From transportation to the media, Internet based companies have succeeded in disrupting operations in many fields. Now, a Texas based company hopes to bring a little disruption to the standard way of selling a home, News Radio 1200 WOAI reports.
Alex Daubet got the idea for Door.com when his mother sold his childhood home in Dallas using the traditional 'six percent commission to the Realtor' system.
"She sold it with a traditional real estate commission, which for her was over $50,000, which I just thought was a crazy amount of money," Daubet said.
So he began looking into the 'six percent commission' policy, and discovered that, not only could he not determine when it began or why, he realized it was totally outdated for today's real estate environment.
"Why am I paying a real estate agent more money to sell this house, when the reality is now 95% of people look on line to buy a house, and a majority of people, more than 50%, end up buying a house that they found on their own," he said. "So the amount of work the real estate agent does has gone down."
And he says with house values rising virtually everywhere in the country, it doesn't make any sense for a Realtor to make more money when selling a home just because inflation has pushed up the price of that home. He says Texas home values are rising an average of 9% a year, and that doesn't mean real estate agents are doing 9% more work.
So he founded Door.com to disrupt that industry.
His business model--his sales people sell your house for a flat $5,000 fee, regardless of the cost of the home.
He says the process of the sale remains familiar.
"If you're selling a home with Door, we stage your home, we do a 3D model, professional photographs, the yard sign, the lock box, you have an agent."
But what you don't have is somebody dipping into the sale price you receive for that home to the tune of $50,000 or more.
Daubet, who is CEO of Door.com, says the company is opening an office in San Antonio. He says just like traditional real estate agents, the Door sales person will help the seller through the closing, through the title search, and all of the other complicated parts of getting a home sold.
"The average agent in the U.S. sells 5 homes a year," he said. "Ours sell 70 homes per year. We use technology to make our agents more efficient, and what that results in is a much lower cost for our clients."
He says if you buy a home with Door.com, the sales person splits the three percent buyer's agent commission with the buyer.
He says technology has made it far easier for sellers to make their home known to buyers, and for buyers and sellers to get together, so the old model of the seller's agent receiving six percent of the sales price doesn't make sense.
"That is a very old fashioned business model," he said. "The U.S. and Canada are the only first-world companies that uses the six-percent commission business model. It doesn't make any sense, and all it does is rises costs to the customer."