokerage you pay slightly more. $3000 more per year.

[Buster]

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Unpopular opinion - I don't actually have a problem with Realtor ® fees / commission rates, though there could be some changes with how they're contracted with sellers and negotiated behind the scenes with other Realtors ®. Earning ~1.5% for transacting hundreds of thousands, or millions of dollars worth of anything, in any other industry, will see at least similar commission rates, if not much higher (Fine art auctions - 20 points, per side!)

The problem is the level of professionalism and the lack of barriers to entry. Calgary has over 7,000 licensed Realtors ® and there are currently 3,600 active listings across all property types. There is not another market that exists with such an imbalance between product and participants. Can you imagine a car dealership with 40 sales guys and 20 cars on the lot? The general public - and the industry's reputation - would be far better off if there was a cull of the bottom 1/4 - 1/3 of agents...

I don't have a problem with any of it. And I wouldn't knock another man's hustle. My point is that the disruption will come. Is it sophisticated ai integrated with automated enhanced realty tours with automated virtual staging?

Is it sophisticated multi variable algorithms combined with ai to get highly accurate dynamic pricing estimates?

[bjstare]

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I’m not sure how other brokerages run their business, but at mine, the fees are the same for everyone $15000/year. If you want an office space at the brokerage you pay slightly more. $3000 more per year.

Does your brokerage vet their agents on quality and productivity before allowing them to operate there? Or do they have some agents on the roster that sell <2 houses/yr?

[killramos]

In his defence he already said he don’t happy with his brokerage for not cracking down on the clowns

[bjstare]

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In his defence he already said he don’t happy with his brokerage for not cracking down on the clowns

Not intended to be an accusatory post at all, I just think he misenterpreted the point you&me was making haha. It wasn't about the fee structure.

[suntan]

There is no downside for a brokerage to take on realtors, if they turn out to be shitty they can be punted in a moment's notice.

[you&me]

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Not intended to be an accusatory post at all, I just think he misenterpreted the point you&me was making haha. It wasn't about the fee structure.

Well, it kind of was about the fee structure and 'Coupe confirmed my point... the brokerage - charging $15,000 per year to every warm body on the roster, regardless of productivity - has a motivation to have as many useless idiots in the office as possible. This is especially true if they take no part in the agent's productivity (commission split)... there's really no upside to actually having useful agents.

[jwslam]

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Well, it kind of was about the fee structure and 'Coupe confirmed my point... the brokerage - charging $15,000 per year to every warm body on the roster, regardless of productivity - has a motivation to have as many useless idiots in the office as possible. This is especially true if they take no part in the agent's productivity (commission split)... there's really no upside to actually having useful agents.

Who cares what my Realtor has for a personal reputation. He's got the Red/Blue logo on his business card, so therefore he must be good.

[Xtrema]

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I raise this question with my brokers constantly.

The lack of professionalism is horrendous.

Part of the issue is the part time realtors, shouldn’t be allowed.

Were you part time when you made the career switch? And aren't most agents dabble in something else like prop management or proj management to offset slow business on buy/sell side?

Like how many agents really do it full time.

[Justing]

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In his defence he already said he don’t happy with his brokerage for not cracking down on the clowns

Should the market not regulate itself then?
If a "realtor" makes 2 deals a year and can't justify paying the brokerage fee, then they'll disappear.

Let your money speak as always. It blows my mind people choose to use clearly terrible realtors when pros like Jordan cost the same. Not to mention someone who knows what they're doing and can get your deal across the finish line adds a ton of value especially in this market.