ListedBy on a mission to shake things up
ListedBy is known in the real estate industry for their role as a free online marketplace and social network with live bidding auction functionality targeted towards real estate assets and real estate related professionals. But what some people don’t know is that while their business model is one focused on transparency and disruption, their auction tool is most poised to shake up the sector.
The real estate auction space is quite traditional, and dare we assert, it is mildly behind the times. ListedBy is doing their part, going head to head with hudhomestore, auction.com, bid4assets, realtybid, and others.
The company tells us they disrupt the real estate auction space in three key ways – cost, transparency, and 100% online.
ListedBy has a different pricing model
Because the site is free for buyers and sellers, rather relies on advertising, the company says it leads to more participation by Realtors and consumers, and more money in buyer pockets, as compared to 2-10 percent buyer premiums competitors require. Traditional auction sites charge anything from registration fees, listing fees, bidding fees, to the most common – a fee the buyer pays when they’ve won an auction.
Buyer’s penalty or buyer’s premium is what a buyer typically pays when they’ve won an auction, costing 2-10 percent, so a $200,000 property costs the buyer an additional $4,000 to $40,000. The company tells us they circumvent that, as these fees tend to hold buyers back, compromises the seller, and “Holds dollars away from being used to move the inventory. If the buyer knew they had that extra 4-40K to put towards the property, the chances of the asset getting sold increase significantly.”
Adding transparency to a legacy industry
In a statement to AGBeat, ListedBy said, “In an environment where a bidder does not know who is bidding, does not have visibility to all those bidding, where the bids are at or who won, there is virtually no way to know that the process is trustworthy and fair. Lack of visibility may also compromise the ultimate value of the property.”
They allow everyone to see who is bidding and how much, giving everyone an equal chance and optimizing the property market value.
Taking the process completely online
ListedBy takes the auction process completely online which they say is faster, less expensive, and more efficient. “An online avenue does away with the added effort, inconvenience, resources and expenses needed to organize and run a physical, on-location auction on site at the subject property.”
The company points out that in some cases, auctioneers hold online and offline auctions simultaneously on a property, which can lead to a disconnect and certainly falls short on transparency.
The takeway
The company is growing their offering, but the auction space is in dire need of innovation, so shifting the cost model, transparency, and putting it all online could put a dent in how the auction space operates.
