- A $418 million legal settlement in March upended the residential real estate market.
- Self-representation is set to become more popular, with agent-free transactions.
- Startup Hiizzy is trying to capitalize on this shift by offering an online marketplace for buyers and sellers.
In March, a $418 million legal settlement changed the real-estate market forever. Fat agent commissions are out. Representing yourself is in.
If you want to fire your real-estate agent, the startup world is already working to help you.
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 simple the process could be, and how much cheaper, 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, they 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 small flat fee in the future.
- There's access to recent local property sale price 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 24/7.
In the US, commissions on home transitions have hovered between 5% and 6% of the sale price for decades. In the UK, real estate agents charge a 1% to 3% of the property 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 ($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 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 would exceed £20,000.
Traditional estate agents mostly handle these tasks: They value the property; they photograph it; then create the listing and the advertising. They also communicate with buyers and handle viewings and price negotiations.
This can all be done online now without agents.
Albert Fox Cahn, founder of the Surveillance Technology Oversight Project, recently bought a property himself, 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 your answer yes to all three, you're in fantastic shape to be your own agent," he wrote in a recent Business Insider essay.
