Two Per Cent Realty offers 'alternative' to high cost, high stress

水管工

$10,000 commission on half-million-dollar house is adequate compensation, realtor says
7 y8 I- P- J1 URon Chalmers, The Edmonton Journal
Published: 2:50 am
EDMONTON - Ray Almog calls his Two Per Cent Realty "a third alternative" between higher-priced realtors and higher-stress sale by owner.
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7 A0 n$ T2 n1 o, ~, ]+ L& ?Almog opened his business in May and now has two other realtors as well as himself selling homes for a flat rate of two per cent of sale price.

That's adequate compensation, he says, with a $500,000 deal bringing a gross commission of $10,000.

*Almog attracts most of his customers through lawn signs and a website. He says 20 of his team's listings have sold, mostly in the west end.

- W, M  ^" G9 M$ TTwo Per Cent listings can be sold by any realtor who is a member of the Multiple Listing Service, Almog says. "About 85 per cent of our sales have been by other realtors."
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5 k/ o( F0 f* s7 fHe pays half of the gross commission to the selling realtor.

5 n) {3 Z! a% j: B, IThat's a lot less than half of the common commission of seven per cent on the first $100,000, then three per cent on everything above that. But Almog says other realtors don't hesitate to show his properties.
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On a $500,000 sale, "that's $5,000 in their pocket," he says. "It's still a lot of money."
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Almog says "only a couple" of competing realtors have objected to his low commissions.
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The "seven-and-three" commission is "quite steep for a seller," agrees Michael McNeil at Esquire Realty Inc., which he calls a "discount brokerage."
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1 ]% h' ^# Q' \: {: ?Esquire charges a flat rate of four per cent for homes under $300,000, or three per cent for higher-priced homes.

"And we give $500 cash back to a charity, in the seller's name, so they get the tax receipt," McNeil says.

Esquire has eight realtors in Edmonton and 25 in Calgary.
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Carolyn Pratt, president of the Realtors Association of Edmonton, says realtors are prohibited from fixing one standard rate. "All of our commissions are negotiable," she says. "They can charge whatever they want."

Wayne Moen, a realtor at Re/Max River City, says discount brokers don't bother him.

"I think everybody welcomes competition," he says -- but insists that competition also extends to performance.

/ M. r; ~, d; x$ o  E"There are different levels of service," Moen says, suggesting that any home seller who is choosing a realtor should ask what services he or she will provide.

While "seven-and-three" is a common commission, it's far from universal even among big-name companies whose realtors often take less, Moen says.
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rchalmers@thejournal.canwest.com