The summer tends to be the busiest time for me, and it's fairly common for people to call up asking for quotations for their real estate matters. Recently, I received a referral from an agent that I ordinarily dealt with. Her client was involved on the sale of an upscale condominium and the purchase of a half million dollar home. After providing the quotation, the agent informed me that her client was a little concerned because the quote was $500 more than he had wanted it to be. The total cost of the transaction on my part formed about 0.25% of the purchase price.

I had a nice chat with the agent about why he was in dispute over the last $500 of the transaction when he was dealing with two transactions worth over half a million dollars. In her experience, people tend to have difficulty visualizing what the service provides. The mentality is a simplistic one that can be illustrated using a retail example: Go to a store, pay your money for the goods being purchased, walk away. When the lawyers get involved, many clients do not understand what role or value is added by their work, since many in the general population see their lawyers as "paper pushers".

Early in the day, I had another chat with another lawyer who shared my sentiments about the business. She looked back at her career and questioned how lawyers, who must take on a significant amount of liability on each real estate transaction, are basically making less than many unionized transit or factory workers per hour on each file. The general feeling between her and myself was that if we are not making a minimum amount, we don't feel good about doing the file and things tend not to be handled well. For many lawyers, that means they simply hand it off to an assistant or clerk and allow them to deal with it. That's not a knock against assistants or clerks, but it means that the lawyer simply doesn't care about your transaction, interests or wishes.

The unfortunate part of this story is that the agent will take home about 2.5% of the total transaction costs, meaning that she will make 10 times what most lawyers will charge. If you are comfortable with paying that amount of commission, then why sweat the small costs on arguably the largest investments of your life?

        

 

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