Quote:
Originally Posted by Gerbs
@JDMStyo
My friends who are realtors seem to consistently kickback 25 to 50% on their buy-side purchases. Do you think that's necessary to stay competitive in the Greater Vancouver market? Or it's just something they do when they're starting out and will reject this kickback in their later years.
They closed 30+ properties this year and that would cut their earnings in half.
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Quote:
Originally Posted by Gerbs
@JDMStyo
My friends who are realtors seem to consistently kickback 25 to 50% on their buy-side purchases. Do you think that's necessary to stay competitive in the Greater Vancouver market? Or it's just something they do when they're starting out and will reject this kickback in their later years.
They closed 30+ properties this year and that would cut their earnings in half.
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Gerbs,
Buying realtors if anything take lots more expenses - driving around, time, printing tour sheets, it's a real grind for when you're starting out.
If they're doing 30+ a year they are doing well - if you average $500K per property you are likely grossing $8,000+ per property.
x30 = $240,000! That's a pretty good number... until you look at expenses side.
Expenses and obviously marketing costs (rebates to clients, dining, gifts, marketing expenses, realtor fees, license fees, etc) can take a big chunk out of that. If they are REALLY discounting 50% on all deals (before tax), they may not be making much at all NET. Still at 30+ deals a year they are definitely ahead of many realtors in the industry, most average less than 5 a year (stats). In that instance they would be wise to incorporate and build out a PREC (Personal RE Corp) to defer taxes and income for leaner years.
I don't think a 30% rebate back end of the day especially for a larger house ($1-2M) is unreasonable but in my own experience most people who appreciate your efforts and fact you got them a good deal / sold property for more $ isn't going to nickel and dime you for an extra $2-3K.
With low rates again and presales heating up - if I got anyone a great smoking unit that 5 other people will write with me with no ASK of 50% rebate, guess who I'm calling first?
With most things in life, you get what you pay for.