Is the internet helping to keep real estate agents honest?
For homeowners looking for a real estate agent to sell (or rent) their property, it’s traditionally been about visibility. The agent with the most signboards, ads in the local paper, the greatest street presence, so to speak, always got the most listings. But just as it did for other business models, the internet is disrupting the real estate industry’s decades-long way of doing business.
Lead generation and comparison websites, like OpenAgent and Local Agent Finder, promise to deliver leads to agents, while also promising to cut through agent spin to help homeowners to find the agent who is truly best suited to sell their property. They promise all that, and to retain their neutrality in the process, even though they don’t charge homeowners a fee for their service.
How lead generation sites work
OpenAgent is the darling of real estate lead generation sites. It’s raised $12 million in venture capital since it launched in 2013. In the last 12 months, it’s also doubled in size, and in that time, matched more than 10,000 homeowners to sales agents; in the next 12 months it hopes to double its revenue. The way OpenAgent operates is pretty simple, and not much different to other sites of its kind. OpenAgent collects information about real estate agents and their sales records by scraping it from other sources, such as Domain and realestate.com.au, while also encouraging homeowners to write reviews about their experiences with a particular agent on their site, which it vets before publishing online.
Agents don’t get to submit their profiles to OpenAgent, nor is their inclusion on the site optional. If they’re a licensed real estate agent, with listings on a property portal, such as realestate.com.au or Domain, they’re automatically listed on the OpenAgent website. When a homeowner registers their details with OpenAgent, they’re able to peruse the recent listings, sales and reviews of all the agents in their area. OpenAgent then follows up by calling each homeowner to get a clearer picture of their property and the kind of agent they’re looking for. Following this, OpenAgent then provides the homeowner with a shortlist of agents to choose from.
OpenAgent doesn’t disclose a homeowner’s details to an agent unless they’re instructed to do so, at which point they contact with the agent on the homeowner’s behalf. If OpenAgent does introduce a homeowner to a real estate, who is ultimately appointed to sell the property, they’ll stay in touch with the owner throughout the process, to ensure the agent is being held accountable; they’ll even help the owner negotiate a better rate of commission. Once the property is sold, OpenAgent then takes a 20 percent fee from the agent’s agreed commission.
What this means for agents and homeowners
Success as a real estate agent today, in an era of lead generation and comparison websites, requires honesty and transparency. Agents can no longer cloak the sales process in mystery or exaggerate their sales history, because, whether a homeowner does their own independent research or uses a comparison site like OpenAgent to do the legwork for them, they’ll find out which agents are truthful and reputable, and which ones aren’t.
With so much information freely available on the internet, whether it’s about an individual agent and their track record or about the local market itself, homeowners now spend less time researching an agent’s credentials and more time weighing up whether they like and trust prospective agents. One of the first things a homeowner will do, once they’ve received a shortlist from OpenAgent or even a recommendation from a friend or relative, is look them up online.
Agents with an extensive web presence, and who are able to show people that they understand the market, that they’re open and honest about their previous track record, and that they’re friendly and approachable are more likely to win a new listing, than those agent who still operate under the old model of smoke and mirrors.
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