From 1996 to 2007, I founded, operated, and ultimately sold an online stock, futures, and options brokerage during a period of extraordinary automation in financial markets. Consumers benefited enormously as technology made trading faster, more accessible, and dramatically less expensive. So why, nearly 20 years after I entered real estate, have traditional commission structures remained largely unchanged—and why are we now seeing more efforts to restrict access to property listings?
By Rob Luecke Sr. | Founder, ShopProp Realty
I Watched Automation Transform One Industry. I Thought Real Estate Would Be Next.
In 1996, I founded an online brokerage firm specializing in stocks, futures, and options.
Over the following 11 years, I had a front-row seat to one of the most significant transformations in the financial markets.
Trading was moving away from expensive, labor-intensive processes toward electronic execution, automated systems, and increasingly direct market access.
The results for consumers were extraordinary.
Trading commissions declined dramatically. Access to financial information expanded. Transactions that previously required human intermediaries could increasingly be executed electronically in seconds.
Consumers became some of the biggest beneficiaries of that transformation.
In 2007, my company, RML Integrity Trading, was acquired by Lightspeed Financial.
Having spent more than a decade operating a brokerage during that technological revolution, I started looking at other industries where the same principles could apply.
Real estate seemed like an obvious opportunity.
Here was an industry handling enormous financial transactions, yet much of the process still depended on telephone calls, emails, paperwork, and people manually passing information between one another.
And commissions were generally based on the price of the property rather than the amount of work performed.
I thought, if technology could transform financial trading, why couldn't it do the same for buying and selling homes?
That question led me to start ShopProp in 2007.
I believed technology could make real estate transactions substantially more efficient, lower the cost of professional representation, and allow buyers and sellers to keep more of their money.
Frankly, I thought the transformation would happen relatively quickly.
Nearly 20 years later, I've learned that developing technology may be the easy part. Getting an entire industry to embrace it is something else altogether.
Nearly 20 Years Later, Why Are Real Estate Commissions Still So High?
Here's what I find particularly remarkable.
In May 2025, Redfin published an analysis showing that buyer-agent commissions had changed very little following the National Association of Realtors settlement and subsequent changes to commission practices.
The average buyer-agent commission was 2.40% in the first quarter of 2025, compared with 2.43% in the first quarter of 2024.
That's a difference of just 0.03 percentage points.
For homes selling for $1 million or more, the average was 2.17% in the first quarter of 2025.
Now consider what those percentages mean.
At 2.40%, the buyer-agent commission alone would be:
- $24,000 on a $1 million home.
- $48,000 on a $2 million home.
- $72,000 on a $3 million home.
These are illustrative calculations, not the average rates for each price tier. Commissions are negotiable, and actual compensation varies.
But the larger question remains.
Does buying or selling a $3 million home necessarily require three times as much work as a $1 million home?
Sometimes a more expensive transaction is more complex.
Sometimes it isn't.
But the amount of work is certainly not automatically proportional to the sale price.
In the financial markets, automation helped fundamentally change transaction pricing. In real estate, percentage-based commissions remain deeply embedded in the business model.
Redfin's research also acknowledges that commission rates have declined gradually over a longer period. But the dramatic reduction in costs I witnessed in financial trading has not occurred to the same extent in residential brokerage.
Why?
I believe a major part of the answer lies in the economic incentives of the firms and agents benefiting from the existing commission structure.
Imagine If Every Brokerage Could Communicate Through One Unified Platform
Think about how a real estate transaction could work.
A seller lists a property. Relevant property information, disclosures, and showing availability become securely accessible to authorized buyers and their representatives.
A buyer requests a showing electronically.
The appointment is coordinated automatically.
The buyer has a question about the property, and that question is routed to the appropriate party.
The buyer decides to submit an offer.
The system prepares the appropriate documents, organizes the information, and routes the offer to the seller.
The seller can review, accept, reject, or counter.
When the property goes under contract, the system tracks inspections, financing, contingencies, title, escrow, and closing deadlines.
Buyers, sellers, agents, brokers, escrow companies, lenders, and authorized AI assistants could communicate through systems that work together.
And whenever professional judgment is necessary, a qualified professional becomes involved.
None of this requires every brokerage to use the same company's software.
It requires common standards that allow different systems to communicate securely and reliably.
That's largely how the financial markets evolved.
Different brokerage firms, exchanges, and financial institutions developed the ability to transact through interoperable electronic systems.
Real estate needs something similar.
