Does Selling Homes “Scale?”

One of the interesting byproducts of posting on a hot company — which Groupon and its social media brethren certainly are right now — is the raft of related search engine queries that follow.

So it is with “Groupon for Realtors.”

Work your way through the Google “hits,” though (besides my posts, “Memo to Groupon:  ‘Hurry, This Deal Expires Soon”; “Groupon’s Sales Price:  No Bargain“; “‘Groupon,’ Defined“), and what you discover is that no one appears to be trying to apply the concept of volume sales to real estate.

Rather, at least a couple Chicago-area Realtors are salivating at the prospect of selling upper bracket homes to newly-minted Groupon millionaires.

Cheaper By the Dozen

But the query does raise the interesting question, “could Groupon muscle in on residential real estate sales?”

Plus the related query, “do Realtors ever give volume discounts to repeat customers?”

My answers:  “I doubt it,” and “No, but I take very good care of my best clients.”

Economies of Scale

While I’m aware of investors who have negotiated discounts buying blocks of foreclosed homes directly from banks, at least at the retail level, there is no such thing as “economies of scale” selling homes.

That’s because, unlike say, ingots of steel or bushels of wheat — which are cheaper to sell in volume — each home is unique.

So, every new listing requires its own price analysis, photography, marketing literature, staging, disclosures, etc.

While it’s certainly true that as a Realtor, you become more efficient doing/assisting with all those things, home-selling doesn’t “scale” because by definition, homes aren’t commodities.

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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