Does Comfree work?

By Curt Knight

As a realtor obviously I have my own bias.  But this question comes up from time to time when I meet with clients who are thinking of selling their home. COMFREE has done an exceptional job of marketing themselves over the last few years and has gained some market share.  However, there are always two sides to every story and I thought it would be good for people to here from an industry insider and form their own opinions.

My wife and I actually attended a COMFREE seminar a few months ago  where you can learn “how to sell your home on your own.”  We went more or less just to see what it was all about and to learn about their model and the competition.  I thought it would be a lot of realtor bashing but they were actually pretty good.  In fact COMFREE now has many realtors on their staff.

COMFREE has developed an interesting business model.  They have come up with a wide variety of services to offer to the consumer and the consumer can pick and choose what services meet their needs and budget.  The speaker went through all the different packages but when it came to FULL package I started doing the math and couldn’t help but think- wow you are getting up there quick.  If you go with the full package this includes things like MLS listing, full signage, professional photos, support with negotiating, paperwork, legal advice etc. you are getting pretty close to $2000 plus you still have to do all the work of a realtor- showings, answering phone, open houses, advertising and so on.  The problem is they present the packages in a piece meal form that makes it seem like you are paying less.

Also the seminar we attended they mentioned an interesting statistic- they said that 70% of COMFREE listings sell by a real estate agent- and they actually encouraged COMFREE sellers to agree to co-operate with Buyers Agents (meaning pay them a commission) so more than likely you will still end up paying a Buyer’s agent 2-3% commission, on top of COMFREE’s fees.  I wondered to myself why would they tell people this- after all aren’t most people there to save paying commissions? But after thinking about it for a bit it made sense- they want people’s homes to sell- I mean if homes don’t sell then sellers are not happy- which isn’t a very good business model is it?.   They know the best way to sell a home is with a realtor- Why? Because most buyers out there are working with a realtor- why wouldn’t they? -it doesn’t typically cost them anything as the seller pays their fee’s when they purchase, so therefore they can get the support and help of a realtor to ensure they are not overpaying- which is most buyers biggest concern with private sales.

The other thing I would caution people with is that from our experience many people looking on the private for sale sites are “deal shoppers.”.  They know you are saving money on commissions and they expect some of that savings to be passed on to them. We often find the buyers are also unqualified.  When you work with a professional realtor- the first thing we do is verify that you can get the financing.  With private sales we find that in many cases buyers are not pre-qualified and therefore more deals tend to fall apart.

One of the biggest issues I find with COMFREE is they claim it will go on the multiple listing service or MLS.  This is true it does go on the public  MLS site- however I find most sellers think this means it goes on the local real estate board,  so realtors will get to see it and show it to potential clients- this is not the case.  The issue is that when posting a listing on MLS it is required that the listing must go on the home brokerages board (where the brokerage is located).  COMFREE is not located in Kitchener Waterloo or many other cities- it is in either Hamilton, Toronto or Ottawa- so when I do a search for a property on our system (the realtor system) the COMFREE listing will not show up in our search.  This is problematic because as I said above most buyers are working with a realtor so if this is the case typically we set them up on search using our system and have properties come to them via email- the COMFREE listings will not show up because they are on the Ottawa, Toronto or Hamilton real estate boards.  They will show up on the public MLS but the majority of buyers are not searching there because their realtors have a search set up for them.

It is very annoying for us as realtors because from time to time we have a client say “why didn’t you send me this property?”  I will then look it up and I can’t find it on our system- then when I check the public site it appears but as a COMFREE listing.  It’s frustrating because in essence we are not able to do our job because we are not getting all of the properties that are currently available on the market.  It is actually contradictory to our Buyers Representation Agreement that we sign with our clients which states we will make our clients aware of all properties available on the market. In my opinion it should be mandatory that all listings be posted on the real estate board where the property is located.  This is not only a problem for companies like COMFREE but for agents who are out of town unless they pay the extra fee for it to be on the board where the property is located.

