At TRELORA, we experience acute digging-in-of-heels syndrome on the part of fellow real estate practitioners across Denver on a frequent basis. We offer full service flat fee real estate representation backed by excellent technology, task specialization by employed agents, and better transparency and control of the transaction for our clients. The TRELORA business model saves consumers an average of $12,000 on their real estate purchase or sale. Buyers and sellers can save thousands of dollars on their transaction without cutting corners – so why won’t the industry acknowledge the benefits of technology and pass the obvious savings along to consumers in the form of competitive commissions or flat rate service?
Inman News published a Special Report in November 2014 titled Why the real estate industry does not compete on commission rates to discuss industry resistance to change –
Asked to put their finger on the biggest obstacle to competing for listings by offering a reduced commission to sellers, many cited hostility within the industry:
“Resistance to change … the ‘We’ve always done it this way’ mentality.”
“Other agents getting angry.”
“Lack of cooperation from other brokers.”
“Agents won’t show homes for less than 2.5 percent. This is the least amount will discount to (5 percent total).”
“Stigma of flat-fee listings (limited services).”
Just 14% of the 725 agents polled said they publicize their willingness to negotiate their commission rate, or provide services at a reduced commission rate, but TRELORA maintains that real estate commission rates are negotiable – every single time.
In a February 2016 white paper published by TRELORA, we made the assertion that innovation in real estate consumer technology will not replace full service real estate; rather the price of services will fall in line accordingly and consumers will become active, informed participants in the process. We don’t believe in the “we’ve always done it this way” philosophy; we believe in fair and accurate pricing, excellent service and the right of consumers to hang on to as much of their home equity as they possibly can.
The full Inman report is worth a read, but the takeaway is this: you don’t have to wait for the industry to catch up with technology and embrace a realistic pricing model. Advocate for your home equity now. Ask what you are getting for the commission rate the agent is suggesting. Negotiate a reasonable commission in your favor. Expect full service; you are not asking for an unfair price cut, you are asking agents not to take more than their fair share of your home equity. TRELORA works with both buyers and sellers for a flat fee of $2,500, clients are consistently thrilled with the results of their transaction, and we are running a successful real estate brokerage this way. If your agent says they simply cannot list your home or help you with a home purchase for less than 2.8%, ask why. It’s a conversation worth having.