How does Purplebricks work? In this video, Jeb Smith, Huntington Beach Realtor with Coldwell Banker Residential Brokerage discusses the Discount Brokerage Model and why hiring a discount broker like Purplebricks could end up costing you more money.
Below are some of the Reasons that I touch on in the video
1. Not necessarily local expert (which is their #1 pitch) – cover a large area in most cases
2. Managing a large portfolio of homes, hard to return calls and answer questions, etc…..
3. Agents are usually newbie agents or non-producers as why would anyone leave a successful business to work for next to nothing?
4. Agent gets paid upfront when taking listing (Fee of $1000). No incentive for them to help you sell your home unless they double end it which if that is what the agent is going for they make it difficult for other agents to show, etc….Also have to upload offers into a system and schedule appointments online. These types of things make agents not want to show homes and in some cases taking buyers out of your potential pool of buyers
5. No Exposure outside of Sign and MLS (no additional marketing outside of initial photos and matterport floor plan)
6. Due to the number of homes they are managing and being paid upfront they have no incentive to help you negotiate or get the most amount of money.
7. Were headed into a market with more inventory and where days on the market are going up which means you need to have an agent who is willing to pull out all of the stops in order to help you get your home sold (marketing through all mediums), staging if necessary………the small things that help a home stand out.
8. If there is an issue that arises during the transaction where the Seller is unwilling to give in and the agent on the other side isn’t willing to help, there is no chance an agent making $1000 is going to step up to resolve the problem and help the deal close. Real Estate is all about negotiation and it doesn’t stop at accepting an offer, this is why you hire a professional. Everyone is a professional until you actually need one.