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February 6, 2014, 6:46 am

Realtor Bashing; They Are Very Good At Something

by: The Financial Blogger    Category: Properties

Last week, I enjoyed a very interesting discussion with Pawel, a Real Estate Agent, after answering the famous question “Should I Get a Real Estate Agent?”.  I truly enjoyed this discussion as Pawel defended his points without saying I’m a total lunatic. I like when two people can debate without telling the other party he is a lost cause. After all this back & forth conversation, I thought I “owed” it to cover the other part of realtors’ job. While I would never take a real estate agent to sell my house, I think they are very good at something else!




When you sell your house, this is usually 50% of a bigger transaction. Most people sell their house to buy another one. Therefore, once you sold your house, you are only always done with your transaction. The other half, probably the most important part, is to buy your new home. I think this is the most important part of the transaction since you usually make more money buying the right asset at the right time than selling it.


If you can buy the right house at the right price, it will be easier to make a healthy profit when you will sell it.




First of all, by definition, realtors are in the real estate business every day. They see what is put up for sale, what drops in price and what is being sold and the price it is being sold at. The fact they have easy access to this data is definitely a plus when you are looking to buy your new home. If you look for a house in Montreal for example, you are better off with an agent that keeps a Montreal home listing up to date like this one.


The agent can quickly find the type of house you are looking for and the listing you would likely waste a few hours to find on the internet by yourself. Plus, you don’t see everything on the internet. An agent will know the neighborhood better and might have already visited the house so he knows what pictures are not showing.


I also like the fact that he knows how long a property has been for sale and what has been sold recently. This is crucial information when you enter into negotiations. Unless you look at the Real Estate market on a weekly basis in the months prior to buying a house, you will not be able to know how long a property is being listed. The agent knows. He can also show you comparable properties that have been sold lately. There is always a difference between the price you pay and the price the house was listed at. This is why it is important to know how much the house is really worth. You can always find this information on your own, but it is more complicated and requires a lot more time.


Finally, the last aspect why I truly enjoy dealing with a Realtor to buy a property is the fact that he will book all your visits for you. You don’t have to do anything, he does it all. When I hunt for a house, I usually visit ten properties that fit my criteria. It helps me to see what is offered on the market and I can compare houses to make the best choice. I don’t know if you have ever tried this, but booking 10 visits with 10 different agents is quite a lot of pain. Most of them are working when you call them so you hit the voicemail 80% of the time. Then, you may be able to book 1 or 2 appointments the same day but it’s hard to have them one after the other. When you leave the agent do it for you, you can easily visit 5-6 house during the same day as you only need your agent availability to buy the house, not 10 agent’s agenda.




During my last article about real estate, I might have left the impression that realtors don’t do much and that you can easily put your house up for sale on your own. It is true that you can put your house up for sale without the help of a realtor but it’s not true that the guy doesn’t work. The main problem is more linked to the amount of commission you must pay to sell your property. The seller is basically paying 2 agents (the seller and the buyer), he pays also for the banner and for the office rent agents are charged monthly. This is why the 5% can hurt a lot on the sale price of your house.


But when you deal with a real estate agent to buy a house, there are no commissions to be paid! As I just wrote; the seller is paying for everything. As a buyer, the use of an agent is completely free. This sound like the perfect deal for me: you benefit from professional advice, get access to more data and have a private secretary to book your visits. Then, once you have bought your house, the cost of this service is a big fat ZERO.


This is so good that I think it’s a distortion in the market. At one point, it would even make more sense to have a seller paying a 2% or 2.5% commission fee and have the buyer paying also a finding fee to his agents. This would balance everything out and make more sense. But then again, I’m not sure I would be prepared to pay 5K-10K to an agent just to buy a house. I find their service awesome, but I would not even pay $1,000 for such support. I’m not sure there is a solution to this dilemma. In the meantime, I would still rather sell my properties myself and then use an agent for free to buy my next home.


