One more thought about the extinction of buyer-agents.

There are many variables that point to the demise of the two-agent system that has prevailed for 100+ years. The coming changes should roll out over the next 12 months too – how exciting!

What’s already happened:

  • Buyer-agents can no longer tell buyers that they work for free, when paid by the seller.
  • Buyer-agent commissions are advertised on the search portals.

What’s coming:

  • The DOJ/FTC directs realtors to ‘de-couple’ commissions, and buyers pay their agents, instead of sellers.
  • Buyers will think they won’t have to pay a commission by going direct to the listing agents.
  • CoStar develops and advertises the Broker Public Portal, whose stated goal is to advertise listings and send all buyer inquiries back to the listing agent, instead of a third-party.
  • Realtors will sell their listings directly to those inquiring buyers.

The traditional buyer-agents get cut out of the loop, which then also means the MLS isn’t needed either.  Then today’s search portals break down because they aren’t getting the listing feeds from the 600+ MLS companies around the country.

Because it is dual agency when buyers go direct to the listing agent, there will be a semblance of buyer representation, so commission rates won’t change much – even though buyers will mostly be on their own.  Whether the consumers recognize the benefits of having their own representation won’t matter.  They just want to buy a house, so the companies that spend the most money on advertising with win their business.

Any disrupter could win the game if they spend enough money. Zillow was spending more than $100 million per year in advertising to become #1, and it worked.

In the link below, Joe says that CoStar is going to spend a couple of hundred million dollars on consumer advertising to compete with Zillow. You can imagine their advertising:

Want to know about a property? Click here to contact the listing agent directly!

Joe lays it all out here, starting at the 17-minute mark:


Throw in an auction platform somewhere along the way, and homes sales will be transformed forever.

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