👋Hello from the home office. Warning: This is quite long:)
I spent a lot of time this week thinking about Zillow ($Z) and the future of real estate. I will update this post as time goes on and as more information comes in.
And no, I don’t think all real-estate agents will go away. I just think there will be less of them. And the way they are compensated will change or be less than current state (6%).
MUST READ: CNN penned a good article about why a current class-action lawsuit could do away with the 6% real estate commission. It’s really long, but lays out why major changes in the real estate industry could be forthcoming. And what the affect on agents, brokers, and consumers could be.
In the article, they asked Rob Hahn what would happen to the industry if the lawsuit is successful👇
“It kills the industry,” said Rob Hahn, a real estate marketing consultant with the firm 7DS Associates, who predicts the number of people in the profession would drop to just 200,000 if the lawsuit is successful. “A lot of things that we as consumers value go away.”
Some context: There are an estimated 1.36 million real estate agents. A drop to 200,000 would be jarring.
Resources used in this article:
Important: Just because we’re bullish on the long-term potential of a business, doesn’t mean we’re bullish on their stock. Good companies can make bad investments if the price paid is too high:)