What do you think? Do you use real estate agents when you buy?

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January 23, 2014, 6:53 am

Should I Get a Real Estate Agent?

by: The Financial Blogger    Category: Properties



Our feet are still stuck in two feett of snow but it’s time to think about what happens each spring: the largest number of real estate transactions. But here’s the catch; housing transactions conclude in spring, but they start in February. The best time to sell your house is definitely in February and March. This is when most people put their house up for sell in the hopes of finding a buyer quick enough to move in the spring or early summer time. As we approach the crucial moment to put a “for sale” sign in front of your home; the $20,000 question is: Should I Get a Real Estate Agent?

If you have read this blog in the past, you know that I’m not a big fan of realtors. However, I’ll put my assumptions aside and look at the reason why you should use a realtor and how you can put $20,000 worth of commissions directly in your pocket.




By definition, a real estate agent will take care of selling your house including all the tasks involved such as:

Assessing the property value: researching for comparables and establishing the value of the property according to the current market.

Marketing the property: completing the listing on the internet, newspaper advertising, taking pictures, writing an attractive description).

Visiting the property with potential clients: arranging visits, answering questions, using his network to attract more potential clients.

Negotiating: receiving the offer of purchase from the buyer, negotiating with both the seller and the buyers. Offering support and facilitating the sale.

Legal protection & paperwork: technically, the real estate agent is not responsible for the legal aspects of the transaction. However, he uses proven legal documents drafted by his banner. He takes care of all paperwork including certificate of localization, offer and counter offer, conditions, seller’s declaration, etc.


As you can see, it’s not like the real estate agent doesn’t do anything to sell your house. He does some work and should get paid for it; I’m not arguing with that. However, I have a problem with the bill you have to pay. Since the realtor has to pay a commission to his banner and rent an office, the commission rate the seller pays is ridiculously high. For a house selling for $390,000 (which is about the average selling price in Canada according to the Canadian Real Estate Association), a 5% commission is worth $19,500. This amount is before taxes. When I look at my wallet with the seller’s perspective, it hurts to pay 20 grand for a single transaction.




The answer to the question “should I get a real estate agent? is answered  by another question: “can you successfully sell your house alone?. Since I’ve just outlined the main realtor’s tasks, let’s see if you can do all of them and keep the $20,000 in your pocket.


Assessing the property value: Assessing a property value isn’t that complicated. You look at your property in terms of neighborhood, equipment (central A/C, fireplace, central vacuum, garage, flooring, etc), number of bathrooms and general square footage. After a few hours, you will be able to find houses similar to yours and this will dictate the price you should sell at. Just ask yourself why someone would buy your house that is $20K higher than the neighbor’s house showing similar features. And don’t answer because your place looks better ;-).

Marketing the property: 85% of potential buyers look on the internet to filter properties. Therefore, if you are able to list your property on a few well-known websites, you can reach most of the market. Writing a description of your house is not rocket science either. Just read a few descriptions of houses similar to yours and you will see what is being highlighted.

Visiting the property with potential clients: This only requires that you answer the phone and schedule appointments. In fact, most potential buyers prefer to visit the house by themselves and will come to you if they have any questions. I don’t think I really need someone to tell me I’m entering the kitchen!

Negotiating: This is probably the part where taking a realtor seems appealing. In fact, it’s not. Most people hate negotiating and that includes you and your potential buyer. If you have done your research and pulled out valid comparables, you can simply sit down with your buyer and show him why you are selling at that price. Ask him to come with comparables that validate his rationale of offering you less. It is a bit painful, but keep in mind that you are doing this for $20K.

Legal protection & paperwork: Since the real estate agent is not legally responsible if there is a problem with the transaction, the legal protection is not as important as it may seem. Then, sites like By The Owner offer legal support and a set of drafted documents where you only have to fill in the blanks.




