Not all real estate practioners are created equal. Only members of the Canadian Real Estate Association, an association comprised of over 84,000 real estate professionals from coast to coast, can call themselves REALTORS®.
They proudly display the REALTOR® logo on business cards and other marketing material. This exclusive designation symbolizes a commitment to competence, service and professional conduct.
In the quest to meet these high standards, REALTORS® in Canada have been bound together by a code of ethics since 1959. They commit themselves to professional and competent service, absolute honesty and integrity in business dealings, co-operation with and fairness to all, and personal accountability through compliance with CREA’s Standards of Business Practice.
There are actually 27 articles contained in the Standards of Business Practice. They obligate a REALTOR® to very high standards such as being informed on all essential facts affecting current market conditions, full disclosure of their role in a real estate transaction, their primary duty to a client, discovery of facts pertaining to a property to avoid errors or misrepresentation, written service agreements for selling properties, written transaction agreements, skilled and conscientious service and accurate promotion and advertising of properties.
Under each article, there are often a number of interpretations related directly to the standard described. For example, under Be Informed of Essential Facts, interpretations indicate “a REALTOR® shall attend educational programs and courses which will assist them in remaining up-to-date and aware of matters that could affect any aspect of a real estate transaction; a REALTOR® shall be aware of current legislation and, wherever possible, be aware of pending legislation (including zoning, government programs etc.) which could affect trading conditions in the marketplace; a REALTOR® shall be aware of appropriate financing procedures, mortgaging requirements, etc., in order to properly discuss financial obligations on any transaction; and a REALTOR® shall be familiar with the contents of the most current forms commonly used in real estate transactions.”
Consumers should expect professional and competent service when they are dealing with one of the biggest financial investments in their lifetime. The use of a REALTOR® is exceedingly important in the present market because most transactions are now well in excess of $100,000 (e.g. Winnipeg’s average MLS® residential-detached price in July 2006 was $161,000). Considering the small upside cost relative to the value received and the potential large downside risk, it would be unwise and even foolish to consider a deal in real estate without the professional assistance of a REALTOR®.
A recent example of the value of using a REALTOR® was shown when a couple in Winnipeg wisely called a REALTOR® to seek counsel and advice on selling what they had come to conclude was a vacant lot. In reality, this lot still had an older fixer-upper home on it. Instead of demolishing the home which the owners seriously considered and even pricing the demolition cost, their REALTOR® used his marketing knowledge to inform them there was another option. He told them to list the property on the Multiple Listing Service®. The result was that the home sold as a handyman special for approximately $30,000 above what they would have received if they had opted to tear the house down and sell the property as a vacant lot.
There are many stories this year of vendors
receiving top dollar for their properties. Dollar volume on the Winnipeg Real Estate Board’s MLS® had gone up 18 per cent at the end of July. Roughly half of all residential-detached properties sold on MLS® this year have been at or above list price.
Also, houses this year are on on average only on the market for three weeks. Houses in a number of price ranges in desirable neighbourhoods are even selling quicker.
Not surprisingly, a 2005 study by the National Association of REALTORS® (the U.S. counterpart of CREA) showed that sellers who use a REALTOR® obtain a 16 per cent higher home price than those who sell on their own.
Why are Winnipeggers and Canadians more than ever before using a REALTOR® to help them buy or sell a home? Here are just a few good reasons:
• Your REALTOR® can help you determine your buying power — that is, your financial reserves plus your borrowing capacity. If you give a REALTOR® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you.
• Your REALTOR® has many resources to assist you in your home search. Sometimes the property you are seeking is available, but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.
• Your REALTOR® can assist you in the selection process by providing objective information about each property. Agents who are REALTORS® have access to a variety of information resources. REALTORS® can provide local community information on utilities, zoning, schools, etc. There are two things you’ll want to know. First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?
• Your REALTOR® can help you negotiate. There are a myriad of negotiation factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or equipment. The purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you which investigations and inspections are recommended or required.
• Your REALTOR® provides due diligence during the evaluation of the property. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few.
Your REALTOR® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports. You will also want to see a preliminary report on the title of the property. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations, for example, easements (access rights) for utilities. Your REALTOR® or real estate lawyer can help you resolve issues that might cause problems at a later date.
• Your REALTOR® can help you in understanding different financing options and in identifying qualified lenders.
• Your REALTOR® can guide you through the closing process and make sure everything flows
together smoothly.
• When selling your home, your REALTOR® can give you up-to-date information on what is happening in the marketplace and the price, financing, terms and condition of competing properties. These are key factors in getting your property sold at the best price, quickly and with minimum hassle.
• Your REALTOR® markets your property to other real estate agents and the public. Often, your REALTOR® can recommend repairs or cosmetic work that will significantly enhance the salability of your property.
Through the co-operative network of 1100 local REALTORS® and 84,000 nationwide, there are many qualified buyers ready and willing to buy your property. The exposure of your property on MLS® is absolutely amazing. There were just shy of three million unique visitors who used mls.ca and sia.ca (French site) in July which was a record for the month for the websites, according to ComScore Media Metrix. The record for the most page views generated in a 24-hour period was set April 3, 2006, when 11,160, 508 individual pages were displayed.
• Your REALTOR® will know when, where and how to advertise your property. Washington-based National Association of REALTORS® studies show that 82 per cent of real estate sales are the result of agent contacts through previous clients, referrals, friends, family and personal contacts.
When a property is marketed with the help of your REALTOR®, you do not have to allow strangers into your home. Your REALTOR® will generally pre-screen and accompany qualified prospects through your property.
• Your REALTOR® can help you objectively evaluate every buyer’s proposal without compromising your marketing position. This initial agreement is only the beginning of a process of appraisals, inspections and financing — a lot of possible pitfalls. Your REALTOR® can help you write a legally binding, win-win agreement that will be more likely to make it through the process.
• Your REALTOR® can help close the sale of your home. Between the initial sales agreement and closing (or settlement), questions may arise. For example, when unexpected repairs are required to obtain financing or a clause in the title is discovered. The required paperwork alone is overwhelming for most sellers. Your REALTOR® is the best person to objectively help you resolve these issues and move the transaction to closing (or settlement).
So, if you are thinking of buying or selling a home, get a REALTOR®.
Get on MLS®.
REALTORS® get the job done, professionally and efficiently.