In March, a $418 million legal settlement changed the real-estate market forever. Fat agent commissions are out. Representing yourself is in.
One new offering is from Hiizzy, which is building an online marketplace where home buyers and sellers come together to complete transactions themselves.
The startup got going earlier this year. It’s the brainchild of Lewis Buckley and Allan Wood who met during a private home-sale process that — you guessed it — involved no real-estate agents.
Having seen how much simpler and cheaper the process could be, they wondered why more people don’t buy and sell their homes this way. That’s when they started building Hiizzy together.
Hiizzy works like this for home sellers:
- On Hiizzy.com, sellers can create a property listing with uploaded photos and a website URL for sharing. This is free for now, but the startup plans to charge a fee in the future.
- There’s access to recent local property-sale data to help sellers set a realistic asking price.
- It comes with an AI writing tool so sellers can easily generate a compelling property description.
- The service lets sellers communicate directly and securely with buyers.
- It offers a tool to book viewing requests and respond to offers.
In the US, the National Association of Realtors accepted a $418 million settlement to bring to an end a series of class-action lawsuits over agent commissions, which have hovered between 5% and 6% of the home-sale price for decades. In the UK, real-estate agents charge 1% to 3% of the home-sale price, and then sellers usually have to hire someone else to handle the legal stuff.
Hiizzy is starting in the UK, where it plans to introduce a £395, or $496, flat listing fee for home sellers in the future. At the moment, listings are free, but even with the full fee, selling a home on Hiizzy.com without an agent could be way cheaper.
Take a £500,000 property as an example. Even with the lowest 1% commission rate of a traditional real-estate agent, a homeowner would save £4,605 if they paid Hiizzy’s £395 flat fee. For a £750,000 home and a 3% commission, the savings could exceed £20,000.
Traditional real-estate agents mostly handle setting a price for the property, photographing it, creating a listing, and advertising it. They also communicate with buyers and handle viewings and price negotiations.
Now, all of this can be done online without agents.
Albert Fox Cahn, the founder of the Surveillance Technology Oversight Project, recently bought a property this way, saving $50,000. He has a simple formula for those thinking of taking the jump.
“Do you have an internet connection? Do you have at least a seventh-grade reading level? Do you like saving money? If you answer yes to all three, you’re in fantastic shape to be your own agent,” he wrote in a recent Business Insider article.