How to save on real-estate commissions

Selling your home by yourself works better in a sellers' market.

Gail Bebee 15 May, 2017 | 5:00PM
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The Canadian Real Estate Association reported that the national average home price was $548,517 in March 2017, up 8.2% year over year. At the 5% sales commission charged by real-estate agents in most provinces (as reported by online brokerage ComFree, the commission on the sale of the average home would be $27,426 plus HST. Given the calculation method, commissions march in step with home-price changes and can be much higher in hot real-estate markets. For example, in Toronto, the total commission for a home sold at the average price ($916,567 in March) would be almost $52,000.

The cost of selling a home using a professional real-estate agent is a significant chunk of change, and sales commissions rise in step with escalating house prices. If you believe that the commission an agent would charge is not good value, there are ways to reduce the costs of selling your home.

To gain the services of an experienced real-estate agent for the lowest cost, use the time-tested consumer strategies of shopping around and bargaining. Identify three agents that your research has shown are top sellers in your neighbourhood. Ask each to present a proposal on a marketing strategy for selling your home, the estimated selling price and commission, and any included value-added services such as home staging.

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About Author

Gail Bebee

Gail Bebee  Gail Bebee is an independent personal finance speaker, teacher and the author of No Hype--The Straight Goods on Investing Your Money. She can be reached at gbebee@gailbebee.com; her website is www.gailbebee.com.

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