- Elias Zeekeh, MBA, CPA, CMA
Realtors Slash Fees in Hot GTA Market
Detached single family home prices in Toronto rose to beyond $1.5M in February of this year, and given the sky high prices real estate brokers have become more flexible to discount their commission rates down to 1 percent. Additionally, discount brokers can also include more services than they have historically, while this wasn't as economical in years prior. Generally speaking agreements will include listing on the MLS, negotiations, and contract; but marketing services such as photography or staging may not be included or may be of reduced quality with a discount broker.
Furthermore, it should be noted that higher commission agents are generally more experienced, but this isn’t a hard and fast rule as experienced agents are also willing to discount to some degree in a high demand market with a declining number of listings. Overall, you will need to balance the commission rate that you are paying with the services being provided and the experience and track record of the listing broker. Lastly, note that a 1 percent commission from your listing agent will mean you’ll pay 3.5 percent commission as the buyers broker is paid 2.5 percent. The exception to this is if your listing agent finds the buyer.
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