"The industry has long been ripe for revolution,” says UnRealty CEO Anthony Deonarain. “Agent commission fees are the highest in history, and they haven't changed in the past 30 years, despite real estate prices tripling or quadrupling during that time."
That revolution, likely to rile Realtors, is based on the increasingly successful model of other online realties such as TheRedPin.com, which appeal to the growing number of sellers and buyers looking for a way around the traditional commission structure.
The move is also supported by ongoing legal wrangling that further opened MLS system.
In UnRealty’s case, it’s using rebates and cash-backs as bait.
For buyers, UnRealty reduces commissions earned by their own buyer agents from sellers by 50 per cent, in turn giving that money to the buyer in the form of a cash-back.
Sellers are, in fact, being charged a fixed fee, “irrespective of their home's value,” according to Deonarain.
He’s also touting the realty’s Buyer Representation Agreement (BRA) that “does not contain certain commission clauses that other brokerages use on the Ontario Real Estate Association's (OREA) standard forms.”
According to Deonarain, that OREA BRA forces buyers to pay any deficiency in commission that the brokerage receives, meaning “the entire commission if no commission is collected.”
Still, traditional real estate agents across Canada are showing increased flexibility in their own pricing structures as the market continues to cool and pressure from online players builds.
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