Glad to see one of the most innovative thought leaders in e-commerce moving the “Groupon for Real Estate” conversation from industry insiders to the blogosphere, but note that Pat Kitano’s blog post is real estate agent-centric and may assume traditional players, traditional commissions, etc.
Whether the industry likes it or not, millions of consumers may regard the current two-sided real estate commission and widespread practice of dual agency (and it’s evil twin, designated agency) as “GroupCon.” Need I add that blind bidding wars are regarded as group manipulation and in some opinions helped inflate the real estate bubble? No group savings there; in fact, more like group or should I say national recession courtesy, at least in part, of the real estate industry?
So, while I am interested in seeing what kind of group buying models emerge in real estate and have written about the subject myself, my consumer-centric perspective is as follows:
If tech-savvy, do-it-yourself homebuyers and sellers understand the magnitude of savings possible by working with real estate innovators who are using new technology and new business models to reduce transaction costs and bring systemic changes to the real estate industry, they’ll understand that individual coupons are marginal, at best, compared to “systemic savings.” How large are those mega-savings? Up to $30 billion dollars annually, according to an estimate by McKinsey & Company way back in 1999. Some companies, like The Real Estate Cafe, have been delivering a menu of savings opportunities without coupons for years. Sixteen to be exact (see timeline).
Homebuyers, if you were smart enough not to fall for the homebuyer tax credits the last two years, we’d love to work with you (and dare I say this, we’ll offer you a “special incentive” to respond to this link?)
If you’re a real estate portal or an entrepreneur calculating the ROI on a group buying model for real estate, we’re open to collaborations. Contact us for an annotated copy of our critique of “Groupon for Real Estate.”