New website could slash commissions

New website could slash commissions

New website could slash commissions A match-making website encouraging Realtors to bid for the right to represent a client is drawing mixed reviews from sales reps – could a similar version soon follow for brokers?

FeeDuck, a website devised to counteract and deal with the struggle of finding a competent and trustworthy agent, is a real-time auction that allows people to connect with Realtors. However, the service and general websites like it are drawing the ire of local agents who say sites such as this undercut their commissions and undervalue their services.

“We make it look easy because we are trained and we are professionals,” writes real estate agent Jerry Snel in a recent post on the REP forum. “Of course there are agents out there who can’t sell themselves because they don't really know what they're doing so they will list your home for little commission.

“If an agent can’t even negotiate his commission and show his value then why would anyone consider hiring that agent to negotiate and show the value of their home?”

Sharn Kandola, one of four creators of FeeDuck and the company’s VP of marketing, said that she and her partners came up with the idea after the arduous task of buying a house in Oakville, Ont.
 “We came up with the idea because it was a challenge for us to find an agent when we were going through the buying process,” said Kandola, whose co-founders all live on the same street and were looking for houses last year.

“So we decided to create an alternative and challenge people to use our site to find a good Realtor. We’re not here for everyone and agents don’t have to agree to represent a client if they feel their commissions and value are being compromised. This is a tool to help consumers and set them up with good Realtors and allows agents to directly connect with sellers.” 

The site serves as a middleman between buyers or sellers and an agent. The company does background checks and gathers as much information as possible on an agent before recommending them to compete for the client’s business.

The selected Realtors can then bid for the right to represent a client based on their needs and within 72 hours, FeeDuck presents the consumer with the top bidder. What’s more, the agents have no idea who the other agents they’re competing against are – only the buyers and sellers.

Nick Karadza, broker of record at Rockstar Realty, said that his brokerage is interested in the website and sees it as a positive tool for rookie agents trying to expand their client base.
“It’s another alternative for Realtors just starting out trying to connect with clients,” he said. “I can see where other Realtors might disagree but there’s enough opportunity out there for everyone. It’s what they do in the U.S. and it’s what should be done here.”

Ralph Fox, a real estate broker and consultant at Ralph Fox Consulting, said that while the website is a good thing, adding new competition to the market, there is a pendulum effect that’s most likely to occur.

“Everything is a pendulum,” he said.

“People begin to discover how hard it is to sell a property on websites like this [or meet the right agent] and when your margin for error is small, I think a lot of people will circle back to the conventional method of finding Realtors.”
7 Comments
  • KJL 2015-01-21 1:18:42 PM
    This will last about a week .... Who is determine the worth ? Half the realtors today are part time same as mortgage agents. They cannot survive in the real world so hey think they will be guru's in another field. Good luck ! Mights as well use "Angies List" !
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  • New Agent 2015-01-21 1:23:26 PM
    Was in the realty sales side for years and honestly there is little to listing a house. Agents base value on what someone else is listing for, not actual sales prices, and hope to sell. There is actually so much less work to do for an agent now with educated clients researching listings on line. Also a mortgage agent is the one who make s the sale work and gets paid less than 1%. Realtors on each side can get paid 3% of sale price. Fair to the client?
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  • Derek 2015-01-21 1:46:37 PM
    Agreed. This doesn't appear to help people find 'good' realtors, just cheap ones.
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