Have you ever heard of Clever Real Estate? I hadn’t, but I guess they wanted me to know about them. A few months back I shared an honest review of HomeLight, and a few weeks later Clever Real Estate published their own review, with my exact same title. Copycats? You can decide.
Well, the folks at Clever should have realized that I love to review techie real estate startups. So, let’s get to it.
What is Clever Real Estate?
Clever Real Estate, or simply Clever, is a startup that hopes to get you a, “Better real estate agent to work with.” I’ve heard that one before.
The nimble team at Clever has done pretty well for themselves. According to Crunchbase, the company has raised $5M and has four employees. That means they are a pretty small firm in the space.
How Does Clever Work?
Clever promises this: If you list your home with them, they will charge a flat fee of $3,000, or 1% of the total sale price if your home sells over $350,000. They claim that saves you, the consumer up to 66%, or more, when compared to a normal agent.
Well, if it saves you plus or minus 66% when compared to another agent, then their claim must be right because basic math proves that it is impossible them to be wrong!
If you buy with them, I am not sure what they offer, besides a $1,000 rebate on purchases over $500,000, in some states.
Clever Real Estate claims to connect you with experienced and high-quality real estate agents from brokerages such as Coldwell Banker, Compass, etc. I would sure hope they do.
How Does Clever Make Money?
From what I gather, they refer you to an agent. In other words, if you buy or sell a home with the agent they hand off to you, that agent will pay Clever a referral fee.
How much work does that mean Clever has to do? Well, they have to convince you, a buyer or seller, to put your information into their site, instead of simply calling a local real estate agent.
What is My Review of Clever Real Estate?
Avoid Clever Real Estate at all costs. There is probably a joke to be made about Clever’s cleverness, or lack thereof, but I can’t get it quite right.
Let me put it this way: Do you really expect to get the advice of an experienced and hardworking agent for a fraction of what they usually charge? I know I will never sign up to work with Clever and I do not expect big time agents to do so.
I think many of these startups will crumble in the next few years. The DOJ could even prevent them from claiming their services are 100% free. Remember, you, as a consumer, have value.
If I were looking to buy or sell real estate, I would want my agent to be paid as much as possible. Ask yourself this: How hard will an agent work for you if they are only getting paid a fraction of what their firm usually charges?
Please check out my guide that explains how to find a local real estate agent. And if you still aren’t convinced, take a look at this article (Are the “We Buy Houses” Billboards Legitimate?).