OpenAgent Review 5 Reasons to Avoid OpenAgent

Note: This is an opinion piece regarding Open Agent services. The reader should do their own research and come to their own conclusions regard the services provided by OpenAgent.

Well Open Agent have got themselves more funding, and are pushing even harder into the real estate arena, so I think it’s about time that a professional like myself pushes back and gives these guys a bit of a reality check. Not everything is as it seems on their ads..
If you don’t know who OpenAgent are, have a quick read here to get the gist.

: OpenAgent Review 5 Reasons to Avoid OpenAgent

Open Agent Review 5 Reasons to Avoid Open Agent

1: OpenAgent is NOT a free service.

Open Agent charge agents 20% of their commission on sale of your home.
Assuming an agent commission of 3% on a 700k home that works out to be $4620 (gst inc.).
That’s right, the agent gets charged nearly $5000 for an introduction to you.

If you had gone directly to the agent, and bypassed OpenAgent, you could have negotiated a substantially lower commission. This agent is probably low on listings & sales, needs to get the ball rolling again, and is willing to work for 20% less !
It really is that easy.

2: Agents can, and do pass on this 20% fee to the seller.

Openagent has absolutely no control over the commissions agents charge, and it is completely up to the agent as to whether they pass this fee on. OpenAgent will that agents don’t pass this on, but the reality is they have no idea what the agent does. and has no authority to enforce this. To say the fee is not passed on is misleading at the very least. Don’t forget, OpenAgent is just a “ratings website” (now being imitated by many other organisations) with no special powers of influence in the real estate domain, and has absolutely no say in regards to how real estate agents function.

It’s simple really, put yourself in an agents shoes…. if you were asked to take a 20% pay cut for an introduction to a seller or simply pass on the fee what would you do??

3: Many of the best agents will not accept OpenAgent referrals.

It is highly likely you will NOT get the best agent in your area if you use OpenAgent. Many of the top agents won’t deal with them. Top agents get referrals from previous happy customers and their reputations, and refuse to deal with parasite organizations that wants to take 20% of their commission. After all, the amount of work required to sell a home remains the same, they incur a significant fee, and many consider the use of such organisations as a last resort for desperate agents.

A colleague of mine has described it in the best possible terms:
“Name one highly successful salesperson with a constant stream of Listings who would give away 20% (PLUS GST) of their fee to join the lowest performing people and squabble over the scraps… I can’t think of any who would...”

I refuse to deal with OpenAgent, as such people using OpenAgent to sell their home in Canning Vale won’t get referred to me. I’m fine with that. I’ve been the top Agent in Canning Vale for the last 3 years, so sorry guys, if you’ve been referred to a Canning Vale agent via OpenAgent it won’t have been me……. What OpenAgent should be saying is they will find the best agents in your area that are willing to accept an OpenAgent referral (I call it “the best of the rest”)…… after all, OpenAgent might have to ring 20 agents to get the 3 or 4 agents who finally accept. Many of the best performing agents, like me, will tell them to go away.

Oh, and just because an agent’s face is shown on the OpenAgent website does not mean the agent will accept a referral from OpenAgent! It would seem that every agents face is shown by default!

4: Meaningless Advertising Claims.

Example of advertising gems from their website:

“I sold my house for $120,000 more than what I expected”
Anne McDonald, Melbourne, VIC

“We got $75,000 more than the highest sale in the block”
Ken and Rosemary, Sydney

Adverts like the above are simply insulting

What do these claims even mean? For all we know the houses could have been twice as large as anything else on the block. It’s a real insult to the public that companies like this can spend thousands of dollars on TV adds to make such ambiguous claims.

If OpenAgent has results that can actually be substantiated, please, let me and everyone else know !!

5: Why use OpenAgent? RateMyAgent provides a superior service easier, & FOR FREE?

One of OpenAgents TV ads has a guy stating “I don’t have time to research for local agents”.

Well my friend, you don’t need too.

The best agent ratings company out there, Rate My Agent, concentrates on collecting verified reviews and sales data for all agents, and provides a list of the best agents for each suburb for free. That’s right. Just about everything that OpenAgent claim to provide and charge so heftily for is readily available for free from Rate My Agent.

Oh and RateMyAgent does all this without the need for you to fill out any online forms with your personal details, or wait for a sales person to get back to you. With Rate My Agent, all agent information is available at your finger tips.

All you have to do is search for your suburb on the RateMyAgent site and up pops an easy to use list!

Just one more thing to keep in mind. OpenAgent claims it “makes everything so easy” but the reality is, the only thing OpenAgent provides you with is a short list of agents.

Once you get this list, you will still need to:

contact the agents
interview the agents
get appraisals on your home
negotiate fees
decide on an advertising budget
make a decision on who to use

The fee OpenAgent charges seems like a lot to pay for what is basically a simple list.

I know which company I’d choose.

Summary : OpenAgent Review 5 Reasons to Avoid OpenAgent

If you do decide to use OpenAgent, then understand 2 things:

If the agent recommended to you chooses to absorb OpenAgents 20% fee, then you know for sure that if you had approached the agent directly you could have saved yourself $5000 (based on the above example) by negotiating the commission. Obviously this agent needs the listings ans is happy to work for 20% less!
If the agent chooses not to absorb the 20% OpenAgent fee and passes this on to you, well, you’ve just paid $5000 for a list. Oww

If I were to suggest a better use of OpenAgent’s services (and the list they provide) perhaps use this list as a guide to which agents in your area it might be wise to avoid.

If I were to provide a realistic interpretation of Openagents services it would be as follows:

“Open Agent collect a mix of verified / unverified agent reviews from the public, combine this with readily available sales data, to create a short list of the best agents in your area (but only from those agents that have agreed to deal with OpenAgent). For this service OA charge the agent 20% of their commission on successful sale, which, at the agents discretion, may or may not be passed on to the seller. PS please note OA do not guarantee these recommended agents are actually the best agents in your area”

Doesn’t really sell very well does it?

OpenAgent Review 5 Reasons to Avoid OpenAgent

Note: To OpenAgents credit, they now openly discuss the fees they charge agents for their services. When I wrote my first review about them, this was not the case, and it was almost impossible to verify just what they were actually charging.

Note to Real Estate Agents

Your face will automatically be shown by default on the Open Agent website.
If you don’t wish to be associated with OpenAgent, you need to actually contact them and tell them to remove your details. Even if you don’t accept referrals from them, you face will still appear in the list of agents for your area. This strategy by OpenAgent would appear to be attempt to legitimize their services by showing every Agents face, even those that refuse listings from them.

OpenAgent Review 5 Reasons to Avoid OpenAgent

OpenAgent Review 5 Reasons to Avoid OpenAgent

OpenAgent Review 5 Reasons to Avoid OpenAgent

Open Agent Review 5 Reasons to Avoid Open Agent

1: OpenAgent is NOT a free service.

2: Agents can, and do pass on this 20% fee to the seller.

3: Many of the best agents will not accept OpenAgent referrals.

4: Meaningless Advertising Claims.

5: Why use OpenAgent? RateMyAgent provides a superior service easier, & FOR FREE?

Summary : OpenAgent Review 5 Reasons to Avoid OpenAgent

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