“To qualify as a Blend Realty partner agent, you need at least three years of experience, be closing at least eight transactions a year, and agree to provide Blend Realty’s 0.6 percent commission rebate to homebuyers.” Erik Wrobel
In other word, Blend Realty is a blatant hardcore #pricefixing scheme between real estate brokers.
“Blend Realty’s blanket referral agreements further require colluding brokers to price fix their rebates at 1% of the total home purchase amount refunded to their homebuyer from the Buyer’s Agent Commission (BAC) received.”
In just few months, Blend seems to have randomly changed the price fixed amount of the rebate a colluding broker must offer to the consumer from 1% to 0.6%, which drops the total amount from 30%-40% buyer commission rebate to about 15%-20%. This “offer” to homebuyers is a “dangling carrot in front of the nose” to attract them toward the scheme, rather than to deliver genuine savings. Consumers are able to get much better savings on the open market, everywhere, from a legitimate agent.
Why the drop from 1% to 0.6%? Well, I don’t know… Price fixing does not require an explanation, its just is.
I suspect that that it is easier to get more brokers in the scheme if the price-fixed amounts are less. I am sure Blend did study, a board meeting, and a lengthy corporate slide that shows how they can price fix a service fulfilled by a third party.
In the real world, Blend and Blend Realty are a single company, both designed and built with massive VC capital to rake hidden fees, by-pass #RESPA, collude with independent brokers for a cut of their commissions, and openly price-fix services of others.
The purpose of Blend is to “plug consumers into kickbacks,” but I bet consumers are not so easily “plugged.”
The time will tell, but, as of today, Blend remains open for business, yet another hub-and-spoke criminal conspiracy of random brokers willing to pay 20% of their commissions some to a random scheme for the privilege to engage in a felony.
Founders Fund Greylock General Atlantic Temasek Holdings Canapi Ventures Coatue Management, Tiger Global Management are some of the early investors in Blend.
#antitrust #realestate #homebuying #vc #disruptiveinnovation #businessasusual