Farewell to the 6% Commission looks like a helpful
book for new real estate buyers and sellers.
Can you tell us a little about what the reader can expect?
I don’t see the book aimed at
new buyers and sellers but instead everyone. Most homeowners don’t fully
understand there’s the likelihood 2 agents will be involved with the sale of
their property. The one they hire which is the listing agent and the one who
represents the buyers. I believe the buyers agents deserve more than 50% of the
commission. I say this because just about any agent knows how to post a new
listing on the MLS which then gets electronically shared with 700
consumer-facing real estate websites like Zillow, Trulia, Redfin, etc. But, there’s
only 1 agent who delivers the buyer and therefore should be properly
compensated.
The Zillow’s, Trulia’s, Redfin’s
etc. have been educating homeowners and potential buyers of homes and condos
for 20 years. Because of this the knowledge gap between consumers and real
estate agents has been leveled. What consumers don’t know is how to keep a
transaction on a track that leads to a successful closing. Real estate agents who
represent sellers nowadays are far less mission critical than they were in the
past. My goal was and is to enlighten consumers so they know commissions can be
easily negotiated and that they would be wasting a lot of their precious hard-earned
equity if they choose to over-pay.
Can you tell us a little about your background and what
you do?
My background is in Internet
technologies. I started two venture capital backed technology companies. The
first one was Desktop Video Conferencing for PC’s over the Internet. I started
and sold the company long before Skype and others entered the market. The
second startup company was based on advanced speech recognition technology like
Apple’s Siri, Amazon’s Alexa, etc. I raised several million dollars from
strategic partners and venture capital firms. I hired 4 PhD’s in Computer
Science and Artificial Intelligence for the engineering department and a
Harvard MBA for the sales and marketing department. While we had what many told
us was the Dream Team of executive management the company failed when Apple
introduced the iPhone. As you probably know speech recognition technologies
have many issues to deal with such as ambient background noise if a person is
in a car, bus, airplane, TV or Radio playing, etc. With an iPhone consumers
could easily type their questions and not have to rely on voice recognition technologies.
I diversified my investment
portfolio company to include residential real estate in 2004. I obtained a real
estate license then for the purpose of lowering my transaction costs. At the
time I never imagined being a real estate agent who helps buyers and sellers
achieve their goals but that’s what ultimately happened.
What inspired you when writing Farewell to the 6%
Commission?
The inspiration came from the
overwhelming lack of knowledge consumers have about real estate commissions.
99% of people including real estate agents use words like 5% or 6% commission
for reasons homeowners don’t fully understand. In many cases the average
homeowner selling a home or condo agrees to pay a 5% or 6% commission is
actually paying 25-40% of their hard-earned equity. So, if an agent were to say
our fee to sell your house will cost you 25-40% of your total equity wouldn’t
it sound better if they say 5% or 6%. I see myself as more of a change agent
trying to educate sellers so they can keep more of their hard-earned equity.
When writing Farewell to the 6% Commission did
anything stand out as particularly challenging?
No, not really. We live in a day
and age of transparency. It’s important for homeowners and buyers of property
to fully understand everything. Because of my background I’m fine tuned to
understand business models in order to determine if they’re defendable against
competition, etc. The 5% or even 6% commission can no longer be defended. This
is because discount brokerage companies and agents nowadays offer the same full
service to their clients so why would anyone want to overpay?
What do you like to do when not writing?
I like helping homeowners to
sell their homes at top dollar that includes a discounted commission, full
service and without any drama. I also like to help buyers achieve their dream
of owning a condo or house knowing they paid a provenly fair price and still
receive a generous cash rebate equal to 33% of the what the seller paid me to
deliver a qualified buyer that closes on the transaction.
Where can readers find out more about your work?
They can go my website www.TheGeddesGroup.com or see my profile on Zillow https://www.zillow.com/profile/The-Geddes-Group/