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Location: God's own country
Posted on: 02-04-14 00:43:58
My question is :
Is cash backs even legal?
Let me give you an example:
Kumar is a realtor of RealtyMAX.
For every house transactions that Kumar does, then he has to give 0.5% to Realty MAX.
So he is left with 2.0% as his fees.
In that he can give 1.75 % or 1 % cashback. But how will the CRA see this?
Also RealtyMAX might have a high eithic standards which state their realtors are to be entitled to 2.0% comission and that they should not give any cashbacks.
Can any realtors help us on this one?
Peace by Murali
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I am a Gents and not a Ladies.
Quote:
Originally posted by Dazzle
Quote:
Originally posted by Full House
"Cut the price of the house DOWN by $10,000."
FH.
In any transaction it is the seller who sets the price not the buyer. How can a buyer cut down the house price by $10k? Buyer can only negotiate the sale price with the seller.
Quote:
Originally posted by Full House
"It is your money, that they are giving you back."
FH.
I don't think you have ever done a real estate transaction in Canada?
The commission is paid by the seller not the buyer. It is the seller's money out of which the buyer got 1%.
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I will give you an Example here.
I am the SELLER.
YOU are the BUYER.
I bought a place and still living in it. I bought it for $180,000.00 five years ago. At the end of Five years I want to sell it for $200,000.00 Add the Real Estate Brokers 2.5% commission, so I pad it up again to $205,000.00. No one will pay the asking price unless there is a competetion for that property at that low price. So, I add another Twenty to it and make it a round $225,000.00
Now you come along see the place, and find the place pretty good but find it slightly high and say you will pay 200,000.00, we higgle haggle and settle it at 210,000.00 You feel you got a good bargain.
I feel I also got a good deal which is $204,950.00 cash. I also pay the R.E.BROKER $5050 FROM THE TOTAL-- Commish.
NOW, you figure this one out for yourself. If you bring in another agent, who is a buyers agent, he gets a cut out of the broker who is selling it. That is the money you paid into the deal. Yes, you got a piece of the action from the sale. I also know of cases, where the broker who sells, brings in the competetion, a lots of guys bidding for MY property, I get $225,000.00, all of what I asked for and I pay $5612.50 as commish. You paid 225,000 for the same house in this case. NOW you go and figure this one out too.!! You sure get a piece of the action also.
You got a very beautiful house for $225,000.00.(Bucks) I am really happy and you are too.
Thats real estate.
FH.
DUPLICATE.
Quote:
Originally posted by tamilkuravan
My question is :
Is cash backs even legal?
While I am not a lawyer, I am quite confident that it is legal. Rogers has a set up a business around this rebate aspect - zoocasa.com.
The thing is that many people are not aware of it. Realtors don't want to let anyone know (for obivious reasons) and if someone brings up the topic, they shoot it down saying that only low quality agents resort to these kinds of frills...we provide best service to our clients...blah..blah...
This is what I feel, 5-years down the line, all agents will have to accept these terms. Trading commission charged by stock market firms is a good example, 5 years ago, most brokerage firms were charging $100+ per trade. With the advent of discount brokers, commission rates have gone below $10/trade. The reality is real estate brokerage is a commodity business...and therefore fees should reflect that.
Location: God's own country
Posted on: 09-04-14 09:47:31
RaOne,
What you donot understand is that MLS has a monopoly and it wants to run as monopoly.
The moment it starts/ allows its brokers to accept whatever charge that they want to charge legally, then the whole MLS system will be unattractive to brokers. So they will never allow it legally.
Why has the MLS system not failed till now? There are many other systems (like sell by the owner etc) It is because, it is the only system that can pinpoint the rates at which similar houses were sold for in your locality (due to its monopoly) and hence can make you bench mark the price for your property.
Hope this helps.
Murali
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I am a Gents and not a Ladies.
