Cost of Hiring a Buyer’s Advocate

Buying a home is tedious work as it takes time, research and a lot of paper work. As such, you have two options – do it on your own or get the help of a buyer’s advocate.

The process of buying a home can be done without a hitch if one gets the services of a professional real estate agent. With a trusted professional to assist you, you can be sure to find your dream home or at least one closest to that.

The fee for hiring a real estate agent depends on their expertise, the level of service you want and the extent of the job you need. Other factors that can influence the fee are the condition of the property you want to purchase, budget, search area, specific aspects and level of difficulty.

Full Service

The fee for a full service agent normally ranges from 1.5 percent to 2 percent of the purchase exclusive of the GST. This rate is similar to what seller’s agents charge.

Home buyers can also choose an agent who charges a fixed fee. A fixed fee is already set regardless of the property’s price which can actually save you such as in the event you purchase a property at a higher cost. This fee, however, may be collected in advance depending on the type of service you require.

Specific Service

If you require help only in certain aspect of the home buying process, you can still hire a buyer’s advocate but for a specific service only. As an example, you can get the services of an agent for negotiation only. At an auction, this real estate professional will negotiate the property price on your behalf before, during and after the auction.

The fee for a negotiation only service is usually one percent of the total purchase price plus GST. Or it can be a fixed rate depending on your agreement.

If you want to be represented during auction bidding, the fee starts at $500 for each auction an agent attends. You will have to pay an additional fee on a successful purchase from that auction.

Take note that most real estate professionals would already ask for payment of a portion of their fee during the signing of contract. The initial fee can range from $1,000 to 50 percent of their total fee and is non-refundable. In some instances when the purchase of a property does not push through, the fee can be refunded.

Non-refundable fees are meant to compensate the efforts of a buyer’s advocate in searching for your desired properties or what is called their chargeable time. This should be stated in the contract to make the homebuyer aware before he or she signs the agreement.

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