TheRedPin.com

March 03, 2015 12:30 ET

Vancouver Consumers Set to Save Billions in Fees

Bold Brokerage Redefines Real Estate Commissions

TORONTO, ONTARIO--(Marketwired - March 3, 2015) - During the past decade, most Canadian homeowners have experienced huge gains in their property values. But the numbers suggest that it may be the Realtors® who are really coming out on top. Canadian homeowners who sold one home and bought another in the past ten years have paid a staggering $49.7 billion* in Realtor® commissions. In the Vancouver alone, sellers have paid $6.7 billion!

TheRedPin.com, a Toronto real estate brokerage, is set to fix what they call a centuries old business model with the introduction of TheRedPin One, a new program that significantly challenges industry norms by shifting 50% of their sales commissions back to consumers.

How it works: TheRedPin One cuts out the seller's portion of the listing commission for clients who engage TheRedPin.com to both sell and buy a home under contract.

Full program details available at TheRedPinOne.com

On a typical sale, the industry standard is for the seller to pay a 5% commission on the total sale price of the home. That commission is then split between the listing agent and the agent that brings the buyer. Thus, if a home sells for $1 million, the commission on the home would be $50,000, or $25,000 to each agent. With TheRedPin One, if a seller lists their home with TheRedPin.com, and simultaneously engages them to buy a new home TheRedPin.com will rebate its half of the listing commission, upon successful closing of the new home.

"This isn't going to make us popular with our colleagues, but our accountability is to our clients, not the industry," said Tarik Gidamy, Co-founder and Broker of Record for TheRedPin, Brokerage. "Based on rising property prices, Vancouver realtors® have essentially seen their incomes increase by an average of 4.2%** over the past three years. In contrast, our survey shows that the majority of Canadians are adjusting to years-long wage freezes. It just doesn't add up. "

A recent Google Survey commissioned by the company found that the majority respondents (56%) have not received a cost-of-living allowance in at least three years.

Additional findings of the Survey:

  • 80.3% believe Realtors® would work harder if their compensation was based on client satisfaction.
  • 68.7% of home sellers polled believe that it's easier or the same amount of effort to sell a home today than it was 10 years ago.

"The Canadian real estate system as a whole has its pain points, and one of our main reasons for building TheRedPin.com was to address them and put the consumer first," added Gidamy. "Our ultimate goal was to combine the best of technology and savings for consumers without compromising on customer service and expertise."
TheRedPin.com and the TheRedPin One program will be expanding to Vancouver, as well as Calgary, Edmonton and Ottawa throughout 2015.

* Based on 60% of all commissions paid in Canada from 2004 to 2014. (The 60% is an approximation of the percentage of sellers who go on to purchase a new home.)

** Based on commissions from rising property values

About TheRedPin:

TheRedPin connects people, data and technology. Our platform carries the largest database of active residential listings in the Greater Toronto Area, with plans to expand nationally. We are a challenger brand, with a unique business model that streamlines the real estate journey, and provides exceptional end-to-end services and benefits, not found at other traditional brokerages.

Founded in 2010, four friends recognized that the real estate industry might be the only sector not influenced by technology. The four saw this as an opportunity to reinvent the way people bought and sold properties, more specifically the way homes were searched. Today, TheRedPin is much more than that.

We are a tech startup that doesn't answer to the industry, we answer to our clients and ourselves

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