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I wish a startup would decrease the transaction costs of buying real estate rather than increasing them.
by nostromo 10y ago
I wish a startup would decrease the transaction costs of buying real estate rather than increasing them.
- jdross 10y agoGive it some time. Useful to look into why Redfin never really took off. There's so much fat in real estate outside of the agent fee, too. Mortgage closing costs, title insurance, escrow fees... it's ripe for improvement full-stack.
- coredog64 10y agoThe fact that real estate agents haven't suffered from the same negative publicity as banks for their part in the housing bubble tells you everything you need to know about their political power.
- LordHumungous 10y agoI mean, the fat is like 6%
- jonstewart 10y agoI thought similarly, too, but if time is money, then they really might be reducing the transaction costs of the seller, by allowing the owner to sell _now_ and without worries about the buyer's financing coming through, etc.
- jdross 10y agoAlso the cost of moving twice. First into a short term rental so you can get the money for your next down payment from your current home, then moving into your new home.
- shostack 10y agoI thought banks offered bridge loans just for this sort of thing, no?
- jdross 10y agoDepends on your credit, it's not too common and they're also quite expensive. And if your sale falls through, you're pretty screwed
- shostack 10y agoInteresting. So Opendoor removes that risk for a premium on fees it seems. What is the path to reducing the fees overall? 6% seems a bit much in this day and age, particularly in the Bay Area where an agent sets up a few signs, posts the listing, does an open house for one weekend and that's it. And agents (both sides) are incentivized to close more deals, not get the best prices. Ultimately homeowners/buyers get screwed.
- mconnolly 10y agoSee @OpenListings. They're doing exactly that