REX Real Estate is a one-of-a-kind player in the discount brokerage industry. Their AI-powered business model claims to eliminate buyer’s agent commissions, saving everyone 50% compared to a traditional real estate agent.
REX Real Estate currently operates in 16 states and Washington, D.C. They operate on a full-service model, including concierge services for a 2.5% listing fee, and claim not to charge buyer’s agent commission.
Although the discount is eye-catching, is there an ugly truth behind this discounted fee structure?
Read on to find out…
What is Rex Real Estate About?
Rex Real Estate is a multi-state real estate brokerage firm that provides buyers and sellers with listing discounts and rebates. Rex Real Estate neither offers buyer’s agents a split of the buyer’s agent commission which is typically between 2.5%-3% nor does it list seller’s homes on the MLS which is not so promising when buyers want more visibility for their listings.
What Makes It Different From Others?
A seller pays a commission fee of 5-6 % in a quintessential real estate transaction. Rex is unique in that it charges a total fee of 2.5 %.
While this may appear to be a mind-blowing deal, it excludes a buyer’s agent commission, which may be required if the buyer is not coming from Rex.
When your sell your home with Rex they do not list your home on any MLS, which is used by real estate agents all over the country to scout for and advertise homes to each other and their clients. Many buyers will not see a home listed by Rex because the MLS lists the vast majority of properties on the market.
Buyer’s agents are not rewarded to show their clients to Rex’s properties because they do not pay a buyer’s agent commission.
As a result a number of homes listed on Rex miss out on a large number of buyers by not being listed on the MLS or offering buyer’s agent commissions.
What’s The Catch?
Rex targets buyers who aren’t working with a traditional agent, eradicating the possibility for a buyer’s agent commission.
9 out of 10 home buyers use an agent to help them find a home, this can eliminate up to 90% of your potential buyers. With fewer potential buyers, selling your home can take longer and result in a lower sale price.
Now, what if a buyer with a real estate agent wants to buy your house?
In that case, Rex requires the buyer to pay their own commission to their agent, which is not standard practice or they could ask you to deduct the money from the purchase price.
This way or that, you’re the one who foots this bill!
In the case of a buyer coming to you with their own agent wanting to buy your house, the buyer is responsible for their own agent’s commission while in common practice is that the commission is paid by the selling agent which is in turn covered by the commission paid by the buying agent.
Where is Rex Operational?
Rex is active across 16 states such as AZ, CA, CO, DC, FL, GA, IL, MD, NV, NY, NJ, OR, PA, TX, VA, and WA.
The hottest news surrounding Res is that things have hit a rough patch resulting in them packing up their offices in 6 states, including New York and Illinois.
This just goes to show that Rex’s business model is a complete flop that does not provide enough value to customers, despite raising millions of dollars in investor capital.
What’s The Fee Structure?
Rex promotes a flat listing fee of 2.5 %, which “covers both sides of the transaction.” This implies that sellers will only pay this fee. That is true only if Rex is able to find an unrepresented buyer.
Bear in mind that Rex has a $9,000 minimum fee, despite the fact that it charges a %age-based commission. If your home sells for less than $360,000, you’ll have to pay an effective listing fee of more than 2.5%.
Pros and Cons of Rex Real Estate
You may save a lot
Rex’s model is risky, but if it succeeds, you’ll save a lot of money on realtor fees by skipping the buyer’s agent commission entirely. On a $1 million home, you could save up to $30,000 compared to paying a 3% commission to the buyer’s agent.
Rex Homes reviews are mixed, indicating that the company’s strategy does not always work. Savings, on the other hand, are a common theme among sellers who have received positive feedback.
Lucrative rebate commission for buyers
You may be eligible for a commission rebate of up to 1.5 % of the purchase price if you buy a non-REX home with a REX agent. These savings can be used to offset closing costs and other up-front costs associated with purchasing a home.
As opposed to some of its competitors, Rex provides in-person when you’re selling your home.
