Reply to Recent experience selling with Redfin in Bethesda or NWDC?

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[quote=Anonymous][quote=Anonymous]I welcome Redfin ushering a new era for real estate transactions, where buyer brokers make little money[/quote]

I could see a new model evolving where sellers' agents pretty much do the same thing they did before, but buyers' agents are transformed into agents who truly work for the buyer and not the deal.

Perhaps home shoppers will do more to find houses on their own. They could still get help from a buyer's agent, but probably would have to pay for that service. I would think the massive time suck of helping prospective buyers find and tour houses for months or years on end would no longer be worth it to most agents who represent buyers. After the consumer has found a house they are interested in, the buyer's agent would step in and offer advice about how to structure an offer (e.g. whether to do a pre-inspection, whether to waive contingincies, whether to offer over asking -- all of which would require them to be up 
 on market conditions in the region and neigborhood). The buyer's agent would then write up the offer and submit it and negotiate on behalf of the buyer. They could charge a flat fee for that service -- in the same way that people pay home inspectors a flat fee for a pre-inspection.  If the offer is accepted, let's say the buyer's agent gets a bonus of an agreed-on amount, paid by the person trying to buy the house. If the deal closes, the buyer's agent gets another bonus of an agreed upon amount. Unlike before, these fees would be paid directly by the buyer. So prospective buyers would have to pay just to put in offers (if you want to use a buyer's agent -- presumably the seller's agent could arrange for dual agency if desired).

This would ensure that homes are priced lower than they otherwise would have been  (because the seller is only paying one agent with the commission). And it would incentivize buyers' agents to truly represent buyers' interests and demonstrate their value in doing so -- otherwise buyers aren't going to hire them. I'll grant that it could also reduce competition for houses -- because buyers would have to pay a fee just to put in an offer -- which would be bad for the home seller, because they would probably get fewer offers than under the current system.

It'll be interesting to see how this evolves. There really does -- finally -- seem to be some potential for market disruption in the real estate industry.[/quote]

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