According to the San Francisco Business Times, Zip Realty has announced that they will no longer provide rebates to buyers. The article states that this is one of several moves the company has made to reposition themselves as a full service brokerage with amazing technology v. a discount broker. The result? I think this will be better for consumers, especially buyers.
Ok, here's the disclaimer. What I am about to say is not about Zip Realty or its agents--it's about the difference of quality in the service that one might expect to get from their agent when using a full service agent v. an agent who rebates part of their comission. The math is simple. If a company or an agent is willing to rebate a portion of their rebate to each buyer, then they will need to do more business to make up that revenue, assuming that they wish their salary or income level to remain the same. And that increase in volume requres significantly more work--helping buyers identify properties, reading disclosure packages, providing current, relevent market information on recent sales and analyzing this so that buyers can make informed bidding decisions. Once they are in escrow, there is additional work--guiding buyers through their due diligence process--having inspections, relating the information learned during inspections to the information provided in the sellers disclosures, assisting them as they work with their lender to get the loan--overseeing all of the complex transactional details. Bottom line: any professional's time is limited. To get the best results, would you rather work with a professional who is dedicated to giving the appropriate time and attention to your real estate transaction? Or would you work with an agent who will give you less time because they must do a higher volume of transactions to make a living wage?
Now of course, there is huge variability in the skills and personalities of real estate agents. In San Francisco and Marin, there are many highly skilled real estate agents with a lot of experience in our local markets. And, there are many who are not. Be sure when you choose an agent, you find one who has the skills, capabilities and experience to make the process a smooth one for you and to serve your needs. And be sure you find an agent or a team who will provide focus, detailed and appropriate attention to you and your transaction. In many cases, this is an agent from a full service brokerage, who has been in the business and successful for many years who can help guide you through the purchase of an important and expensive asset.