Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (1) | Ignore Thread Prev | Next
Author: Har1en Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 34  
Subject: Another Competitor Date: 6/22/2007 12:49 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 1
This one's very small and local to my market:
http://www.alwaysonepercentrealty.com/index.htm

Not really serious competition, however, this is the way that I see things changing from now on. The days of 6% commissions are over, and the large brokerages are going to feel the pain.

I could liken this to the rise of the discount online stock brokerages, however, I believe those are dispirate cases for two reasons:

1) Discount brokerages brought convenient trading and accessability to people at lower economic levels and democratized the world of equity trading. The revolution continues...

However, almost no one who wants to buy a home would balk at the Realtor prices. Perhaps that is foolish, not Foolish. Still, I do not think that discount Realtors will create a new market. Instead, they will steal market share from the larger commercial houses with their greater overhead.

2) Some brokerages are free, or nearly free, and the purveyors of those services depend on other product sales, such as interest from margin accounts or bank products such as loans to make money on customers.

That will not happen in realty because this stuff is a one time event. There is no room in the model for cross-sell of alternative products. The only way they might do something like this is if they also sold mortgages. I'm guessing that might be a breach of fiduciary confidences and duties, though.

So with those considerations, this business of realty will have to settle on a fair price eventually, and those who can cut overhead the most and build brand best will come out on top. I think ZIPR has the upper hand here, and they're doing the right thing growing as fast as they can during the downturn. They may be a very long term play, but I'm content to wait.

Har1en
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (1) | Ignore Thread Prev | Next

Announcements

Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Dividend Growth Investing

Good Time for Dividend Champions?
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement