Listen: Realogy Joins Forces with Amazon to Sweeten Real Estate Deals
"This episode of Business Wars daily is brought to you by sent pro online from pitney bowes shipping and mailing from your desk is never been simpler than with sent pro online from Pitney Bowes. Try It free for thirty days and get a free ten pound scale. When you visit http the DOT com slash B W daily <music> from one? I'm David Brown and this is business wars daily happy Monday friends a couple of weeks ago. My family moved to a new house is our dream home. We'd ided for a long time and when it came on the market we jumped. Jumped at the chance to buy it. We did our real estate transaction. The old fashioned way our agent worked with their Asian each of us paid our portion of the customary fees and we'll do it all over again when our old house cells to most of us on the outside of the residential real estate business. It probably looks like that industry hasn't changed in decades <hes> but we are wrong. Real estate brokerages are in turmoil up ended by what else the Internet there are new online ways to buy and sell houses in new ish ways for real estate agents to get valuable leads and that's affecting the ability for traditional realtors to make money which leads me to last week's news which caused a big stir in the real estate industry realty conglomerate that owns brokerages bridges like century twenty one coldwell banker in Sotheby's is launching a new partnership with Amazon called Turnkey through a turn key portal on Amazon. You'll search for a house in putting some specifics about your dream home. Amazon will then provide. Provide you with a choice of realty real estate agents in your area. If you use one of those agents to buy a house well Amazon promises to give you products and services worth up to five thousand dollars the program rolls out I in just fifteen real estate state markets and hardly everyone will qualify for the full five thousand dollars to get that you'd have to buy a house for seven hundred thousand dollars or more still what you'll get if you go for it Amazon home services like unpacking thing in painting and smart home products like the ring doorbell installed by Amazon of course realty will pay for the Amazon gifts from its commissions. Some analysts say the deal is a big win for realty which has been struggling its stock price jumped twenty five percent on the news but others see it as a desperate ploy real. G's market valuation is down to six hundred million dollars from a high of more than seven billion only six years ago according to The Wall Street Journal the Forces buffeting Real G. R.. Many the luxury housing market the company's primary targets slowed last year at the same time. It's brokerages are keeping a smaller percentage of agent commissions in case you don't know how that works. Brokerages have traditionally found leads for their agents and split commissions with them but more and more agents are finding their own leads through zillow meaning realty takes less of the commission so real. G. NEEDS A new way to provide leads to agents one that circumvents zillow so you might think that Zillow is real. G's biggest problem once again you'd be wrong. Realty has at least two other big problems. One is upstart online competitors called I. buyers like open door and knock which promised promised to buy or sell your house for you without an agent keeping commissions down but even more challenging to realty and two other big brokerages is a six year old Silicon Valley Company called compass. It's been luring veteran real estate agents away from competitors. Hitters by promising wapping commissions in some cases taking nothing themselves for the first several transactions now compass is funded by investors including Softbank and it's valued at more than four billion dollars a washing cash. It's been acquiring brokerages at a rapid rate furthermore. It's executives admitted recently that they haven't yet formulated a plan to actually turn a profit but compass does intend to go public that no profit but go public formula sounds a a lot like what was happening before the Internet bubble burst in the early two thousands remember but in the meantime compasses making misery for Realty Realty recently sued compass alleging the company stole company secrets and persuaded agents to violate violate non compete agreements among other things realty denies the claims what we know of the real estate industry may look entirely different within a year or two no. You won't be able to buy a house on Amazon at least not yet but. When Amazon enters the picture will you know things are changing and fast from wondering this is business awards daily? I'm David Brown happily ensconced in my new house still in Austin. Hey tell us a little something about you. Would you go to wondering dot Com. Slash survey answer a couple of quick questions. Thanks so much we'll see this episode is brought to you by central online from Pitney Bowes Shipping and mailing from your desk has never ever been simpler than with Sunpro online from Pitney bowes with simple online is just click sand and save for as low as four dollars ninety nine cents. That's right four dollars. Ninety nine cents a month. Send envelopes flats and packages."