All very good points and thank you for the feedback!
To clarify, I am by no means trying to undermine what realtors do and what they get paid, however, I'm just trying to wrap my head around a few of the concepts. I'm actually thinking of getting my license myself at some point, and thus the reason for asking these questions as I feel there is a downward trend in potential revenue as more of these types of offerings are more common place.
From what I understand, realtor commissions have not changed in over 30 years, with typical being 7% on the first 100K and 2.5-3% on the balance. So on a $400K house, that's $17K in commissions split b/n the buyers and sellers brokerages. Of that the agents will get a %, depending on their agreement with their brokerage. Whereas, with say 2% Realty, the commission would be $8,000, split as negotiated. And for that $8K, they are offering:
- Full MLS.ca exposure to the general public and all members of the Real Estate Board
- Extensive marketing for maximum exposure of your property in multiple social media platforms and online at 2PercentRealty.ca
- Concise and professional completion of all paperwork relating to the sale and or purchase of your property
Comprehensive and expert analysis of current buying and selling trends in the Real Estate community
A Free, 2% Realty` consultation to clearly understand your expectations, requirements, budget, and timeline
So my question, as a seller, by paying an additional $9000 in commissions, what additional value and services am I getting? Also, on that same $400K house, the seller would have that same amount in price "wiggle" room, which may entice a quicker sale?
In the past (on the buyers side) realtors had to do much of the primary work themselves (ie. drive around to every property to "scout" for their buyer clients). Now, much of this is done online by both the realtor and buyer. As a buyer, even if I have a buyers agent, I am going to go to MLS first and do my homework. I know the neighborhood, style of home and price range that I am looking for. Then I phone up my realtor and ask for more details on the homes that I'm interested in, and will only view the one's that I'm truly interested in. (But maybe I'm different than most people shopping for homes).
In looking at a number of listings from some of these companies, the properties don't appear to be "sub-par" or in poor condition. Perhaps a % of buyers and sellers in the market are getting more savvy and not willing or prepared to the big bucks any longer, although there is still a segment of folks that will pay someone whatever it takes to get their home sold.
Thanks again for all your input!