Last month, Greg Tracy stood up at a real estate conference and told a roomful of people about his newly launched Salt Lake City-based real estate company, BlueRoof, and its use of online maps to display an assortment of properties.
What he didn’t know was that a representative from the local multiple listing service was seated in the crowd, and that MLS had some issues with the way BlueRoof was combining MLS data with other data at its Web site.
Tracy wrote in his blog after the conference, “Before you announce that you have FSBO properties and MLS data on the same map — make sure your local MLS representative is not in the room (apparently we’re not supposed to do that).”
And he said he has since worked to resolve the conflict with the rules of the Wasatch Front MLS. The MLS had no comment for this article.
It’s not that Tracy is new to the real estate business — he has worked in the industry for about 12 years, formerly serving as a broker for Prudential California in the San Francisco Bay Area and as a broker for Coldwell Banker in Salt Lake City. He is a newcomer, however, to the field of alternative real estate business models.
“The whole purpose behind it: We want to have a place to bring buyers and sellers together. Whether we make money off of it or not, we just want to have a resource and we think the consumer wants to have a resource where they can see all of the homes for sale,” he said.
BlueRoof, which launched last month, allows consumers to search for MLS-listed and for-sale-by-owner properties using interactive online maps, list their homes for sale, make online purchase offers, get a loan, and receive rebates. Tracy said the company offers agent representation for all transactions it assists — even those that involve FSBO properties.
“Everything we do is full representation. I think that the consumer wants the help of an agent. They don’t want to pay the historically high commission rate. We actually take people out in the traditional sense and show people properties,” he said. A staunch supporter of real estate agency laws, Tracy teaches an agency class at a local real estate school.
BlueRoof offers a range of service and price options. The company’s do-it-yourself option allows consumers to search on their own for homes and make an online offer to purchase and receive one-half of the buyer’s agent commission in a closed transaction. Those buyers who choose a full-service option can receive a $500-$3,000 rebate at closing, based on the price of the house. Sellers pay BlueRoof a commission of 1 percent of the sale price of the home and choose how much to offer to an agent who brings in a buyer. Consumers can receive an additional rebate for working with Blue Roof Mortgage.
FSBO sellers can list properties for free at the BlueRoof.com site for up to six months. Rather than a pure FSBO model in which there are no agents involved, buyers can make offers through the BlueRoof site and the company coordinates these transactions until they close — for a $1,000 fee.
Web site users can search for MLS-listed properties, new-construction homes, FSBO properties, “agent-friendly” properties that are FSBO properties offering compensation to buyer’s agents, and homes listed in the past week. Other search criteria include county, city, minimum and maximum price, bedrooms, bathrooms, square footage, garage size, year built, and condo or home.
The site offers a list of contractors, and Tracy said there are plans to allow site users to rate contractors. Users can also post comments about particular communities.
There are about 70 FSBO homes now listed at BlueRoof.com, Tracy said, and site users have made two online purchase offers. Other alternative real estate brokerage companies are also assisting the FSBO market. Southern California-based CataList Homes announced in July that it is allowing free FSBO listings at its Web site, and ZipRealty announced this month that it is offering a marketing program that assists FSBO sellers.
Six years ago, when Tracy was working in California, his company participated in a real estate transaction in which the buyer did not set foot in the house until after the purchase. The buyer viewed a virtual tour and online photos prior to the purchase. He said the transaction clearly showed the potential for online technologies in the real estate industry. “It was a great deal but it was kind of ahead of its time,” Tracy said. “Ever since then I wanted to do business online in real estate.”
While promoting FSBO-type property listings may be unpopular with some real estate professionals, Tracy said there are a lot of do-it-yourselfers in the Salt Lake City area. “It’s the kind of market where people sell their own home, sell their own car, fix their own house … it’s sort of a do-it-yourself community.” And the consumers are tech-savvy, too, he said.
“Our (business model) is all about choice. Some people want to do the work themselves. If they want help right from the beginning they’ll still get a rebate back. There is not much difference now (at BlueRoof) versus what we were doing at Coldwell Banker — just a lot less commission,” Tracy said.
To promote its launch the company has paid for billboard and television ads. “I’m banking everything on it,” Tracy said. The company has a team of 12 employees, and all of the agents are Realtors. The company has plans to expand statewide within 30 days, and “we plan on being in a few states by the end of the year,” he said.