It’s time to sell your house and you are thinking of using a discount brokerage to save thousands on real estate fees while still using a REALTOR®. It seemed like the perfect plan until someone told you they’ve heard other agents won’t show your property, (known as steering in real estate) and now you’re wondering if that’s true.
If this sounds familiar, you’ve come to the right place! This article is going to answer your question, and share insights and statistics you can use to make an informed decision for yourself. Afterall, there’s a lot of money riding on this decision.
Real Estate Professionals are Not Everyone’s Favourite
Did you know that real estate agents are one of the most disliked professionals out there? In fact, they don’t rank much above car salespeople and politicians. Ouch!
But you’re probably not really surprised. As much as we hate to admit it, we certainly aren’t surprised! REALTORs® have a reputation of being spammy, salesy and just kinda gross.
Despite the agents working diligently to change this narrative, given this long-standing stereotype, it’s not hard to see why consumers are skeptical.
With discount brokers, or agencies that charge lower commission rates, one of the most common questions people have is ‘will other agents show my house?’ It’s a really good question and one that deserves consideration.
What is Steering in Real Estate?
In real estate, the concept of an agent not showing, or otherwise discouraging their buyer clients from looking at a property is called ‘steering’. What’s important to know about steering is that not only is it unethical and against the Canadian Real Estate Association code of conduct, it’s also illegal.
It is important to note here that the Saskatchewan Real Estate Commission takes steering, and any agent misconduct extremely seriously. In fact, they even publish disciplinary hearing information so you can make an informed decision about who you choose to work with.
Why Steering is More Myth than Reality – a real life example
Before we deep dive into the technical aspects of this concept, let’s look at this from another angle with an example. While there are many sales professionals we could use as an example here, we’re going to go with car salespeople. They’re already at the bottom of the ‘likable’ list with us, and there’s no need to drag anyone else down here.
Think about the last time you bought a new vehicle. Or, even just the last time you went to look around a car lot. If you felt a little shudder at the thought, just stick with us!
Let’s pretend for our example that you are in the market for a new minivan. We know – you swore up and down you would never drive a minivan, but now that you have multiple car seats and you’re loading hockey bags in and out on the regular, you’ve succumbed to the fact that who you were as a hypothetical parent is not really the parent you’ve become.
So after doing some research online, you’ve decided that you’re looking for an import model minivan, because #gasmileage.
You decide to head to the Toyota dealership first. You have a look around the lot and their salesperson comes out to help. They tell you all the great things about a Toyota minivan, go over the options, talk about pricing, and then want you to sign on the dotted line.
You like the van, everything sounds good, they even have your preferred colour in stock, but you want to look at the Honda minivan too before deciding which vehicle is right for you. This is a big purchase and it’s important to do your research. So you let the salesperson know you’re going to check out the other dealership and you’ll be in touch.
Now, what do you think is going to happen when you say you’re going to look somewhere else?
Does the salesperson give you driving directions to the other dealership, tell you the great things about their vehicles, connect you with another salesperson and wish you well?
OR
Do they suddenly start telling you even more things about the Toyota? Do they start to throw in some extra options, and maybe even trim a little off the price? Probably.
And here’s the other thing they usually start to do. They begin to tell you all the reasons why you shouldn’t buy a Honda (or any other model for that matter).
They give you plenty of reasons why the Honda is an inferior vehicle and why you should stay away from it.
But is the Honda really an inferior vehicle? There’s always personal preference of course, but overall is the Honda van really as bad as the Toyota salesperson says?
In order to say for sure, you would look at the facts. How do the features compare? Things like fuel mileage, cargo size, reliability, and price are facts that you would compare and contrast to determine for yourself which vehicle suits you best.
You would research them both, compare and contrast, maybe even write up a Pro/Con list if that’s your thing, and then make your decision.
Now, let’s get back to real estate and how this story relates.
Does Steering in Real Estate Happen?
Despite being unethical and illegal, the truth is steering can happen. Just like in our car example, the same thing can happen in real estate. CBC Marketplace ran a story in 2021 about agents steering buyers from low commission homes in Ontario.
Before you jump to the conclusion that nobody will show your property if you list with a discount brokerage, let’s examine the facts, because they show that the perception is that it happens a lot, but the reality is very different.
Why Steering Appears to Happen More Than it Does
While steering can and likely does happen, the statistics would suggest that the bark of steering is far worse than the bite. What we mean by that is that people talk about it happening way more than it actually happens.
The concept of steering is not unique to real estate, it’s simply a reality of any industry that involves sales. Our example is about car sales, but the same can be said for retail sales too. People don’t always have good things to say about discount brands like Walmart either, but when you’re the one paying the bill Walmart might be the best choice.
At the end of the day, salespeople are sales people regardless of what they are selling. In any industry with commission based sales, if they don’t make the sale they don’t get paid.
Steering is much more of a sales tactic than a reality. Planting seeds of doubt is a common strategy people use to close a sale, despite the fact that those seeds aren’t supported by fact.
You can probably even think of someone off the top of your head in your own job who does things that you consider shady or unethical. That person’s behaviour is unfortunate, but it certainly isn’t representative of your industry as a whole.
Bringing It All Home – How It All Relates to Real Estate
Only one REALTOR® can list your house at a time. When you start looking for a real estate agent to sell your home, you’re probably going to interview at least a couple of agents before deciding who to work with.
Only the agent who successfully demonstrates to you that they are the best person for the job, has a chance to get paid. And while they don’t get paid until your house is sold, they can’t get paid on a listing they don’t have.
Each agent will do their best, one way or another to convince you how and why they are the most qualified to work with you. What we often find is that people who don’t have the skills or experience to shine a light on why they are the best for the job will cast a shadow on everyone else in an effort to make themselves look better.
So if you’re considering using a lower commission real estate brokerage to sell your home, let’s look at some insights. While we can’t speak to any other companies, we can share our statistics with you.
In 2022, approximately 98.5% of our transactions were completed with cooperating brokerages. That means of all the sales we did in 2022 (and we do a lot for a brokerage of our size) almost all of them were done with agents from other companies.
Other things to consider include:
- Buyers find their own properties online and ask their agents to see them.
- Agents are still being paid a commission, it’s just a smaller percentage.
- A person who is going to steer, is going to do so for any number of reasons, not just because of the commission. They’re only in it for themselves.
- Real estate agents get into the business to help their clients, not hurt them. Don’t let the odd bad apple and one media article give you the wrong impression.
It’s like the saying goes “one person ruins it for everyone”. The same is the case here. While steering is possible, it’s rare. The majority of real estate agents in Saskatoon are ethical and operate in the best interests of their clients.
So the answer is Yes, other agents will show and sell your property if you list with a discount brokerage.
When it comes to selling your house with a real estate agent, the most important thing you can do is find someone you trust. Working with a REALTOR® can be an incredibly rewarding, successful and even affordable experience.
Check out these great resources to help you have a great selling experience:
- 3 Better Questions to Ask When Hiring a REALTOR®” ebook
- Ultimate Guide to Selling Your Home in Saskatoon.
