August 12, 2020
The first home purchase is easily one of life’s most momentous occasions – and selling it is just as big an occasion. Many Gen-Xers and older millennials who bought their starter homes years ago are now ready to step through the door of a new home, one that better accommodates their current lifestyle.
Rather than paying hefty brokerage commissions like their parents did, these homeowners are looking for ways to retain more equity from their home sale.
They’re used to companies like Uber, which proved that the existing taxi model was overpriced and inefficient. They know technology can be leveraged to reduce cost, while improving service. Why can’t the same be true for real estate?
Many first-time homeowners don’t know the true cost of selling a home since the fees are typically paid for by the seller. In a typical real estate transaction, the seller pays 3% of the home’s selling price to the listing agent, and 3% to the buyer agent. To put this number in perspective: if a home sells for $500,000, that’s a whopping $30,000.
Homeowners have been right to ask whether this cost is truly reasonable when so much of the home sale process takes place online now. And the truth is: the real estate industry has stuck to this fee structure, despite the internet creating a more open and efficient marketplace.
According to the U.S. Department of Justice, the traditional real estate brokerage industry keeps prices up through a lack of competitive pricing.
“In other areas of the economy, the Internet has dramatically altered the competitive landscape by driving down costs and enabling innovative and more efficient ways of conducting business… The real estate brokerage industry has been slower to change, with the result that consumers are paying higher commissions and fees,” reads a recent report.
The technology already exists to improve efficiency, and many real estate brokerages are saving money– they’re just not passing these savings on to their clients.
One brokerage that is solving this problem is Houwzer, a top-rated real estate and mortgage brokerage that charges a flat fee of $5,000, plus 2.5% to the buyer’s agent, all paid at closing. Using the $500,000 home example, that’s a savings of $12,500 compared to a traditional brokerage – money sellers can put towards future upgrades or a down payment on their next home.
Houwzer is able to reduce costs without cutting back on quality by leveraging modern technology and hiring agents as full-time salaried employees who specialize in one side of the transaction.
"You need a quarterback – not a jack-of-all-trades,” says Mike Maher, Houwzer’s CEO & Co-Founder. “Houwzer sellers get a listing expert and a team of specialists who handle everything from operations and accounting to marketing and tech support, instead of one agent who is forced to run their own business.”
Online reviews paint a clear picture of how brokerages conduct their business, and Houwzer has maintained an incredible 4.9 out of 5 star rating with over 850 reviews on sites like Google, Facebook, and Zillow.
“After hearing about Houwzer on the radio we had to at least give them a shot. Full service agents for half the price couldn't be more true,” says past client David K. “From the beginning to the end, the Houwzer team was on top of everything. It's nice knowing that there is a team behind the agent you talk to and deal with on a daily basis. We sold our house in four days and above asking price.”
Houwzer’s approach works: their listings settle for $4,400 more than the industry average, and spend 55% fewer days on the market. So far, Houwzer has saved sellers over $18 million in commissions – and they’re only getting started.
By prioritizing a great customer experience and setting fair prices, Houwzer is proving that the old way of doing things isn’t necessarily the best way of doing things.
Homeowners can experience a one-stop shop for all their real estate needs. Houwzer’s mortgage advisors shop around to find homeowners the best rates and loan options available, while their title agents ensure the closing is safe and secure.
Houwzer sweetens the deal for homeowners who both buy and sell with them by offering a bundle rebate. When homeowners buy and sell with Houwzer, they enjoy a seamless experience and receive $2,500 of their $5,000 listing fee back at the closing table. This rebate, combined with the robust savings from the slashed listing cost, makes it easier for sellers who are trying to upgrade their home to present more compelling offers in a hot market.
Homeowners have gotten much savvier. They’re aware that it no longer costs 6% to sell a home, and they’re tired of overpaying on real estate costs. Houwzer is using modern technology and salaried agents to improve the existing model, allowing homeowners to save more when they sell.
By working with Houwzer, first-time home sellers are able to strengthen their financial footing and streamline what could be a stressful process, allowing them to focus on what really matters – their family and settling into their new lives.