Another downside when you list privately or with a company like COMFREE is it’s difficult to create the hype and urgency you get when you list with a realtor on MLS.  There are fewer bidding wars with private sales and without the realtor to coach buyers on how fast the market is moving many buyer will not step up to the plate.  Here is a testimonial that illustrates this point from one of our clients:

“Dear Curt and Erin,

We are so thankful and completely satisfied with the dedication and hard work you both put forth in helping us purchase our new home, and sell our existing home.  In the beginning we were set on using ComFree to sell our house in hopes to capitalize on a commission free sale.  Erin and Curt were both supportive in our decision, and still offered to help with anything we needed in order to help us sell quickly.  Our ComFree package was purchased, and the appointment was setup, but something didn’t feel right with Erin and Curt.  They called a few days before the appointment with ComFree and showed us a few different scenarios regarding a ComFree Sale and a Sale with Knight Homes.  It truly showed the professional experience, knowledge and hard work ethic these two both have.  We couldn’t believe that even though we had decided to use ComFree, they still cared enough to help us through the process.  After that call we quickly called ComFree to cancel our appointment and package and went with Erin and Curt and Knight Homes.  The Knight Homes sign went up on Thursday, multiple showings, and an open house on Sunday gave us multiple offers on Monday, where we accepted an offer substantially over asking that netted us more than we would have saved listing ourselves.  We are so pleased with the outcome and if it were not for the hard work and commitment these two have to their clients, I honestly believe that the outcome would not have been the same.  Thank you both very much!! We are Knight Homes Clients for life!!” 

Finally a big variable you need to factor in is your time- if you are a parent or a busy professional do you have the time to take calls, show the home, host open houses, negotiate the contract etc.  What is your time worth?  For those that have ample free time, retired or maybe just enjoy the challenge- than for sure this might be the right move for you.

In Summary, can selling privately or with a company like COMFREE work- absolutely it can!  If you have the time to do it, the right home, in the right location that shows well and you can attract the right buyer- more than likely you will be ahead of the game doing it yourself and not paying commissions. However if any of these variables is not right- you are going to find selling your home a very stressful and complicated process.  You could end  paying both COMFREE and Realtor Commissions when you switch if you can’t sell on your own- in turn netting you even less.   Remember realtors don’t get paid unless the home sells- COMFREE gets paid either way.

Comments or Questions always welcome…

14 thoughts on “Does Comfree work?

  1. Thank you. I am selling my house and was thinking about using Comfree. Your article was very informative and useful. Still tossing up. If I can save myself a few thousand dollars I am all for the leg work. I certainly think the buying agent should get commission.

    Again thank you.

    Jackie

    • I just posted my comments below. I am so far happy with ComFree, paying 2.5% commission to buying agent, all OREA paperwork done by lawyers and ComFree offer assist brokerage. Costed me so much less to list my home on MLS as we got a $400 deal for their highest plan + MLS listing free. Great deal. We will still save over $15K in commission, that I will use to buy my second bike LOL.

  2. We’ve bought and sold a number of houses on the West side of Toronto and always were a little turned off about the commission that was paid out at closing. We made a choice to try Com Free and were enthusiastic. There service is good however, in Toronto the market is pretty well completely controlled by the agents and even though we were priced on the low side, we got no offers. After 3 weeks went by we gave up. We will now list with our agent we used before. I met another guy in the neighbourhood who had the same experience. Listed first with ComFree, worked hard for 3 weeks, gave up then sold with a realtor within a week. In slower rural markets, it makes sense. In the frenzied Toronto market, you’ll waste your time. I bought privately once, and it was by far the most satisfying and least manipulative experience I’ve ever had. In short, buy privately, get the most honest, least manipulative exchange, but sell using an agent if you’re in any kind of intense market. I wish it was different, but that’s just reality.

  3. I have owned and sold more than 5 houses so far, almost all over $700K. Now selling our $950K home using ComFree and we are so far happy. Exposure is good and their offer assist program works just fine to negotiate an offer and close the deal. We are also paying full 2.5% commission to buying agent so no worries. One fact though; Open Houses are there to help the seller agent to generate his/her own future clients, nothing else. Open houses don’t really sell properties. We never sold our past houses to a buyer who came for an open house, none so far. All our buyers were just spontaneous and quick. It is a good experience to sell home using ComFree, pay full 2.4%commission to buying agents and you are good. Just my three cents.

