A subscription based real estate model

[Jack Seiden]

I want to run by the biggerpockets world a potential new model I’m working on and I want to be clear this is not intended for self-promotional purposes or necessarily even something I will enact (i’m not even totally clear on the legally of this) but something I want feedback on and also to spark a discussion of alternative agent models. One thing I have realized as an agent is I have two main issues, 1. You spend a lot of time working with tire kickers and don’t get paid for it. 2. I personally have a very hard time to the pushy sales tactic at the end of the day it’s someone biggest financial purchase and not my money. Now I still try to help people and provide value but I’ve been effectively giving that away for free. Would you pay for a subscription model say $1000 a month where you got access to knowledgeable investor agent who had zero stake on if the transaction closed but provided you with local knowledge, strategies, ran comps, looked over deals, even looked over home inspection reports, talked in the phone, basically a consultant (you could possibly tack on services like writing offers or seeing a property in person) my thought is if you buy a property relatively quickly, it’s much cheaper than paying 2.5% even if you end up paying for the service for a few month’s and realize it’s not a good time for you to buy you are only out a few thousand dollars as opposed to hundreds of thousands of dollars, this would basically take the agent’s need to sell you a home out the process, presumably there motivation would be to keep you subscripted for as long as possible but you could easily just cancel and if you were interested in buying later resubscribe than. Interested in any thoughts feedback or other alternative ideas?

[Chris Seveney]

@Jack Seiden

Few questions:

1. Who would be your target audience? Reason I ask is most investors are cheap and those who are not like to underwrite their own deals. Also if they don’t like your deals they will leave you scathing reviews and most likely it’s because of their inexperience

2. Have you ran this by an attorney on your risk? Moment you start providing investment advice or a deal does not pan out and you were paid for that service what liability would you have?

Just some food for thought.

[Jack Seiden]

Quote from @Chris Seveney:

@Jack Seiden

Few questions:

1. Who would be your target audience? Reason I ask is most investors are cheap and those who are not like to underwrite their own deals. Also if they don’t like your deals they will leave you scathing reviews and most likely it’s because of their inexperience

2. Have you ran this by an attorney on your risk? Moment you start providing investment advice or a deal does not pan out and you were paid for that service what liability would you have?

Just some food for thought.

Thanks for the feedback! It’s possible I did a poor job of explaining this, this isn’t really a service for investors per se’ in fact I would probably in an ideal enjoy doing this more for primary home buyers, this to me is an alternative to the 2.5% commission model, you cut out the most time consuming and often in my opinion least valuable part of the job which is showing people around and opening cabinets and seeing if they are soft close or not lol (I presume in this new world there will be more open house, more showings by listing agents, possibly more services that allow buyers to show themselves houses like the Redfin does on some of its listing) because of that plus the guarantee of getting at least something for your time allows you to theoretically charge much less while still providing the important parts of the job, like you should consider this area, let’s go over this home inspection repost, here’s how we should craft an offer etc, even spending time explaining rent vs buy calculation and personal finance etc,

 plus the being able to be paid regardless of your advice, I’ve had countless clients who has just a myriad of bad ideas I’ve talked out of, but of course you don’t get paid for that in this commission structure. Now I suppose bad reviews is always a risk of working with people, you try to do a good job and hope people are satisfied, as for the 2nd thought yes this is something I absolutely need to do more legal research on and check with my brokerage, my thoughts were this would hopefully be covered by a standard buyers agreement, again if you take a 2.5% commission and the person hates thier house they can’t sue you, I would hope this would be the same.