Last night I received a company wide email from one of our "top brass" urging me to turn on 60 Minutes to view their story on discount online real estate brokers and the demise of the 6% commission. Based on this report which was comprised of a "smart" appearance by Glenn Kelman of Redfin, and the frightening "rebuttal" by ReMax agent Deborah Arends (check out her marketing plan), even I came away feeling disdain for my own industry. But heh, that’s nothing new if you read this blog regularly. It’s no secret that a multitude of real estate agents across the country are providing little or no real service for the amount of commissions they charge. This is precisely why services such as Redfin will continue to gain footing and change the face of our industry by providing more options for home buyers and sellers. This is the most widely discussed topic in my industry and the one that brings the highest levels of anxiety to most traditional real estate agents. If you or someone you know is one of these agents, be afraid, be very very afraid.
I feel fortunate to be working in the Manhattan real estate market where I believe full service brokerage will outlive most other markets around the country. I also believe that those in my industry who bring more to the table than simply sending out flyers and mailing postcards (are you kidding me?) will continue to be sought out for representation in real estate transactions. Marketing expertise and negotiating savvy can be worth a significant amount of money when the average market price is $1.4M. Of course, as I have said in the past, a broker shakeout is coming. Having said that, I still don’t see Redfin handling the sale of a $24,000,000 celebrity apartment on Central Park West.