I’ve sold two houses already. The first one was done with a realtor and the second one was sold on my own. I was only 23 when I bought my first house and dealing with a real estate agent was a complete nightmare.

#1 He confused both parties on the moving date (while insisting to be the middle man between the buyer and seller).

#2 He didn’t verify the certificate of localization (which was wrong and I had to run through various hassles to get it fixed).

#3 I didn’t sell my house at a higher price than the regular market (after doing my own research, I would have come up with the same price anyways)

#4 He cost me slightly over 10K (5% commission about 10 years ago)


But, I would be lying to you if I told you that selling my property by myself went smoothly and without hassles. After I saw the kind of service I had gotten using a Realtor, I decided to sell my second house by my own means and put in on the market with two different websites.

#1 I sold my house at the price I wanted (my house was listed in the same range as many other properties in my neighborhood)

#2 It took me 10 days to sell it (compared to 6 months with my previous house with a real estate agent)

#3 I went through rounds of irritating negotiations (the ugly part of selling on your own is when you come upon a fierce negotiator. The guy came back at each step of the sale to negotiate the price lower and being very negative about my house. It was irritating and I almost lost my temper at one point).

#4 No confusion with regards to moving, the transaction went smoothly (in the end, both the buyers and seller got their house on time and we all moved with smiles on our faces).


Overall, the process went relatively smooth in regards to the transaction but I had to deal with a tough buyer several times. It is true that I had to spend a few more hours to sell my house, but what is 20 hours compared to $18,000?


And this is my point: I understand the job done by a real estate agent but even though he works hard, the pay check is just too big for my pocket. What he does can definitely be done yourself without too much hassle. And if you hit a few road bumps in the process, ask yourself if they are worth 20K.


What do you think, should you get a real estate agent? Tell me about your story.

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December 20, 2012, 6:00 am

What to Do With Extra Space in Your Home

by: MD    Category: Properties

Do you have any extra space in your place?

One of my good buddies had a bunch of us over to his new place last month. This guy is a really handy dude. He built his old house with his father. Yes, he literally built a house. I can’t even build Ikea furniture.

As he was showing us what he had done with the place, he mentioned that he had tons of additional space now since he turned empty space into a liveable room. We then started discussing what one could do with additional space in a home, especially rooms that are never used.

What can you do with extra space in your home?


You can rent out your empty room to travellers from around the world. I recently met someone that was renting out the guest bedroom every single weekend for a decent chunk of change. I became fascinated with this idea.

What’s this all about? I checked out the official Airbnb site to see how they explained their own service:

“Airbnb is a trusted community marketplace for people to list, discover, and book unique accommodations around the world — online or from a mobile phone. Whether an apartment for a night, a castle for a week, or a villa for a month, Airbnb connects people to unique travel experiences, at any price point, in more than 33,000 cities and 192 countries.”

Sounds like fun to me. I’m sure that it’s easy to be skeptical about this since you’re letting strangers into your home. However, it’s worth giving this a shot. You take some pictures, set the rate, and the availability. Why let that additional room go to waste? Why not make some money out of it? Plus, you might meet someone pretty cool.

Couch Surfing.

Have you heard of CouchSurfing? It’s like Airbnb without the money. It’s like a social network for travellers. You also don’t even have to offer a full room. You can share a spot on the couch or a mattress in the living room.

What does the official site have to say about this service?

“Couchsurfing is a community of over 5 million members in 97,000 cities — and every country — around the world. Our website connects travelers and locals who meet offline to share cultures, hospitality and adventures – whether on the road or in their hometowns.”

What do you exchange for allowing the traveler into your home? That’s up to you. Your new friend from across the world can teach you their native tongue or they can simply cook for you.

Once again, you have to be really open minded here because you’re opening up your doors to unknown vagabonds. The good news is that you can meet a seasoned traveller that can share all sorts of stories with you.

Of course, this natural isn’t for everyone. Now, what if you absolutely do NOT want any strangers in your home?

