Real-estate agent commission structure and sales performance

Pieter Gautier; Arjen Siegmann; Aico van Vuuren

doi:10.1016/j.jempfin.2023.03.006

Real-estate agent commission structure and sales performance

Pieter Gautier, Arjen Siegmann^*, Aico van Vuuren

^*Corresponding author for this work

Research output: Contribution to Journal › Article › Academic › peer-review

Abstract

We study the transaction prices and sales times of a new type of real-estate agent, the “internet agents”, who operate mainly online. Competing on the same Dutch online listing platform, these internet agents charge a low fee up front and leave the viewings to the sellers. Using a nation-wide dataset of residential real-estate transactions, we find robust evidence that sellers who use internet agents obtain higher prices and sell faster but they are also more likely to switch to a traditional agent or fail to sell than sellers who use traditional agents. These results are consistent with a model in which sellers learn over time about their skills and where good sellers benefit from and sort at internet agents. Some of our findings also support the view that real-estate agents have market power.

Original language	English
Pages (from-to)	163-187
Number of pages	25
Journal	Journal of Empirical Finance
Volume	72
DOIs	https://doi.org/10.1016/j.jempfin.2023.03.006
Publication status	Published - Jun 2023

Bibliographical note

Funding Information:
The authors thank Johan Walden, seminar participants at the VU and the European Finance Association 2016 and an anonymous referee for useful comments and suggestions. We thank NVM, the “Nederlandse Vereniging van Makelaars o.g. en vastgoeddeskundigen” for providing the data. Aico van Vuuren received financial support from Vetenskapsrådet, Sweden , under registration number 2017-00872 .

Funding Information:
The authors thank Johan Walden, seminar participants at the VU and the European Finance Association 2016 and an anonymous referee for useful comments and suggestions. We thank NVM, the “Nederlandse Vereniging van Makelaars o.g. en vastgoeddeskundigen” for providing the data. Aico van Vuuren received financial support from Vetenskapsrådet, Sweden, under registration number 2017-00872.

Publisher Copyright:
© 2023 The Author(s)

Keywords

Agency
Housing
Market power
Real-estate agents

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title = "Real-estate agent commission structure and sales performance",

abstract = "We study the transaction prices and sales times of a new type of real-estate agent, the “internet agents”, who operate mainly online. Competing on the same Dutch online listing platform, these internet agents charge a low fee up front and leave the viewings to the sellers. Using a nation-wide dataset of residential real-estate transactions, we find robust evidence that sellers who use internet agents obtain higher prices and sell faster but they are also more likely to switch to a traditional agent or fail to sell than sellers who use traditional agents. These results are consistent with a model in which sellers learn over time about their skills and where good sellers benefit from and sort at internet agents. Some of our findings also support the view that real-estate agents have market power.",

keywords = "Agency, Housing, Market power, Real-estate agents",

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note = "Funding Information: The authors thank Johan Walden, seminar participants at the VU and the European Finance Association 2016 and an anonymous referee for useful comments and suggestions. We thank NVM, the “Nederlandse Vereniging van Makelaars o.g. en vastgoeddeskundigen” for providing the data. Aico van Vuuren received financial support from Vetenskapsr{\aa}det, Sweden , under registration number 2017-00872 . Funding Information: The authors thank Johan Walden, seminar participants at the VU and the European Finance Association 2016 and an anonymous referee for useful comments and suggestions. We thank NVM, the “Nederlandse Vereniging van Makelaars o.g. en vastgoeddeskundigen” for providing the data. Aico van Vuuren received financial support from Vetenskapsr{\aa}det, Sweden, under registration number 2017-00872. Publisher Copyright: {\textcopyright} 2023 The Author(s)",

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doi = "10.1016/j.jempfin.2023.03.006",

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N2 - We study the transaction prices and sales times of a new type of real-estate agent, the “internet agents”, who operate mainly online. Competing on the same Dutch online listing platform, these internet agents charge a low fee up front and leave the viewings to the sellers. Using a nation-wide dataset of residential real-estate transactions, we find robust evidence that sellers who use internet agents obtain higher prices and sell faster but they are also more likely to switch to a traditional agent or fail to sell than sellers who use traditional agents. These results are consistent with a model in which sellers learn over time about their skills and where good sellers benefit from and sort at internet agents. Some of our findings also support the view that real-estate agents have market power.

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Real-estate agent commission structure and sales performance

Abstract

Bibliographical note

Keywords

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