DeLeon Realty is constantly improving and revolutionizing the residential real estate business model. One of the fundamental flaws of the current model is that it is built around the agent’s goals and needs as brokerages fight to recruit top real estate models. Brokerages go out of their way to stress their agent-centric focus and qualities.

DeLeon Realty has created a brand new model that is instead client centric and built around what we feel clients both want and deserve.  One clear example of us highly prioritizing clients’ needs, goals and finances is where we waive 100% of the buyer’s side commission when we represent a buyer on one of our own listings.  We do this to avoid the conflicts of interest and bad judgement that can occur when one agent or even agency is seeking to double their commission by representing both sides. DeLeon Realty never allows the same agent to be on the same side of a transaction, and when we do have a different agent advocating for their respective client on each side, we further reduce the incentive to put our interests first by eliminating all financial temptation. Thereby both of our clients win as sellers pay less commission and our buyers get a valuable advantage.

This innovation greatly benefited our clients, particularly our sellers (although our buyers gain as well). The next evolutionary and revolutionary benefit we are providing our VIP buyer clients is that we are willing to align interests and create a performance-based model for buyers agents.

A current major problem for buyers is that their interests are not aligned with their buyers’ agent.  Sellers and their listing agents do have their interests aligned, for the more the sell the home for, the more both the agent and seller receive.  Buyers and their agents actually have their goals inversely aligned, for the more the buyer pays the more commission their buyers agent will receive since a higher sales price results in a higher commission.  Additionally, a higher price bid by the buyer will also result in a quicker sale, so the dollar per hour the buyers agent receives is much higher.

DeLeon Realty has created a new policy for our committed buyers that for the first time aligns both buyer and their agents’ interest by creating a performance-based commission structure for when you sell your home.

DeLeon Realty strongly believes in our ability to find and negotiate excellent values for our clients as well as direct our clients to the neighborhoods with the most appreciation.  With this confidence, DeLeon Realty is the first residential brokerage to ever state that we will not make a profit for our listing services unless our buyers make more than $500,000 in gain in their first three years of home ownership!!!

We feel that presently buyers’ agents have no skin in the game and are not financially motivated to direct their clients to the homes that are the best value and in cities with the most appreciation potential.  In the (rare) event we do not achieve this $500,000 in gain for our clients, then DeLeon Realty shall sell their home at our costs instead of at a profitable commission rate.  Our new performance-based model lets buyers know that we have “skin in the game,” and by aligning our interests and goals with our buyers we have created a better model where clients can then fully trust the advice of their buyers agent.

This performance-based model is available for clients who purchase a single-family home in the neighborhoods that we feel have strong appreciation potential, provided they listen to our advice as to the maximum price they should pay. It does not apply to purchases before July 1, 2018 and we reserve the right to cancel this program any time prior to a client entering a binding contract.  All that we ask is that our clients hold on to this home for at least three years in the neighborhoods we are particularly optimistic on prices continuing to rise.  The list of neighborhoods that we feel have the greatest appreciation potential are proprietary and based on my empirical data plus my analysis, and this information is shared with our buyers.
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There are many benefits that buyers receive from this arrangement including: 

1. Complete Trust in Your Buyers’ Agent. 

I actually feel that the greatest benefit of this new model is that buyers can now fully trust their agent since both interests are now aligned. When I was an attorney at Wilson Sonsini, my clients fully trusted me, conveyed everything to me and allowed me to most effectively represent them. Many buyers withhold information from their buyers agent, such as how much they would pay for a property or other crucial information, that if known would allow their agent to provide the best representation. By aligning interests and truly being a fiduciary to our buyers, this allows for trust and a better outcome for everyone.

2. Saving Money in a Down Market.  

While the greatest benefit of our performance based model may be that buyers can now fully trust their agent, there is obviously a lot of value to the protection provided by the offer. If the market does not appreciate as much as we project and we do not make you over $500k in gain, then you can take comfort in knowing that our future commissions will be greatly reduced.

3. Confidence in Knowing that Your Agent Believes in the Market.

Given how much appreciation has occurred in the local market, many buyers are now worried that they are buying at a peak time and that a drop in prices may occur. With my background in Mathematics and professorship of Economics, I have been able to accurately project which cities and neighborhoods have the most appreciation. This model tangibly illustrates my confidence to direct our buyers to the right cities and opportunities where I feel they will make over $500,000 in gain. Only DeLeon Realty has the confidence in our abilities and this market to create this model. I recommend that all other brokerages follow our model for the clients benefit.

4. This Model is Very Tax Efficient. 

It is not a coincidence that I picked $500,000 as the amount that we are projecting you will make even more, for $500k is also the amount that is exempt from capital gains for your primary residence for a married couple filing jointly. So if my clients make less than $500,000 in gain on their home, every dollar in commission that I charge them is a full dollar out of their pocket. Yet if my clients make over $500,000, then they will pay a combined 37.1% in federal and state capital gains taxes. So when my clients make over $500,000 in gain, the government is indirectly paying for 37.1% of the commission since my clients would otherwise be paying capital gains on their profit. Thus, under this model we only charge clients our normal commission rate when they made a large gain on their home plus the commission helps reduce their capital gains.

To our knowledge, no other brokerage anywhere in the world has offered a similar model to this that we know of. Inspired by our innovative clients, DeLeon Realty continues to revolutionize how residential real estate is bought and sold by creating the first truly client centric and efficient model. As you can imagine, there are a lot of details to how this program works. Please contact me or any DeLeon Realty buyers agent to learn more about this latest revolution designed to help our clients confidently buy their dream home.