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A commission-free real estate company that attracted attention last year when it reported a 147 per cent increase in revenue is branching out into the world of flat-fee agents.
If you start to talk about flat-fee agencies, the first name on everyone’s lips is Purplebricks, the UK company that made waves in the property industry in 2016 when they announced a move to Australia.
However, there is a new player on the scene and its executive director says the comparisons with Purplebricks are unwarranted.
“We’re going to get comparisons between us and Purplebricks, but the two big differences are we don’t charge for open for inspections so our fee is less and part of our fee is only payable on success,” buyMyplace executive director Cameron Fisher said.
“Also, we’re an ASX-listed company, we’re not a UK company so there are certainly differences between us,” Mr Fisher added.
Since its launch, the agency has been offering a DIY sales model to owners who want to save money, but is now also providing a ‘full service’ package that includes a fully licensed agent working for a flat fee of $4,595, including GST.
The fee is split into two, with $2,995 payable on listing and the balance to be paid when a successful sale has been achieved.
“It gives vendors comfort that we’re out there working for them. We haven’t got our full fee unless we are successful [and] it gives vendors peace of mind,” Mr Fisher said.
“There’s a bit of a fallacy about agents and the desire to work harder because they’re on a commission. I’ve seen that agents won’t go that extra yard to make an extra $80 and risk commission they’re already getting. The fact that it’s tied to percentages doesn’t work. It’s more about having part of the fee at risk if the property doesn’t sell.”
Mr Fisher also said agent’s fees, which are tied to house prices and have increased 12-15 per cent in Sydney and Melbourne, are unsustainable.
“I don’t know any other business or profession that’s had a 12 or 15 per cent pay increase in the last year or a 50 per cent pay increase in the last five years like real estate agents have. It can’t be sustained and people are waking up to it. So we’re offering a full licensed agent service at a fee that is reflecting on the work involved, not on the value of the property,” he said.
Mr Fisher dismissed the argument that agents are worse off under a flat-fee model, saying the buyMyplace model offers stability and the chance to sell more properties.
“[Under the buyMyplace model,] agents have their own sole listing area. In a traditional agency, you can be competing against two, five or 20 other people within your office for listings. With us, there’s no competition that way. It’s your area, you’re the area specialist, you know that area backwards, it’s your area to work,” he said.
Mr Fisher added that the more flexible hours and absence of an office will give agents a better quality of life. He is also optimistic about attracting top agents to buyMyplace.
“I’d be one of the most qualified agents in Australia. I’ve run my own businesses, been partners with some of the biggest private real estate companies in Australia, done over 5,000 successful auctions. I’ve been fully involved in real estate the whole way through. So if they’ve got people of my calibre and I can bring more people of my calibre, it’ll be outstanding,” he said.
BuyMyplace is currently focused on the Melbourne and Victorian market, but plans to be across the entire Australian market by the end of 2017.
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