/ CBS Baltimore
The kids have left, the yard is difficult to maintain, and the empty-nesters are ready to move on. As baby boomers reach retirement age, many are selling their large family homes and downsizing to properties that better suit their lifestyles.
Baby boomers own a third of all homes across the country and know that hiring an experienced real estate agent for this next step is valuable: a competent agent simplifies the home selling process and accurately prices homes to get the highest offers. At the same time, boomers have come to realize that these services shouldn't cost 6% of their home's value.
Walking away from a home sale with the most money is an important part of smart financial planning. Real estate commissions are the greatest expense a home seller has. As a result, Houwzer has become the top real estate company of choice for thousands of baby boomers selling their homes and looking to save — here's why.
It doesn't cost 6% of a home's value to sell it anymore
Prior to the internet, buyers relied on for sale signs, newspaper ads, magazines, and agents to get access to Multiple Listing Services (MLSs) and find what homes were for sale. Today, consumers can pick up their smartphone and begin browsing listed homes on Zillow in a matter of seconds. In 2018, 96% of people who bought a home used the internet in their home search. With the internet creating a free and efficient marketplace, it simply doesn't cost 6% of a home's value to sell it anymore.
Many baby boomers have been through the home selling process before and question why they should be charged a 6% commission when the cost to advertise homes has dropped. In addition, marketing a $600,000 does not cost more than marketing a $300,000 home. Why pay an agent double for the same time and effort just because a home is worth more?
According to the U.S. Department of Justice, the traditional real estate brokerage industry keeps prices up through a lack of competitive pricing.
"In other areas of the economy, the Internet has dramatically altered the competitive landscape by driving down costs and enabling innovative and more efficient ways of conducting business… The real estate brokerage industry has been slower to change, with the result that consumers are paying higher commissions and fees," reads a recent report.
Fixing the outdated real estate brokerage model
Real estate is ready for a change: this is the premise Houwzer was built on. Houwzer is a modern real estate company that makes home selling more enjoyable and profitable for sellers. By employing tech-enabled, salaried agents rather than independent contractors they are able to bring fees back in line with actual costs — allowing sellers to walk away from the sale with more cash.
When working with a traditional agent, a seller will pay 6% — that comes out to $36,000 on a $600,000 home. This is a steep price when you consider that the average budget for a retired household is roughly $45,000 per year.
Instead, Houwzer opts to charge a fixed price of $5,000 for their listing services and 2.5% which goes to the buyer's agent. In the example listed above, sellers would save an incredible $16,000. Houwzer isn't cutting corners to achieve these low costs — they're simply offering a fair price for services, in comparison to the archaic fee structure maintained by traditional brokerages.
Houwzer listing agent Chris Johnson maintains that modern technology has been a game-changer in keeping costs reasonable. "It's a mobile marketplace today; buyers are now searching for homes right from their phone. We're leveraging this technology and just setting a fair price for what we currently do," says Johnson.
Baby boomers choose Houwzer's listing service when downsizing because it's simply a smart financial decision. Saving thousands of dollars in the home selling process helps aid their retirement goals, leaving more money for vacations, long-term care expenses, home updates, and more.
Sometimes you get more than you pay for
Of course, baby boomers aren't just looking for cheap service — there are plenty of limited service, discount brokers for that. What they really want is a better value. This is where Houwzer really connects with boomers: they offer the full package for a whole lot less.
Houwzer doesn't use a discount listing model. Home sellers work with a full-service listing agent who has in-depth knowledge of the market. The agent is there every step of the way — answering questions, running a comparative market analysis, identifying a competitive listing price and strategy, negotiating offers and terms of the deal, and guiding them through closing. Every seller also has a listing coordinator who handles all the details like scheduling, photoshoots, paperwork, and deadlines. They receive everything needed to sell a home, including a lockbox, sign, virtual tour, open houses and more.
Houwzer's approach works: their listings settle for $4,400 more than the industry average, and spend 55% fewer days on the market. So far, they've saved sellers roughly $14 million in commissions and have managed to maintain an incredible 4.9 out of 5 star rating with over 850 reviews on sites like Google, Facebook, and Zillow.
Houwzer's impressive reputation has led many home sellers to become home buyers with the company as well. Many baby boomers downsize and take advantage of the company's Buy & Sell Bundle, a seamless program that includes a $2,500 buyer rebate. Other boomers who aren't buying now gift the Bundle rebate to their children or relatives to put towards their home purchase.
For client Sharon Henahan, the switch from traditional real estate to Houwzer was effortless. "This was a great experience at a really great price," says Henahan. "We had the full professional treatment of great house photos, an open house, easy to use online app, quick responses by phone, text, and email."
It's thanks to these enthusiastic word-of-mouth recommendations that Houwzer has been able to grow steadily over the last several years, expanding from Greater Philadelphia to the D.C. and Baltimore metros, with additional markets on the horizon.
