Oakbank / Mount Barker - RLA 173455 Blog

The real estate industry is quickly turning against so called “free” agent recommendation websites, describing these services as “misleading” In recent years two main players have emerged in this space; those being  LocalAgentFinder (previously known as ‘sellmycastle’) and OpenAgent..

These two businesses have very different models to choose the most suitable agent for consumers, but they both aim to take a clip of agent commission pool by effectively selling potential home sellers details to Agents that are affiliated.

 “[These sites] are contingent on the agents who choose to participate and pay a portion of theior selling fee for a ‘lead’ and the very good agents don’t necessarily need to be engaged with these sites – simply, they don’t need them’.

Therefore – lies the question – are (sellers) really getting the best Agent for them from these referral sites all promising to take the task of finding a good agent off consumers’ hands.

Despite marketing themselves as a free and independent service, the agent profiles on LocalAgentFinder are made up of information given by agents themselves, and the site does not provide any assurance about their accuracy – so A dodgey agent could tell a porky and the consumer would be none the wiser...

How are the agents chosen?

“Call requests” – opportunities for agents to get on the phone with a potential seller – are not provided based on an agent’s sales performance but rather, their “history of replying to opportunities, and listing properties with registered LocalAgentFinder homeowners”. 

The more an agent uses the site, the more business it will deliver them.

For both models the agent typically has to agree to pay a referral fee to be paired with a home seller.

LocalAgentFinder charges 0.375 per cent of the sale price plus GST. OpenAgent takes 20 per cent of the agent’s commission.

Earlier in 2016, REINSW chief executive Tim McKibbin wrote a submission to the Australian Consumer Law review calling for new legislation to cover these websites.

As these sites predominantly only give leads to agents willing to pay, “the consumer doesn’t receive a service whatsoever”, Mr McKibbin said. 

If these Agent referral sites really gain traction, be prepared that consumers (sellers) will start to pay more as Agents will simply increase their commission structure in order to account for the extra monies going to Agent referral sites…