With close to 70,000 registrants within the Toronto Real Estate Board, almost everyone knows at least one or two Toronto Realtors.
Whether it’s a local “specialist” you regularly receive flyers from, or a friend of a friend, or even someone in the family, there’s no shortage of agents to choose from when it comes time to buy or sell a property.
But beyond the fact that not all agents conduct their business equally, or produce the same results, which I’ve discussed at length in the past, the biggest problems I’ve seen within the agent relationship, are when clients choose to work with a friend or family member.
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As the Saying Goes…
There’s an adage I’m sure you’ve heard; that you shouldn’t mix business and pleasure, which I believe to be generally true but very often when I’ve encountered a Toronto Realtor that represents friends and family it’s less about business and pleasure mixing, but rather just bad business.
This usually plays out in either one of two ways and almost always ends the same way, with disrupted relationships and poor financial results.
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Reason #1 Why You Shouldn’t Hire Your Friend
The first way this happens is that someone either assumes all Toronto Realtors are the same and doesn’t conduct any due diligence before signing on with someone they have a preexisting relationship with, or the sign on with a friend or family member because they are getting a “good deal”.
I actually worked with an agent earlier this year who was listing one of his cousins’ condos that had been on the market for months and during the negotiations, he kept complaining that he was doing this basically for free after all the costs associated with the listing and was quite clearly frustrated about having to continue to put any effort into the process.
My client and I ended up walking away from that unit, much to the listing agent’s chagrin, but it was clear that his relationship with his cousin was distressed, and they had both underestimated the amount of work and professionalism needed to get the job done right.
This is the most classic case of mixing business and pleasure, but in truth it was just bad business. When you cut through the fact there was a relationship in the example above, this was just a Seller trying to save money on a transaction. The unit did end up selling for much less than I believe it could have, and I’m sure those two will never work together again.
What do you do if you’ve hired a friend and it’s not working out? Can you fire a real estate agent? Read this post right here to find out.
Reason #2 Why You Shouldn’t Hire Your Friend
The other way this scenario can play out poorly is not about the commission, but rather the level of service.
Even when you are employing a friend or family member to represent you and agree on a fair commission, the agent is often underprepared and/or underdelivers on the level of service.
This usually happens when a homeowner believes their property is worth a set amount and will sell at a market price regardless of representation, presentation, or any negotiation. I see this a lot with Estate sales, where an agent related to the family lists the family home without touching the property or promoting the listing in any way shape or form.
Truth be told, these are excellent listings to target as a buyer because you can often gain the upper hand when negotiating and ultimately secure a good price. With estates specifically, no one seems to really be the wiser as the proceeds of the funds are generally dispersed among the beneficiaries of the estate, but that doesn’t mean the estate couldn’t have seen a more successful result.
In other scenarios, where a Seller has chosen to work with friend or family member with any further due diligence about what and how their property will be listed and the level of service is nonexistent, properties will either sit on the market and not sell, or eventually sell with lower-than-expected results.
And believe me when I tell you that selling your home and moving in general, is one of the more stressful things you can do in life. And should you find yourself in a very stressful situation with a close friend or family member the results can be even worse than financial loss.
Looking for more selling advice? Read these posts next:
- Should I Renovate My Home Before Selling?
- Are Discount Real Estate Agents Worth It?
- Why Your Home Isn’t Selling
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