As a former Regional Sales Manager with RealEstate.com, I was charged with recruiting, hiring and training new agents. I was given materials to "sell" the company to real estate agents and get them come to work for RE.com. What they don't tell unsuspecting real estate agents is that RealEsate.com's entire business plan is based on the agent's averaging "only two sales per year!" No one can live on that!
Once the agent starts, they eventually get their first sale under contract, typically 45-70 days after they start. 45-60 days later, the escrow closes. After four to five months of work the agent receives their first commission. On a home with a sales price of 200k the agent walks away with only $1,750 after the E & O fees as compensation for four to six months of work! The company keeps $4,250!
By the time the agents realize how little they're making working with this unfair system, they usually have a second sale in escrow, so their stuck waiting for the second escrow to close, before they quit and move on the a company where they can actually make a living.
Thus we have the business model of RealEstate.com: hire an army of agents who will average only two sales per year, so the company can make a profit of the backs of unsuspecting agents. Yes, they are very clear about the compensation with prospective agents, but only one out of ten actually does the math. And when they do, they're usually angry that they wasted their time talking with these people.
When I was hired, I was given 87 agents to manage. What I found was that 22% of the agents listed on the roles now worked for other companies and that another 25% were not actively working in real estate anymore. They were just names on a list, inflating the head count of a publicly traded company!
I wonder what the stockholders would have to say about that?
This business model is the same as the "theory of 1,000 monkeys." Lock 1,000 monkeys in a room with 1,000 typewriters and based on simple averages, at least one of them will spell a word correctly.
Hire an army of agents, and you'll average at least two sales per agent. Never mind that most of them go broke in the process.
If you come into contact with these people, don't walk away, run away as fast as you can. They tell a really great story, but understanding the real story from the inside out, it's not at all what it is promoted to be. Work with RealEstate.com and you'll go broke just as fast as if you spent all of your money on lottery tickets.
These are very bad people!
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