The need for an agent in the selling process is dead. Or so believes many investors that are getting their lawyers to do the hard work.
An increasing number of buyers and sellers are ditching their real estate agents in favour of lawyers to save cash.
Seasoned landlords say they get their lawyers to handle all of the paperwork and negotiation with the whole transaction costing, on average, around $1,000 including HST.
Private selling has become more commonplace as buyers become more informed and in-tune with the entire process.
But the issue ignited a huge debate amongst investors and service providers. Agents argue that sellers “usually end up getting a lower price than an agent would have gotten for them. This is likely due to the fact that in a private deal, both parties recognize there’s money left out of the equation; the commission.”
Larry Frondall, a Calgary-based underwriter, said lenders get “nervous” when handling private deals as there is a greater potential for fraud. He says that buyers would have to undertake the role of the Realtor in such cases and do all of the “leg work” including the checking of all comparable properties in the neighbourhood and pulling a copy of the property’s title for review.
The issue of security, says investors, need to be also considered. “When you open the door of your home to a potential buyer, what do you as the seller know about that person? Are they simply casing the joint for a robbery the minute you leave the place?” said one landlord.