Innovation does exist in the real estate industry

by Alistair Helm in

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When it comes to selling your house you may think there are only two options. Employ a licensed real estate agent or sell it yourself.

The comparison assessed purely on a financial basis for a typical NZ homes would leave you to spend upwards of $17,000 in commission payments with your local agent or to spend somewhere around $1,000 doing it yourself; to which you would have to undertake the facilitation and negotiation for the sale.

The reality though is there is another option. A licensed real estate company that does not charge based on a percentage commission but simply charges a fixed service fee for providing a full real estate service; a company that has innovated so that their full service is undertaken by fully qualified and experienced agents, all undertaken remotely.

Now you may say that you want to meet your licensed agent and shake them warmly by the hand, but pause a moment. After that initial meeting do you think the work of the agent in following up enquiries and keeping you updated will be done though numerous face-to-face meetings, or via phone and email?

The reality is that in today’s world so much of the work of real estate agents is done remotely; so why not have an agent undertake the whole process remotely in the first place and in so doing use their time so much more efficiently and charge a fixed fee of $4,500 (plus GST) regardless of whether your house is in Ashburton, Nelson or Auckland, whether it is worth $250,000 or $2.5m.

Sounds a good concept? – it is. The fact is this week that company offering this full-service professional real estate solution just sold their 100th house.

Welcome to 200Square

Over the past couple of years as they have been testing and refining their business they have saved sellers over $1m in commission fees. They have made 100 property owners very happy with a great result selling their homes, such  that those people have gone on to tell others of their experience and that referral engine is now driving considerable sales for 200Square. No need for them to stuff flyers into your letter box – they live and operate online and deliver their service remotely. Happy customers who rightly say, why do I need to pay these agents thousands of dollars when this new professional service can do it for $4,500.

As their service is online; as the seller you can see the up-to-date status of the selling process through a smart personalised dashboard which clearly shows you what the agent selling your house is doing, how many buyers are interested and what is the overall level of viewing of your property online. As the process progresses the documentation and facilitation is again all managed online - as they say in their service offering "We don't play Taxi Driver or Courier"

Adding to their innovative approach to marketing they recently worked with GrabOne to create a deal to help homeowners – a $49 deal gave home sellers a $1,000 reduction in the cost of the 200Square service and according to feedback from GrabOne the offer exceeded the expectation of both parties. The offer page on the GrabOne site says that 40 of these deals were bought which reflective of how many people are looking to sell during that period is a very strong result. The offer also provide a great opportunity for Grant Wakelin (CEO of 200Square) to answer some really interesting and relevant questions about the 200Square service. In my opinion the promotion speak more to the logical association of an innovative online real estate company and an innovative online group buying service, than the sheer savings alone.

It was one of those GrabOne voucher buyers that lead to the 100th seller for 200Square with a property sale in Karori, sold unconditionally 16 days after listing.

So whilst you may think there has been little in the way of innovation in the real estate industry over the past decade as the tidal wave of the digital revolution has transformed so many industries, there are pockets of innovation seeking to deliver great service at a fair price.