Bill Wendel leads the way

You know I read that post and "eestee"'s response in which the poster references "real estate cafe" and never new that it was an actual company. The way it was written in quotes and all lower case I assumed the poster was talking about theoretical pricing of services. However I am very intrigued by Bill's response both for his company and the ideas he would like the Obama Administration to tackle.
Intrigued
So while I don't think his company was maligned in any way I am happy to see his response and will investigate his business and offerings now that I know they are available.

Your statement that "The fee-for-service model is perfect for a consumer who is self-motivated and interested in doing a lot of his/her own footwork and research" is spot-on -- that is exactly our sweet spot, as is a growing segment of consumers who are uncomfortable with certain aspects of the commission model (such as the potential for conflicts of interest).

You are right that many consumers fear paying hourly -- but more and more of them are doing the math and making individual risk/reward calculations that lean towards choosing a fee-for-service model. In a world where the information advantage of the broker over the consumer has eroded significantly, many consumers just want to pay a broker to help them through the transaction -- and pay the same way they would pay a lawyer -- by the hour, even on a non-contingent basis.

You put it perfectly -- the fee-for-service model is just one option that consumers should have -- and each consumer can make the choice right for him or her. The commission model will always be a choice for many consumers, but the fee-for-service option should be there for others. Bill Wendel is definitely a pioneer in this area, to the great benefit of Boston area consumers. Thanks for your post!

Hmmm. I'm selling mostly foreclosures now, usually for a price around 200,000, sometimes less. The buyer's commission is usually 2 to 3 percent. My company--a full-service reality--get 45 percent of my commission. So: 2.5 percent on 200,000 is 5,000. My company gets 2,250, leaving me 2,750. I was trying to figure out the average amount of time I spent on a typical buyer. I usually take buyers out at least four or five times (often many more times) and show three or four houses each time. Figure the time to help find the listings, make the appointments, plan the route, print out the listing sheets, and drive and show the houses it's close to an hour per showing, so maybe I show 20 houses--that’s 20 hours of work.

Now add in the time spent when a house goes under agreement. I fax the offer in, negotiate the price, go to the inspection with my buyer (usually 4 hours right there), usually help deliver Purchase and Sale and check to seller’s attorney, and then attend the closing, to make sure it actually closes. I would guess a smooth transaction would be six or seven hours more--foreclosures usually are more, maybe ten hours.

Adding it up, I get close to 30 hours, which at 100 dollars an hour would be 3,000--I would do better with the real estate cafe, especially considering that a number of buyers I take out don’t ever get to closing on a house. Lately it’s been mortgage problems.

If the market picks up, and higher-priced houses are selling, I’ll do better. But for now, I can’t image my buyers agreeing to pay me 100 an hour, whether they actually buy or not. It is an interesting idea. It would be nice to have a steady income stream. Now, I’m working thirty to forty hours a week and not even close to making a living selling real estate. Not complaining: just stating a fact.

I have known Bill Wendel for several years and am impressed by his integrity and conern for consumer rights. He is particularly active in the campaign to do away with dual representation in real estate transactions, which the NAR lobby foisted on an unsuspecting public through its minions in state and federal government. I myself was vicitmized in 2005 by a so-called presumer buyer's agent working Weichert Realty of Maryland who abruptly switched roles to become a seller' agent without my informed consent--and even without the knowledge of the seller! I can therefore testify personally to the deceptiveness and potential harm caused by dual agency and applaud Mr. Wendel's efforts to abolish it.

Umm Mary if your company is getting almost half (45%) of your commission then maybe something needs to change with the way your company (and others?) take a bite out of the commission you make. Just a thought if things are shifting then why shouldn't the way you and your company split commissions shift as well?

Hi Curious,

I see your point. The higher the dollar amount I sell, the higher percentage I can keep, but in this market it's very hard to sell the high priced homes that would put me in that category. And, as a matter of fact, my brokerage company is also in the red. We're all trying to survive until the market picks up. Again: not complaining, just stating a fact.

I have an issue with a franchised realtor, and a conveyancing lawyer, who is (indirectly) the owner of the franchised agency.
Where can I ask some questions on this issue?