Traditional brokerages: Why so serious?

Reali Team on Aug 23, 2018

Disrupting a trillion dollar industry, to focus on the customer, tends to make you a few enemies

By Amit Haller, Reali CEO

 

 

Why Reali

While working with traditional brokerages in the past, I noticed a few things. Marketing consistency and quality was always an issue, comparables weren’t very scientific, and of course, agents seemed to give preferential treatment to their more expensive listings. But at the end of the transaction, agents still received the same high payout for their work, despite varying levels of effort and success. We were left with this overall sense that the entire process was more for the agent’s benefit than our own, and after talking to other buyers and sellers we knew, we realized we were far from alone.

At Reali, no one thing makes us different. It’s not just about our app, our AI, our in-house, salaried licensed Reali Experts, or our 2.5% cash back bonus for buyers and flat fee for sellers. It’s everything.

We’re changing everything from the ground up because we believe that the biggest benefit should be to the community of buyers and sellers who, up until now, have largely been left in the dust.

Participating in a recent panel for the San Diego Association of REALTORS, Pacific Sotheby’s International Realty CEO Steve Games gave an impassioned speech about what he perceives to be the pitfalls of flat fee pricing and foregoing traditional commissions. He wrapped his segment by sharing his personal account of having sold a home to billionaire Warren Buffett, with the closing line that claimed Buffett, “…did not ask [him] for a discount!” Well, with all due respect to Mr. Games — it’s easy to be pro-commissions (versus our salaried Experts) when your 2.5–3% is coming from multi-million dollar homes, and it makes total sense to us that a person of Mr. Buffett’s means doesn’t need to ask for a discount. But what about everyone else? What about the teachers who can’t afford to buy a home in the city they teach in? Or the young professionals who have to commute an hour and a half each way because homes closer to work seem out of reach for them?

Reali is recreating the real estate model to work for everyone.

Fueling our growth in new markets

Fast forward to 2018. Reali has been in the market for two years, and we’re expanding quickly through California, with our most recent launch in beautiful San Diego! Since our initial launch, Reali has processed hundreds of millions of dollars in home sales. In doing so, we have given back to Reali sellers by saving them thousands on commissions, and to Reali buyers, who receive thousands through our cash back bonus.

Our super efficient model and customers-first approach is catching like fire, and putting power back into the hands of the buying and selling community.

We are thrilled! (Traditional brokerages, not so much.)

Playing nice in the traditional real estate ecosystem

Just days after our launch in San Diego last month, our team received threats of physical harm from a Compass agent. Following that, REX Realty created a web page dedicated to comparing us to them, which misrepresented Reali’s offerings and what we provide. We reached out to REX to raise our concerns and the page was promptly taken down. Reali is clearly making an impact on the real estate ecosystem, and the reactions from traditional brokerages have ranged from the occasional fib about what we do, to outright threats of violence.

You have to ask yourself, with reactions this strong, what is their motivation? Are they thinking about what is best for consumers, or their own bottom line?

My and Reali’s motivation has been, and always will be, making homeownership more accessible to all. In an economy where home costs continue to rise and hard working people see the dream of owning a home slip farther and farther away, we are creating a new system that puts them first, and hopefully, brings them closer to making their dream a reality. That is our motivation, and we will continue to push forward to make this happen.

So whether you’re a buyer or a seller, I want you to ask yourself — who’s really got your back?