For anyone not paying attention to Inman News, or some other source, you might have escaped noticing that Help-U-Sell's franchiser filed for Chapter 11 Bankruptcy recently (reported Friday, August 15th, 2008).
Since 2006, their franchise offices have shrunk from 820 to about 450.
Go read the story before it drops behind the Inman curtain... And then let's think about something.
Ready?
Those that are touting discount brokerage have been calling on the death of the "traditional" real estate brokerage for some time. When the market started to slide, they knew that discounters would prevail and full service brokers would fall by the wayside.
After all, times are tough and equity is scarce. People that are selling don't want to give all of their equity to a real estate agent. Obviously, saving money is the better plan...
But...
That hasn't been how it worked. And the discounters should have known this. Help-U-Sell went through bankruptcy during the last downturn, in the mid 1990s. So, why? Easy... when the going gets tough, sellers need a brokerage that can deliver. The discount model doesn't deliver in a tough market. One simply can't deliver appropriate marketing for a property in a tough market for $599. In fact, one can't deliver ANY marketing for a property for $599. By the time they pay their fees, they don't have much left...
And then there is the "Secret"
sshhh... don't tell anyone. They don't care if you sell your home. Doesn't matter. They still get paid. BuyOwner.com still gets paid. Help-U-Sell still gets paid. FSBO.com still gets paid. They get paid to list your property. They don't get paid to SELL your property. The traditional agent ONLY gets paid if they deliver. They take on the risk and expense. **I have been notified by a franchisee that Help-U-Sell doesn't charge upfront for their services. I can't confirm it through their website, but I'll take his word for it.**
It'll be ok...
Help-U-Sell will probably emerge from this BK like they did the last one. Until the market soars... and they soar again... and then the market poops... and they poop again.
Unless otherwise noted, all content of this blog is the property of Lane Bailey, ©2012 Lane Bailey.
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