Is my real estate agent allowed to charge me for marketing costs?
This is an important question that you need to ask when you interview real estate agents for listing your home. Because the short answer is, it depends.
Real estate services vary greatly these days, especially as new business models have emerged.
Marketing tactics have also evolved. In today’s real estate market, marketing services are becoming more sophisticated, partly thanks to advances in technology. The marketing of your home may include elaborate staging, the posting of floor plans, designing a brochure highlighting your property’s features, filming a virtual video tour of the inside of your home, using a drone to get aerial views of your property, and holding open houses.
All of these services can be costly but could make the difference in the sale of your home. While cell phone photos may be of decent quality and you think you are pretty good at staging your home, professionals bring value to the services they provide. Professional photographers, videographers and stagers are experts at making your home look its best for buyers.
Whether you will be charged for these marketing costs depends on what you agree with the brokerage you choose and the listing contract you sign.
When hiring a brokerage, make sure you read the fine print in the listing agreement. The services may vary from brokerage to brokerage. Take the time to understand what they bring and establish what the contract and fee will include. Some brokerages may have a fee structure that could mean you might be on the hook for any extra marketing services you decide upon, and you may need to hire service providers at your own expense.
This is something you need to determine when interviewing agents and before you sign a listing agreement. When discussing whether to have a service included as part of the sale process, it is important to have a candid discussion with your agent about what the service is, and what, if any, additional fees will be charged to you.
For example, if your salesperson offers to hire a service – like a drone videographer – on your behalf, you will want to confirm in writing who will provide it, at what cost, and who will pay for it.
It all comes down to what is included in your agreement with the brokerage you choose.
That’s why I highly recommend a careful review of the document, and, as always, encourage you to have a lawyer who is insured to practice in real estate law review it with you before you sign. That way, you reduce the risk of being surprised by an extra charge above what you thought you would be paying.
If you have a question for Joe about the home buying or selling process, please email information@reco.on.ca.
This column is for general information purposes only and is not meant as legal or professional advice on real estate transactions.
Joseph Richer is Registrar of the Real Estate Council of Ontario (RECO). He is in charge of the administration and enforcement of all rules that govern real estate professionals in Ontario. You can find more tips at reco.on.ca, follow on Twitter @RECOhelps or on YouTube at http://www.youtube.com/RECOhelps.