  4. Another downside of comfree is that you have to go around removing to the garbage those signs that litter every corner in the neighbourhood. I don’t wonder if those selling with comfree would like it if I put a stick in the ground near their home with an empty cigarette package and tin can attached. They would not so please put the sign on your lawn and don’t polute your neighbourhood.

  5. Like any product in the world…. the more exposure you can offer to it the more money you can obtain for it. I’ve sold over 25 homes in the last 10 years and I can tell you that focusing on saving commission vs. where can I get the highest dollars is a huge mistake. Why save 5 or 10k if you lose out on a massive marketing program that generates you far more offers resulting in far higher prices points that totally outweigh saving a bit of commission. It makes no sense and really only short sighted people will chose this path. The problem is most people who feel this way normally are misinformed or have had poor experiences with the real estate community because they did not vet their agent AT ALL or they picked the wrong agent. Like any business including my business there is going to be a handful out of hundreds that are excellent at what they do. If you pick the right one you will realize the benefits. If I hired a crappy lawyer I’m going to believe lawyers are worthless as well. Same goes for a plumber. Mine as well do it myself and save 50 bucks.

  6. We sold with Comfree this past August (located in Stoney Creek). We confirmed that we were posted through the Toronto Real Estate Board (biggest board in Ontario to add) and although we were not listed through the Hamilton local board I have to say that I had no shortage of private buyers and buyers working with agents come through my house…to be honest it was a happy medium of both. Clearly agents had no issue finding my property…I think if you’re a good agent you don’t just insert your client’s email into your system and allow the system to do your work for you…if you’re a good agent you’ll do your due diligence to use all the tools available to you to search for properties… No? Would you hire an agent who solely relies on a system to update you on available and new properties for sale? What is your dream home is listed by Comfree and you miss out on it because your agent doesn’t bother checking Realtor.ca or even comfree.com for that matter?! As a Comfree client we were more than willing to co-operate with agents if they brought us a buyer..we knew it could go either way and you just never know where your buyer is coming from..and we knew we were already saving the commission for listing our property.
    Anyways going back to the sale of our home our first offer was from a buyer with an agent who totally low-balled us (40K below asking plus wanted 2.5%) we tried to counter but it just didn’t get anywhere…three weeks later we received a firm offer from a private buyer who gave us full asking! To add our buyers listed with Comfree and sold within 24 hours over asking with an agent and paid only 1.5% to the buyers agent! So all in all there are many factors to consider and honestly it just takes ONE buyer..who may or may not be working with an agent…you never really know. There is no sure thing whether you list with an agent or a company like Comfree…but I can honestly say the exposure and support I received from the team at Comfree was exceptional!
    My parents hired an agent last year to sell and buy and I wish I had known about Comfree back then! All this agent did was insert my parent email into their system for them to get automatic emails of new properties. No pre-screening or anything…we were bombarded with daily emails with new listing that weren’t even close to what we were looking for! That is what I call “annoying”. I ended up checking Realtor.ca every evening and found my parents the perfect bungalow that they were looking for! Their agent ended up just putting together the offer and got paid just over $8000 for what really?! He honestly did nothing but insert their email into the system and draw up the offer.
    I am sure there are great agents out there that will work hard for you to sell your home but if you can pick up the phone and show your home there is potential to save big! We saved 25k!…which allowed us to put $ into our children’s education fund, buy brand new appliances and still have $$ left over! Like this agent says “There are always two sides to the story” —here’s mine :)

  7. We just sold our condo and bought a home. We decided to go with an agent because we knew it wouldn’t lose that much money to our selling agent because our condo wasn’t priced very high. But thinking about selling our house in the future over $400,000 and giving the selling agent upwards of $10,000 for what exactly? Getting us to sign on the dotted line that they print out of a OREA screen? Having an open house, maybe two? Really the buying agent does all the work, so as long as we offer the buying agent the 2.5 % we save our $10,000.

    Our condo sold in 3 days, the selling agent didn’t do anything besides put the ad on MLS and put a lock box on the door. No offense, but agents need to re-think their commission fees, I can see many people deciding saving thousands is more worth it in the end.