While numerous realtors use the power of technology to conduct real estate transactions from afar, there’s no substitute for having an agent present for critical tasks such as:
- Visiting your home to assist you in determining a reasonable list price
- Recommendations for improving the marketability of your home
- Organizing open houses for potential buyers
High failure rate
The biggest disadvantage of selling with Rex is the obnoxious strategy of finding buyers who aren’t represented by an agent resulting in a high failure rate. One recurring theme in negative Rex Homes reviews is that sellers expected to save money on realtor fees, but Rex failed to produce qualified buyers.
Forget about MLS listing
Since Rex is looking for unrepresented buyers, it will market your home directly to potential buyers. Rex advertises on various social media platforms and other websites instead of listing your home on the MLS.
However, hardly anyone would be interested in buying a property on Facebook or Instagram; the majority of serious buyers work with agents, and the MLS is the most important tool that buyers’ agents use to help their clients find homes!
Rex’s deceptive marketing tactics and combative attitude toward traditional real estate brokerages have earned it a bad reputation among traditional realtors in some parts of the United States.
Many agents, predictably, refuse to show buyers Rex listings that do not include a buyer’s agent commission. Furthermore, Rex’s poor reputation may have a negative impact on sellers even if they offer to pay the buyer’s agent’s fee.
What is Rex Real Estate Reviews Like?
Looking through Rex Real Estate reviews, you’ll notice positive mentions of Rex professionals who are responsive and knowledgeable, guiding clients through the home selling process.
Negative Rex Real Estate reviews, on the other hand, mention poor communication and a lack of interest from buyers, most likely due to a lack of exposure to the MLS. Some reviews also state that Rex tries to underprice homes in order to ensure that they sell.
Take a look for yourself…
While there are some good, positive reviews, most of these reviews speak volumes of their service and how dissatisfied customers really are.
Is Rex Apt For You?
For the majority of home sellers, we do not recommend REX Real Estate. Its approach to the real estate process is risky by nature, and it does not provide enough incentive for agents to show REX listings to prospective buyers.
Furthermore, Rex’s promise of savings does not tell the whole story. Most home sellers will end up paying the same as they would with a traditional agent — far more than they should for REX’s level of service and support.
Other discount real estate brands provide much more overall value, with guaranteed savings and hands-on service, whether you’re selling or buying a home. When you’re interviewing different real estate agents, keep in mind that you’re under no obligation to move forward or commit to a specific service. You have nothing to lose and everything to gain by comparing rates, experience, and personalities to find the best fit for you!
Are There Better Alternatives?
Sure there are…
These are our top picks.
Clever Real Estate
Clever Real Estate is one of the best REX alternatives if you want to save money without sacrificing service.
Clever try to negotiate discounted commission rates with traditional realtors across the United States in advance. Unlike Rex, Clever’s agent-matching service matches you with top-rated realtors in your area, who handle all selling responsibilities — including your MLS listing. You can also interview as many agents as you want with Clever until you find the one who is the best fit for you.
If you sell with one of Clever’s partner agents, you’ll pay a $3,000 listing fee (or 1% of the sale price) for homes under $350,000. Commission rebates may also be available to qualified buyers.
You have a lot of great options when it comes to saving some cash on real estate fees. If you’re still unsure where to begin, you can try Clever. More savings than REX, but with less risk
Houzeo is our top pick from the alternatives. Houzeo is not your typical MLS and FSBO service provider. It is one of the most sophisticated For Sale by Owner websites available and Houzeo reviews fare far better than Rex real estate reviews.
Once you’ve decided to list your home, the entire process goes smoothly—all necessary documents and listing paperwork are available online! Furthermore, there are no closing costs or listing agent commissions.
When compared to Houzeo’s pricing package—only $199 to begin listing—2.5 Rex’s % listing fee may appear unappealing. It’s even less than REX’s listing agent commission of 2.5 %. Furthermore, listing your property with Rex may be subject to a number of restrictions, and some states are not even available.
In addition, Houzeo provides an IntelliList Listing Management System. In some ways, it aids in the management of your listing details, allows you to sign your Listing Agreement online, and tracks the progress of your listing. Take a look at Houzeo reviews at some of the leading review websites and then decide to list your home if you’re looking for the most sophisticated Flat Fee MLS/FSBO platform with unlimited leverage and cutting-edge technology.