We are far from popular belief….
Real Estate Broker Salary
The average price for properties in Quebec is about $218,000 according to 2011 www.ciq.qc.ca statistics. Taking into account an average commission of 4,5 %, we realize that by tabulating the number of annual transactions divided by the number registered brokers that the average annual salary of a real estate broker is about only $40 000 (see calculations below).
• 77 258 transactions (residential in 2011) divided by 18 828 real estate broker s (2011) = 4.1 transactions per broker
• $218,000 (average price in 2011) x 4,5 % = $9,810
• $9,810 x 4,1 transactions/year = $40 221
LESS THE LICENSE FEES, ADVERTISING & MARKETING FEES, TRANSACTION FEES, AGENCY FEES, TRANSPORTATION FEES, ETC …
(*Statistics from www.oaciq.com and www.ciq.qc.ca)
Based on common practice, with a payment upon the sale rather than at closing like other professionals, the broker comes off a little neglected especially when we take into account that he is one of the main experts implicated in one of the most important events of an individual’s life.
It is especially true that these statistics confirm now more than ever that there is an excess of brokers in Quebec. A study performed in 2003 actually showed that there was a surplus of 54.3% of brokers at the time, while 10 560 brokers were registered at l’OACIQ. The facts show that the number of transactions performed in Quebec did not increase as much as the number of brokers (70%, namely from 10 560 to 18 828).
Are real estate brokers overpaid?
Reminds us that the broker must advance time and money in hopes that the sale of his client’s house will repay the sum of his investment.
If a sale does not materialize, several hours and a few thousand dollars in publicity will vanish into thin air.
We publicly must announce that the disloyalty of some consumers, sellers or buyers cost a lot for the real estate brokers who are often had by the consumer and not the other way around.
The myth maintained by franchisers that money keeps on pouring in in real estate should be denounced immediately.
We are far from El Dorado promised by the franchisers. Under the circumstances, it can be easily understood that the current brokers may have declared that they were not paid enough for their services. All aware of these elements, the franchisers who runs “plex style agencies” maintained total indifference.
They are still interested in recruiting new brokers that will pay high rent.
Any professional service of quality has its price. When we know that the property sometimes constitutes the essence of a family heritage, it is imperative to protect it. That is the role of a professional real estate broker.”
Based on excerpts from interviews from La Presse with Mr. Yvon Poirier, real estate broker
The salary of the owner who sells by himself …
The average time to sell for a real estate broker is 90 days, much longer for an individual who sells by himself so let’s say 120 days …
First 2 weeks
You spend 20 hours preparing your file. You gather documents and photos of your property and you take action. You prepare and photocopy information sheets for visitors, acquire a fit to be seen sign, and register your property on a specialized website for $1000.
You determine the market value of your property by a licensed appraiser, for about $550. Finally, of course, you invest $850 in the wise advice and support of a notary.
“The evaluator’s report, written and argued, appraises your property at $250,000 and as any good salesman, you decide to price your house at $ 275,000″
For the following fifteen weeks, you continue your quest to find a buyer, at about 6 hours of work a week.
You receive phone calls, send information by fax and email, and organize open houses on Sunday afternoons. You place ads in the Saturday edition of a known daily at a rate of $60 a week.
17th and 18th weeks
Your efforts are finally rewarded in the 17th week of your quest, while you joyfully receive, your first offer to purchase.
With the help of a counselor? “probably your notary,” whose fees are about $300, you write up a counter-offer. Fortunately, it is specifically negotiated and agreed upon to the appraised value of your property, namely $ 250,000.
You spent 20 hours on all these steps.
The fees and expenses that you incurred totaled approximately $ 4,000. The commission of a real estate broker (4.5%) and taxes that apply would have amounted to $ 12,818. If we deduct the fees and expenses that you incur, you save a little over $ 8818 for 130 hours.
But you must take into account your hourly wage. In fact, if you lose more work hours at a time and a half rate, you must deduct these losses from your revenues also.
Of course, we must be willing to put in the time. However, the questions lie in the fact that WE SELL, ON TIME and get the SAME PRICE as though advised by a competent broker.
There will always be people who do not hire a lawyer to defend their case for income tax purposes, a painter to paint, a landscaper to mow the lawn, etc.
NEVER FORGET THAT A BROKER OFTEN WORKS FOR FREE IF NO SALE IS CONCLUDED DURING HIS MANDATE!