  8. That testimonial was kind of absurd. “We couldn’t believe Erin and Curt stuck around and whispered in our ear after we chose ComFree. They were so helpful with no ulterior motives at all. Why would they be so helpful? Then we went back to them and bailed on ComFree. Oops, we answered our own question.”

    Just sold my home w/ ComFree in 4 days for way over asking. 14 buyers came through in two days after the listing got on REALTOR.ca, all w/ agents of course. A frenzied market means all sellers get their home seen, no matter how “professionally” they market it; so I don’t understand Brian’s comment. Paid 2.5% to buyers agent; cost of doing business. Sold a home previously via ComFree (then ByTheOwner.com) to a private buyer; that’s the sweet spot, and when ComFree really earns its name. Tough to find a private buyer, though, then and now. Not sure why. Private buyers have the advantage. Their offers are worth ~2.5% more than all the others.

    I ran the numbers on ComFree vs. agent, and there are few key variables that can swing the advantage either way: seller’s agent commission, agent factor (effect of agent’s skills on the selling price), buyer’s agent commission.

    Buyer’s agent commission — This one will be between 2-2.5%. But if you hit the jackpot w/ a private buyer, it’s zero, and the private sale wins hands down. But private buyers are hard to come by.

    Seller’s agent commission — If you have an agent friend, they’ll list it for 1%. Anyone else will want 2.5, I would suspect. They might go as low as 2%; depends on the area.

    Agent factor — This is a tough one. Who really knows how much more a listing agent could get for your home? I’d like to see some numbers comparing average sale price with listing agents vs private for an area. But this one also has a huge impact on the comparison. If you can believe an agent can sell your house for 5% more, agent edges out even a private-private sale (assuming . But 5% on a $500k home is $25k; that’s a big difference. I had a flurry of buyers come through, so I don’t think an agent could have gotten me more traffic. Perhaps an expert agent would have listed at a higher price, yielding higher offers, but that might also reduce traffic, thus reducing the odds of an outlier high bid.

    So assuming you sold your house 100 times, and the average seller’s agent commission was 2%, average buyers agent commission 2.5%, and assuming 3/10 buyers are private, the agent factor would have to be about 3% to break even, meaning on a $500k house, they’d have to get you ~$515. If they only get you $505k, private would save you $10k. If they get you $525k, agent wins by $10k.

    Conclusion — In a hot market, I don’t see the agent getting me $15k more on a $500k house, so I choose ComFree, and I work for that private buyer.

  9. Pingback: Does COMFREE Work? - Part 2 | Knight Real Estate Investment AdviceKnight Real Estate Investment Advice

  10. Sold last 2 homes in West GTA using ComFree (2015 and 2012). Worked like a charm. Sold first house to private buyer with no agent and last house to a couple with an agent. Paid 2% to agent, all-in and, since I was our Listing Agent, the money we saved, paid me for my services and time, indirectly. Great savings that we put towards upgrades in our new-build home in Ottawa.

    We have been here, in the West Ottawa Area now, for 5-months. And, the next time we sell in 2016, we know that we WILL BE listed on the Ottawa Real Estate Board, since a realtor showed us a ComFree-listed home with 4-others listed by ReMax and RLP—in December 2014. So…this agent had NO problems finding this ComFree hom, online….to show to us !!

    First home took 5-weeks to sell in Jan/Feb 2012 and we held OHs every Sunday until the sale was firm. We did the same thing earlier this year. Will do it again in 2016, in Ottawa and the Offer Assist Program makes the haggling/negotiations painless and more business-like. Our first ComFree sale in 2012 had us signing paperwork at our kitchen table. Too chummy-chummy for my taste. Now, I urge everyone out there with ComFree to purchase the Offer Assist Program. You only pay for it at Claong and the will negotiate the Buyer’s Agent commission, too! Entire process using a ComFree Realtor makes it “nothing personal —just business”—which is exactly how it should be!

  11. I don’t agree. If the house is not bad they just sell whether an agent is involved or privately sold. Saving whatever money is savings at the end. Pricing the house right is the key here. Agents can in fact price the house so low that it gets sold faster because it doesn’t hurt them at all but does make a difference to the seller. If the house is hot it will sell at best price whether an agent is involved or not.

Leave a Reply

Your email address will not be published. Required fields are marked *