KEY POINTS:
More licensed real estate agents are slashing their fees.
On Saturday, the Business Herald highlighted the rise of discount house sale fees.
Russell Malcolm, of Kiwi Real at Orewa, is charging a flat-fee of $6900, only payable once a house sells.
Now, Jeff Brill, principal of Rental Homes on Auckland's North Shore, said he too was discounting his sales commission.
Next month, he will launch a flat-fee structure and charge just $5000 to sell a house, regardless of asking price.
He is motivated partly by the downturn in the volume of sales but also by the rise of website Trade Me which he said was a big challenge to traditional real estate agencies.
The downturn and the website were having a huge effect on real estate agents, he said, and he predicts many more agents will be negotiable on their sales commissions.
Brill has worked in the real estate sector for 12 years and says he's seen a lot of people making a lot of money.
Rental Homes, a licensed real estate agency, is paying agents on a commission basis, compared to salaried staff at The Joneses, the four-agency chain which went into liquidation this month. Rental Homes had a large property management division, one of the reasons it was able to offer the low fees, Brill said.
Christchurch licensed agency Diane Astle Realty is selling houses for 1 per cent of their value, plus marketing and GST. The Ferrymead agency offers a commission fees calculator, challenging vendors to compare prices.
The Joneses was charging $7995 to sell a house, regardless of its value.
Go Gecko has a tiered commission, saying it can sell a house for just $5950. Green Door and Home Sell are also challenging the traditional model with varying fees structured much lower than many of the larger firms.
But not everyone likes the idea of lower fees.
Mike McColl, sales and marketing at LJ Hooker in Ponsonby, challenged the notion that mainstream agents were cutting their commissions.
Kiwi Real was not mainstream because it was not part of larger businesses like LJ Hooker, he said. Sales fees had always been negotiable, depending on the type of property and circumstances, McColl said.
Peter Thompson, executive director of Barfoot & Thompson, also challenged the discount method of selling real estate, saying people got what they paid for. Fees at the firm were lower than many others. "People don't mind paying a commission if they get good service," he said.