If you’re in the market to buy or sell a home, the chances are high that you want to know how to find a real estate agent. They can help make the process as smooth as possible. The search for that trusted professional is typically pretty straightforward. That is unless your house-hunt involves searching in a new city, province or even a different country.
That’s when the process of finding that new home, vacation or investment property takes on a whole new level of stress. And stress is the last thing any buyer wants when faced with relocation. That’s why we provided five ways to find a real estate agent in a new city.
There are ways around searching for a property in a new city or country; you could travel to the new city, province or country and spend time learning about the neighbourhoods. Or you could rent and hope to find a place where you know the new location better. Or you could get help from a professional real estate agent that knows and works in your destination city. Since most people will opt for the last option, we thought it best to provide some helpful tips.
5 Ways to Find an Agent in Your New City or Country
Because of your unfamiliarity with the area, you want a professional who understands your needs. There are five ways to find an agent in an unfamiliar city or country.
#1. Use the Internet
You could find an agent who specializes in helping people relocate to that destination using the Internet. Type in “relocation + real estate agent + city” to get a preliminary list. Then call to talk to each agent.
#2. Use a Relocation Service
Opt to use a relocation service — a company that charges a fee to help you relocate to a new city. Quite often, these services include finding short-term, temporary accommodation but not in the acquisition of a long-term property purchase.
#3. Use a Referral Service or Directory
You could use the Certified Relocation Professional directory. Keep in mind, though, that this directory is primarily for those relocating to a city within the continental U.S.
#4. Use an Affiliated Brokerage Office
Another option is to contact a relocation service that a brokerage operates. Many large brands, such as Zolo, have offices that can help you find an affiliated brokerage or agent in another city.
#5. Ask an Agent You Trust
Finally, you could ask a trusted real estate agent in your current city to recommend an agent.
Despite technological innovations and the broad reach of social media, this option continues to be very popular. Referrals can benefit home buyers seeking property in an unknown city or country. You can rely on your current Realtor to recommend someone of similar quality and standards. And yet, agent referrals get quite a bit of bad press. A few years back, an Inman survey reported that more than 41% of Realtors thought it unacceptable to refer a client to another agent without knowing the quality of service they would receive. However, more than a third believed this practice was common. Worse, almost 60% of agents believe the client never finds out that a referral fee is paid. That’s serious!
The thing is, using an agent based on a referral can work in your favour. We’ll tell you why.
How to Find an Agent When Buying Property in Canada
There aren’t many regulations regarding agent referrals in Canada, but there are a few important ones. For example, according to the Real Estate Council of British Columbia (RECBC) and the Real Estate Council of Ontario (RECO), there is a standard. Still, that treatment differs based on your past and current relationship with the agents involved.
If you have previously worked with the agent, your referring agent must disclose whether or not they get a commission. If you ask an agent for a referral but you’ve never worked together, that agent does not have to disclose the referral fees. Although they may choose to.
All this if-and-when business sounds like getting a referral fee is illegal, immoral, or unethical. But it’s none of the above.
Use Referrals to Get Exceptional Service
A referral fee is a great way to vet the qualifications of an agent you’ve never met. Why? In referral situations, the incentive is to send you to a Realtor that will provide excellent and ethical customer service. If the agent you ask for a referral doesn’t refer you to a reputable agent, then a deal probably won’t be done. No one gets paid, or, worse, both agents get painted with a bad brush.
“The typical commission fee for referrals in Canada is 25%,” explains Ken Eddy, a Calgary-based real estate agent. This rather large cut of the agent’s commission is a tremendous financial incentive for both agents. The agent you trust will probably only refer you to hard-working agents in the new place you purchase. If not, they run the risk of not getting paid themselves. By putting their reputation on the line — a referral is a time-honoured way of vouching for a person’s integrity and ability.
There Are Ethical Requirements to Protect You
Commission fees paid to refer agents are perfectly legal. However, in almost all circumstances, the expenses must be disclosed to you, the client, before any transactions are complete. It is standard for the agents to disclose this information and the agreement as soon as possible. Don’t be surprised if you don’t sign off on the document until you find a property you’d like to purchase. That’s because many agents want to ensure that a transaction will occur before making their clients fill out any paperwork.
