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Scary news for all real estate agents: you may soon be obsolete.
In hopes of disrupting the home-buying process, Open Listings has created a new way to streamline the ordeal and save some cash.
When co-founder Judd Schoenholtz was relocated to LA through his Brooklyn-based design agency, he and fellow founder Alex Farrill were introduced to the outdated system of real estate. With backgrounds in the tech industry, they failed to find any companies or tools that they identified with or found convenient. They were forced to go the old-fashioned route and found a local realtor.
But when buying his second property, Schoenholtz decided to take a crack at the process alone only to realize that anyone had the capability to handle the transaction, but very few people had the time.
“As everything has moved towards things like TurboTax for your taxes or Beepi for buying your car, there was no one attacking that problem for real estate,” Schoenholtz said. “It’s the most expensive and rare purchase, but we felt like it could be done.”
Thus, Open Listings was created. The website allows you to look around the market, work with a team of experts, and avoid the berserk agent commission by implementing a $5,000 flat fee.
A typical commission on a home sale is around 2.5 percent, which means that for a $1 million house, the buyer would be saving $20,000. Shoenholtz says the average savings is currently in that $20,000 range.
The company launched in February after an undisclosed seed round from various angels and VCs. They currently absorb all the cost of showing and inspections, but plan on implementing a fee-for-service model to lower the overall fee for customers. The Glendale-based startup also plans to engage with the LA startup community by offering their service as an HR benefit for people looking for local homes.
“Historically LA has been a real estate town,” Schoenholtz said. “When you talk to people, housing and architecture seem to be at the forefront of the conversation and it seemed like a community we could tap in to.”
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