Goodbye Foxtons: Foxtons Done In By Housing Slump

By
Real Estate Agent with License Currently On Hold Due To Market Conditions

 I have to admit I kind of did a little dance when the news of Foxtons demise hit. I am not proud of myself for it, but it is what it is. Anyway, nothing against the Foxton Employees. Notice I did not refer to them as Agents. I feel they are not anywhere near the level of myself and other Agents who do not practice undercutting! Ever since I began in Real Estate I have found it pretty fruitful to go after the Expired and Uncond. Withdrawn Foxtons as there are a great deal of them.

I guess my main qualm with the Foxton Employees is that I resent that they get to "play" Realtor while myself and the rest of us pavement pounders are working 50-60 hour weeks with no cushion of a paycheck sitting in the bank waiting for us. I know some  will say well Foxton Employees make much less than we Realtors do! This is probably true, but according to many of the previous customers of Foxtons that I later successfully assisted, they did not provide any where near the services of a Full Service brokerage. Also my biggest problem with the Foxtons of the world is that often they do not accurately input the listings. Many times information such as rooms would be omitted. There were a few that I later took over that according to the listing had no bathroom, nor kitchen. I was pretty sure one actually existed and of course it was proven upon taking over the listing. Point made!                                      

Foxtons Done In By Housing Slump By; Michael L. Diamond Business Writer Asbury Park Press 9/27/07

Foxtons, a West Long Branch - based real estate company that made a splash with its discounted commissions, said Wednesday night it is closing because of a downturn in the housing market. The company said it is contemplating bankruptcy for an orderly shutdown, and will continue only with a skeleton crew; it is laying off 350 of its 380 employees.

"The plain fact is that we have been battling against a real estate market that recently has turned into a sharp decline, and the company no longer has the liquidity to operate as a growing concern," said John D Blomquist Foxtons' Senior Vice President and General Counsel.

The decision marks the latest casualty in the softening real estate industry, and it brings a stunning end to a company that was a lightening rod among real estate agencies. It was founded in 1999 as YourHomeDirect.com by Glenn Cohen, a Shore area entrepeneur who was put off by having to pay 6 percent commission to a real estate agency when he sold his home.His idea: He would pay his employees a salary as opposed to a traditional agency, which pays agents a commission from the sale. In turn, consumers would pay a 2 percent commission.The company would win business through an intense marketing campaign that included agents driving around in purple and yellow PT Cruisers.

The business model, however, was unproven. Real Estate agents were unmotivated to show their buyers Foxtons homes, knowing the commission would not be much. Observers said what Foxtons lost in commissions it would have to make up in volume. "Their business model is based on sales volume, and in this market, you are not going to get the sales volume,"said Albert S. Veltri President and Chief Executive Officer of Veltri Real Estate Associates in Toms River. "With whatever little bit of volume you get with their reduced commissions and high overhead that they have,they were not going to make any money."

Cohen sold his company, which operated in New Jersey and New York state, to London-based Foxtons in 2004 after a tumultuous tenure. He was the target of two lawsuits from women who said he sexually harassed them. Those suits were settled out of court. Foxtons scrapped the business model, raised the commission, first to 3 percent, then to 4 percent and it pledged to offer consumers more services. It changed from PT Cruisers to mini Coopers. When Foxtons was sold in May to a private equity firm for what is said to be $770 million, its' North American operation was not part of the deal. Foxtons in a statement Wednesday night said it has 4400 current listings, and the intention will be to preserve the value of these listings, to minimize customer disruption and to dedicate the anticipated revenues to pay creditors."

For further info on how to successfully market your home or how to purchase a home at an affordable price,

contact: Sherri Bauer 908-334-7174 Prudential NJ Properties

"Don't Worry With Sherri"

Comments (5)

Anonymous
Ex Foxtons "AGENT"

I am an ex Foxtons employee who was terminated on 9/26.  I really must say I am not surprised by your ignorance and over-inflated view of your skills.  It is one thing to waste your time attacking the Foxtons business model, but to attack the AGENTS is downright wrong although typical of a so called "realtor" as yourself. 

Like all Real estate offices, Foxtons had its fare share of bad agents.  No more than what I have dealt with in all my experiences of working with other agencies.  I for one did not "play" realtor.  I was an overachiever who closed 84 homes in a 12 month period and a NJAR Circle of Excellence award winner!  I would love to know how many you closed in the last twelve months.  In fact, no other agency in all of NJ had as many Circle of Excellence winners as we had.  If any of us did slip with customer service, it was due to the workload that was forced on us.  You say you work 50-60 hours a week?  Try 70-80 hours a week.  You wouldnt have lasted one second with our typical work week.  I would love to see you have 30 hours of mandatory office time a week, go on 20+ listing appointments a week, take 3-9 listings a week, work on your 10-20 current deals that are about to close, and then manage and provide customer service for your existing inventory of 100-120 sellers. 

 Make much less?  You couldnt be more wrong.  We made as much and in most cases more than an above avg. agent in traditional real estate.  We only worked longer and harder to get there. 

Its no surprise that myself and most other Foxtons agents are having the problem of Brokers and Agencies throwing everything, including the kitchen sink at us in hopes us signing on to work for them!  The reason being that anyone who has a clue know how valuable most of us are.  I havent met one "traditional" agent who had the work ethic that was istilled in us.  Was the company bad, yes! its people, No way!

Its a testament to myself that within one week, I was signed on with a new broker and took along 35 sellers with me!  Do you think they came with me because my customer service was lacking? Think again!  You are clueless.  Whats your excuse going to be when ex-employees of Foxtons are selling circles around you?  I can only imagine..........

Some words of advise, keep your thoughts to yourself when taking on a subject in which you dont have a clue.  It makes you look dumber than you probably are, although judging by those curls and bangs, maybe not!

Oct 08, 2007 02:47 AM
#1
Anonymous
Oksana

Dear ex Foxtons agent. What a response! This is exactly the type of agent I would like to see working in our office. If you are located in South Jersey, I would like to invite you over to our office Open House party. Our company is run by the agents. The atmosphere alone is worth of checking it out. Please e-mail me if you wish to get an invite: kudina@comcast.net.

 

Oct 08, 2007 05:57 AM
#2
Anonymous
Anonymous
ok calm down did not mean to seem as if I was attacking the employees. I dont like the business model of foxtons. I also can show countless listings where inaccurate info was put into the system so that is why I said that customer service was often lacking. Especially since I heard it directly from the clients mouths. Glad you found another agency. Welcome to the world of Realtors. Who wants to be an employee when you can own your business? <smile>
Oct 08, 2007 06:42 AM
#3
Timothy Schwartz
Century 21 Mack Morris Iris Lurie - Marlboro Twp, NJ
Sherri, glad to see you joined C21.  Great choice, you are with the number one C21 in New Jersey..U can't go wrong there.  All the best to you.
Apr 29, 2008 03:03 PM
Laura T. Perry
Keller Williams Elite - Lancaster, PA
CRP, GMS, Award Winning Relocation Specialist

Stopping by to share our RELO message (no C21 in our market) -  http://actvra.in/4jHG

Jul 27, 2014 11:13 PM