The late summer and fall feast of real estate transactions is beginning to wane in many areas of America, and you are probably lifting your head up from the busiest season in your real estate career. Across the nation, brokers reported record transaction volume in units and dollars. Wow! The market demand for homes in America is impressive, and we, too, have seen record growth at Buyside.
Brokers need to be ever vigilant in assessing disruptors, or they will win. While you have been busy, they have changed their business model.
Referrals are key.
Just about every online portal today has changed their business model. They do not want to charge brokers or agents for advertising, or charge for leads. Now, when portals introduce you to a consumer, it’s a referral fee. Sometimes the referral may be quite reasonable, sometimes they want 30 percent of the commission. When you look at the projected referral revenue for portals, you will easily see that it is in the billions. That scares me, and it should scare you, too.
Brokers in America have one strategy that is different from any industry in the world. Brokers agree to cooperate with other brokers. A great example is the MLS. Cooperation has also been exhibited in the Broker Public Portal with Homesnap. Now available to more than 1 million agents, Homesnap is ranked somewhere in the Top 10 real estate search sites in America, with no referral or pay-to-play nonsense. Brokers own it either through their MLS or directly as shareholders.
Buyside is fighting back, too. Buyside was embraced by the firm members of the Leading Real Estate Companies of the World®. They are providing our service to all of their members. They are cooperating to create a network of homebuyers they can connect directly to home sellers. I believe this cooperation among brokers could be the spark of innovation that reshapes real estate.
Imagine a future where real estate agents and brokers do not need to advertise listings. Brokers simply connect registered buyers to properties as they become available. Our largest firms, including Howard Hanna, Fox & Roach, and others, have already demonstrated that it works. They are shifting the listing presentation by leveraging their registered homebuyer data. Their agents walk into a listing presentation and say, “I have 27 buyers for your home today. Sign the listing agreement and we will set up the showings.” They have effectively created a buyer MLS.
BuyerMLS was the original vision for Buyside, as some of you may recall. Now, cooperation among brokerages on Buyside is creating a network effect that is changing the industry. For decades, home sellers chose a listing agent and broker on the strength of trust, brand and the ability to find buyers. Today, home sellers are beginning to expect that their agent or broker already has a buyer for their home. Join us in the quest to cooperate with other brokers on Buyside. It’s a game-changer for brokers, and a hedge against the tyranny of portals.
Charles Williams is the founder and CEO of Buyside™, the real estate industry’s first buyer marketplace to collect and analyze real-time demand for any home. For more information, please visit getbuyside.com.