Still, if you’re unsure, don’t be afraid to ask. An ethical agent who has your best interests in mind, won’t mind discussing how they get paid and why. But, again, transparency is critical in these situations.
How to Find an Agent When Buying Property in the U.S.
Whether you’re a Canadian buyer wanting to purchase property in another country or a foreign buyer looking to buy property in Canada — working with a referral agent across the border is different than using a referral agent within your own country. The best way to find a trusted referral agent is by asking the right people.
Although you can hunt for one yourself, the two million active agents in the U.S. might make that decision more challenging. A better option is to ask an agent in your hometown for a referral. If you’ve worked with that agent in the past, you’ll know and trust how this person works. You can also assume that whoever they refer you to will offer similar quality and service.
It is also standard practice within the National Association of Realtors (NAR). The Code of Ethics in the United States says not to accept any referral compensation without a client’s consent. If real estate agents refer you to another party they share a vested interest with, they must let you know.
How to Find an Agent When Buying Property Worldwide
The top countries that Canadians tend to buy destination properties in are the United States, Europe and South America. Using a referral agent can help you prepare for any differences in home buying in these countries and continents.
For instance, it is essential to understand that Canadian laws do not protect you if you buy property outside Canada. An agent you were referred to that lives and worked in a foreign country can help you understand those laws. They can also help with closing processes and whether there are any unique tax structures or extra costs to consider.
As it turns out, Canadian real estate is also attractive to overseas buyers. Canadian Real Estate Magazine says Banff, Niagara-On-The-Lake, Whistler and Cape Breton are top picks for investors interested in vacation homes. As a result, many Canadian Realtors work with agents in other countries to create a vetted referral list. Dylan Nite, a Vancouver-based Zolo growth manager and Realtor, is one of those agents. He has an international referral list to ensure that buyers can find everything they need. Both for people buying worldwide and those looking to buy in Canada.
“If needed, I vet a Realtor in any country they choose to go through,” said Nite. He often provides these connections for clients and colleagues.
For those still considering whether or not to buy in a foreign country, consider these three essential factors:
- Buying real estate does not give foreign owners the privilege to stay longer in that country than the typical length of time permitted. To stay longer, you must apply for a VISA or speak with an immigration lawyer;
- If you are buying property in a country that does not speak your first language, it is crucial to hire a professional. They can get you all legal documents in each language.
- Financing in another country may require a higher down payment. Or, it may prompt lenders to complete a more thorough review of your financial situation. Be prepared for a much more extended wait period on property purchases that require financing.
How Agent Referral Fees Are Different Than Finder Fees
An important thing to note is that referral fees are not the same as finder fees.
Referral fees come from a professional in one industry, suggesting another professional from that same industry. Both parties have similar education and background. This means that the Realtor has an incentive to do their due diligence before referring to another Realtor. In virtually every North American jurisdiction, real estate agents must follow a code of ethics. They need to protect their client’s interests above all else.
On the other hand, finder fees are paid by an individual who works in one industry but suggests that you use a professional that works in another industry. Each party has different education and background. This means it is difficult for one professional to assess the quality of another professional. For example, suppose a mortgage broker were to refer a client to a home inspector. In that case, the mortgage broker cannot confirm that this recommendation protects their client’s interest above all else. Why? Their lack of knowledge about the home inspection process.
However, regardless of the quality of service provided, the mortgage broker could receive a commission. Finder fees don’t require those suggesting the recommendation to do their due diligence (although some indeed do). Therefore, there is less incentive to verify the credentials and ability of the person who gets the referral and pays the finder fee.
Final Thoughts
Buying property in your city can be challenging. That means buying in an unknown city or country requires much more research and patience. Working with an agent referred to you in a new city can help make the process less stressful. In addition, it ensures that you rely on the expertise and professionalism of the agent who referred you and that both agents will feel accountable.
Regardless of finding a real estate agent in a new city or country, it’s best to consider all your options. Speak with your trusted network. Find an industry professional who will make the home buying experience feel like you’re not even leaving your hometown.
