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Redfin, CondoDomain allegedly blackballed by Boston broker



After all of these years, there is still a war rumbling in neighborhoods across America as traditional brokers are still obsessing over the merits of the rebate brokerage model despite most remaining full service and despite rebaters being embraced by consumers.

Rebate brokerages are still challenged by real estate insiders as highlighted by a recent event in Boston wherein rebate brokers Redfin and CondoDomain (both in the top 10 brokerages in volume and unit sales) were allegedly blackballed by a traditional broker and preemptively offered a lower commission because the broker allegedly has a “personal problem” with the rebate model.

According to CondoDomain, a Boston broker contacted Redfin and CondoDomain to notify them that on his listing, if either company desires to show the property, only 1% commission would be offered rather than the 2.5% offered via the MLS “because that listing broker doesn’t believe in our business model and he “personally has a problem” with the fact that we [CondoDomain] give some of our commission back to our client.”

In an email to CondoDomain, the Boston broker allegedly said, “Now, I haven’t actually done any deals with Condo Domain. So I cannot speak to the issue of whether your agents provide a level of service to your buyer clients which (sic) should entitle you to the full buyer broker commission. But you do give portions of the commission received back to your buyers, and I personally have a problem with that.”

Further, the broker allegedly wrote, “I have recently notified Redfin by written correspondence that any future compensation to their company or their brokers & agents on transactions with properties listed by my company will be at the sole discretion of Metropolitan Boston Real Estate and its seller clients, notwithstanding the MLS published cooperating broker compensation to buyer agents. Likewise, any company operating with a similar model to that of Redfin should not necessarily expect to be paid the commission being offered in MLS to cooperating buyer agents on any Metropolitan Boston Real Estate listings… Our company will advise our clients not to offer Buyer Broker level compensation to any brokerage offering to refund portions of real estate commissions received back to buyers – which is to say, we will seek our seller clients’ permission to make compensation to such brokers at our discretion.”

At the time of publication, we have not been able to independently verify, but CondoDomain claims the person who contacted them is a licensed Massachusetts real estate licensing course instructor (name withheld).

The rules under which this would be okay

CondoDomain asked their local board and MLS for a ruling on the behavior to which they advised CondoDomain seek counsel, noting the rules (as with most boards) is that the listing broker must honor the amount of commission offered through the MLS unless the brokers mutually agree otherwise or the listing broker is “excused through an arbitration hearing or other legal process.”

CondoDomain opines that this action is also a breach of the National Association of Realtors’ Code of Ethics, namely Article 15 which states “Realtors shall not knowingly or recklessly make false or misleading statements about competitors, their businesses, or their business practices.” CondoDomain’s assertion is that they are a full service brokerage and Metropolitan Boston Real Estate’s actions and alleged statements to their clientele imply otherwise.

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  1. Joe Manausa, MBA

    March 2, 2011 at 12:39 pm

    Lani, nicely done. This is so true of all dying industries/business models. The old boy network flexes its muscles for as long as they can. They can get away with “only 1% commission would be offered rather than the 2.5% offered via the MLS” until momentum shifts in the other direction. This too shall pass.

  2. Jim Duncan

    March 2, 2011 at 1:03 pm

    I feel like a broken record, but wouldn’t divorcing the commissions solve this problem?

  3. Bruce Lemieux

    March 2, 2011 at 3:38 pm

    This behavior baffles me. If you are representing a seller, why would you take any action that would reduce the exposure of your client’s homes to other brokers? When did it become the listing broker’s responsibility to interfere with the buyer’s relationship with his broker?

    I understand why an ‘old school’ brokerage would be threatened by new models, but selectively reducing buyer commission is not the smartest way to go. It’s not good for their sellers, and its not good for their brand. This strategy simply isn’t good business.

    Also, in my experience, buyer agents who rebate their commission are not the best negotiators. As a rule, they do not manage inspections and contingencies with the same detail as ‘regular’ buyer agents. They seem motivated to “just get to closing”. Ultimately, my sellers do better with rebate-brokers. Why would I discourage these agents from my listings?

  4. T. Longo

    March 2, 2011 at 3:46 pm

    Hey Lani – glad you picked up the story. Enough is enough with the negativity in the market among our peers. This industry is all about the client (buyer or seller or renter for that matter) and anyone who doesn’t get that needs to just move on.

  5. Dan Connolly

    March 2, 2011 at 4:34 pm

    A lot of brokers around here advertise in the private remarks that the Buyer’s Broker’s commission will be 1% if the listing agent shows the property to the buyer. It doesn’t address the individual discount brokers but it solves the problem.

    • Jane Wallace

      March 3, 2011 at 5:15 pm

      Dan, What a Great Idea, I am going to use that from now on

  6. Judy Graff

    March 2, 2011 at 8:03 pm

    Nice story, Lani. Here in Southern CA, the only brokerage that’s growing is Redfin.

  7. Fred Romano

    April 10, 2011 at 10:19 am

    If I received such a letter from a broker I would contact the local association and file an ethics complaint. It’s completely wrong that they offer a commission through the MLS but exclude certain companies from collecting the total amount. Its discrimination at it’s best.

    I don’t understand why brokers get so upset that some brokers offer a rebate back to the buyer… Why should they care? They can do the same thing if they desire.

  8. mike hardiman

    April 17, 2011 at 9:49 pm

    Disagree with the sourcing on this article – "Further, the broker allegedly wrote" and etc. is lame. Either the reporter was provided with a copy of the email – or she wasn't – and if not, then this "alleged" email should not have been reproduced nearly in its entirety. I don't have a problem with discounting, just the way this is presented.

  9. Lani Rosales

    April 18, 2011 at 9:50 am

    Mike, as indicated in the story above (and linked to), the source is the document published in full on the CondoDomain website:

    Thank you for reading.

  10. Robert Waring

    August 4, 2011 at 9:48 am

    Hey Lani,

    Just ran across AG, thanks for the story, sorry this comment comes so late. I wonder how well "seek our seller clients’ permission to make compensation to such brokers at our discretion" will go over with those clients if properly explained? If our criteria for a selling agent/broker remains "to bring a ready, willing, and able buyer" why should we care what business model is representing the buyer? My only concern is that with some discount/rebate models, the agent bringing the buyer doesn't perform those duties commonly expected of an agent on the buyer's side, leaving some of their "duties" to the listing agent. Unfortunately, this can lead to a conflict in the listing agent's proper representation of their seller client and creates an onerous disclosure situation for the listing firm. In Virginia, one reaction to this was a 2 tier commission structure that paid less commission to the selling agent and more to the listing agent when the listing agent had to provide additional service to cover what the selling agent didn't do; the expectations were outlined in the listing itself. It went beyond Dan's idea about 1% if the listing agent had to show the property; to receive full commission the selling agent had to show the home, write the contract, and be present for all inspections as well as settlement. Eventually the state stepped in with "limited service" disclosures and the problem took care of itself. In the situation you have outlined in this story, my opinion is that this broker is shooting himself in the foot; our job is to get our client's home sold and this broker is hedging that against a dislike for another company's model. That is just not good business practice; I'm curious as to whether or not it is a Realtor firm?

    Rob Waring

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Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?



Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

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Housing News

Average age of houses on the rise, so is it now better or worse to buy new?

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.



aging housing inventory

aging housing inventory

The average home age is higher than ever

(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.

With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.

Prices of new homes on the rise

Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.

Click here to continue reading this story…

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Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?

The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.



zillow move

zillow move

Why Realtors are vulnerable to these rapid changes

(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub,, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.

Note: We’ll let you decide which company plays which role in the image above.

So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.

1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

…Click here to continue reading this story…

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