Technology has impacted the way people find homes, research neighborhoods, and compare prices; in essence, buyers are able to get much of the initial legwork done by sitting at their computer or scrolling on their smart phone. Nevertheless, when it comes to actually buying a home, about 90% of buyers still use a hired real estate agent to help them with the actual offer and contract negotiations according to a report released by the National Association of Realtors.
In an article published by Forbes, its noted that “… buyers and sellers can get to the “one yard line” without much help. But deals rarely get done unless an agent is acting as middleman.” Real estate agents, without a doubt, add value with their professional expertise and negotiating experience. However, the sticking point for many is the large piece of the sale that the agents get for their commission. In many cases, the seller pays a total of 6%, with the buying and selling agent getting 3% each.
The concept of direct sales, hasn’t yet taken over the real estate market and certainly hasn’t made real estate agents obsolete; in fact, realtors may skip showing homes whose sellers aren’t willing to pay the 3% commission. Yet, technologically based real estate companies are still searching for ways to compete with the current real estate agent.
Case in point, companies such as Opendoor, you simply “type your address into Opendoor’s website, submit a few photos, and it will make you an offer within a couple of days. No open houses, negotiation, or waiting months for the buyer to come up with the money. In fact, the average closing time from the first offer is less than 20 days,” according to the article written by Stephen McBride. Some experts believe this type of business could change the way people buy and sell houses and the agent’s role in the transaction.
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