Turn it into a gym.

This will cost you some money to get started, but it will save you money in the long run on gym memberships. A home gym is also super effective when you don’t like to travel to a gym or you get intimidated by all of the fancy equipment at the gym.

What do you really need to turn empty square footage in your home into a gym?

  • Space to do your pushups and air squats.
  • Resistance bands.
  • Some dumbbells.
  • A kettlebell for swings.

Have you ever tried working out from home? With those tools and some extra space, you can get an amazing pump!

Create a working space.

Do you have a specific space where you can just focus on your work? You can buy a desk and comfy chair to create your own working space. This can be your home office or where you go strictly to focus and get things done.

Those were the best ideas that I could think of for extra space in your room. I would love to hear from you guys about what you would do with unused space in your home.

Would you let strangers into your home? Would you rather have your own home gym?

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June 23, 2011, 6:00 am

When Buying a Home is the Best Option

by: MD    Category: Properties

The other day I released my first manual on deciding if you should buy or rent a home post-college. Why the need for this? I feel that young professionals are often misguided when it comes to the idea of home ownership. There are too many myths that exist when it comes to both renting and owning. Owning is often viewed as the best investment you can make. On the other hand, renting is seen as “throwing money away.” I put up a bunch of guest posts this week on the decision to see if you should buy a home or rent one in your 20s. Today I wanted to take the side of home ownership.

Let’s look at when buying a home is a better option over choosing to rent a place out:

You plan on settling down.

If you’re ready to settle down with your career and with life, a home can give you the stability that you need. Renting provides a great sense of flexibility. If you want flexibility, then renting is probably in your best interest. When you’re ready to settle down, a home purchase can help you get grounded. If you’ve found work in the career/company of your choice, you also might be ready to settle down. There are many instances where you can find yourself planning to settle down. I recommend a first home purchase at this point.

You’re starting a family.

This is the most common instance where we find ourselves settling down. For those of you with a baby on the way or looking to start a family in the short term future, you may want to purchase a home in a community where you would want to raise your kids. Right before I was born, my parents purchased the home that I lived in for 22 years. Starting a family can be the perfect excuse to look into that spacey home in that calm community.

You know where you want to live.

The problem with many young professionals is that a primary residence is often viewed as an investment. The problem with this thinking is that real estate is not the greatest investment. Aside from all of the taxes and expenses that go along with home ownership, you still need to hope that your home appreciates in value. You must also factor in the rate of inflation. Buying a home for the sake of a “great investment” isn’t the best option. If you want to settle down and you know exactly where you want to live for the long term future, you’re ready to buy your first home.

Looking for responsibility.

As strange as it sounds, many of us young people find it a challenge to save money for no reason. Saving money without an end goal can get either really boring or you might just spend the money on random purchases that come up along the way. I don’t want to say that a home is a “forced savings tool,” but it’s a great reason for many of us to start saving up money.

A certain sense of pride comes along with owning your own place. You’ll find yourself taking pride in the presentation of your place and the responsibility that goes along with maintaining a home. Buying your own place can fill that gap that you feel as a 20-something living at home with no real responsibilities.

You plan on renting out space.

I’ve noticed that a few acquaintances have bought a home so that they can rent out a portion of the space while building their equity. The idea here is that you own the place, live in one of the units, and rent out the rest of the place. I see this as a great opportunity for a young couple looking to get their life started. You purchase a home and get a taste of life as a landlord in case you ever planning on buying a rental property.

Those are the instances that I could think of where you would be better off owning a home instead of renting one out. Did I miss any other times when you’re better off with owning? Please share with us.

(photo credit: owlhere)

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February 26, 2011, 10:54 am

Rent Vs Buy a House (Infographic) For The Weekend

by: The Financial Blogger    Category: Properties

Hey guys,

I saw that on Mint and I thought of sharing this with you. It’s a great infographic on the decision to rent or buy a house. Enjoy!

Provided by

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