The objective isn't to eliminate every professional. It's to eliminate unnecessary work that adds cost without adding value.
So why hasn't it happened?
Why Are We Still Making Phone Calls Just to Get Property Disclosures?
Here's one of the simplest examples of the inefficiencies we encounter at ShopProp.
A buyer finds a property and wants to review the disclosures.
You would think obtaining those documents would be straightforward.
Sometimes it is.
Other times we send an email, follow up, call the listing agent, leave a message, and then follow up again.
Some agents want to speak with someone before releasing documents. Others request information or acknowledgments that could often be handled electronically.
There can certainly be legitimate reasons to verify someone's identity or determine whether they are authorized to access particular documents.
But why couldn't that verification happen through a secure electronic system?
A properly designed platform could authenticate the requester, establish document permissions, and provide the information immediately.
Instead, we're often still relying on telephone calls and manual follow-up.
Why?
I suspect some agents want to qualify prospective buyers, gather information, or maintain control over the flow of information.
Sometimes that interaction has value.
But when the interaction accomplishes nothing that couldn't have been handled electronically, it's simply another unnecessary step.
Now multiply those steps across millions of transactions.
How many hours are being wasted because our systems don't communicate with one another?
And this is just one example.
Every Brokerage Has Its Own Rules
Real estate is extraordinarily fragmented.
Each state has different laws, contracts, disclosures, and transaction procedures.
Within those states, individual brokerages establish their own policies. Then individual agents develop their own preferences about how documents should be prepared, signed, delivered, or acknowledged.
We've encountered agents requesting that buyers initial every page of an inspection report or execute additional acknowledgments that aren't necessarily required by the applicable agreement.
Sometimes we accommodate those requests simply to keep the transaction moving.
Now imagine building an automated system around thousands of variations in how people perform essentially the same task.
At ShopProp, we've developed technology that automatically associates communications with the appropriate client and transaction.
For example, when another agent responds to the original transaction email, our system can organize that communication and make it available directly to the appropriate client.
That reduces unnecessary forwarding, saves time, and keeps everyone informed.
But even getting people to reply to the correct email thread can be difficult.
They may start a new conversation, send the information somewhere else, or simply make a phone call.
None of those actions is necessarily unreasonable individually.
But repeated throughout thousands of transactions, they create an enormous amount of unnecessary work.
The technology can automate the process, but it cannot force every other participant to follow the same workflow.
That is one of the fundamental challenges of modernizing real estate.
Private Listings and Proprietary Marketplaces: Are We Moving Backward?
Perhaps one of the most concerning developments in real estate is the growing emphasis on private listings, office exclusives, and proprietary listing marketplaces.
Think about that for a moment.
For decades, technology has been making information more accessible.
In financial markets, electronic trading and improved connectivity expanded access, increased competition, and helped reduce transaction costs.
Yet in real estate, some companies are developing strategies built around keeping property information within their own networks.
Instead of opening the market, we risk creating new barriers.
To be clear, some sellers have perfectly legitimate reasons to keep their properties private.
Privacy, personal security, sensitive circumstances, or the desire for discretion may make a private sale appropriate.
I fully support a seller's right to make that decision.
But there's a substantial difference between a seller independently choosing privacy and a brokerage making restricted access a central part of its business strategy.
Consider the implications.
If a brokerage controls a meaningful inventory of properties available primarily through its network, buyers may feel pressure to work with that brokerage simply to access those homes.
Sellers may be told that the brokerage's exclusive network offers an advantage over the broader market.
And competing brokerages, independent technology companies, and consumers may have less access to information.
Instead of using technology to remove barriers, we risk using technology to build new ones around access to property listings.
In March 2025, the National Association of Realtors introduced its Multiple Listing Options for Sellers policy, including a delayed-marketing option.
These distinctions matter. Under that policy, delayed-marketing listings remain accessible to MLS participants while their broader public distribution may be postponed. Office-exclusive arrangements can be more restrictive.
NAR describes these options as expanding seller choice and requires documented seller consent for certain exemptions.
My concern isn't with genuine seller choice.
My concern is whether the expansion of private listing networks may increasingly serve the interests of the companies controlling those networks rather than those of the consumer.
Why would a large brokerage want to restrict property information?
In my opinion, one possible motivation is to protect the client relationship, maintain control over inventory, and preserve opportunities to collect commissions. That is an economic incentive worth examining.
And it raises an important question.
Are we building a more efficient marketplace for buyers and sellers, or creating new gatekeepers that make consumers increasingly dependent on established firms?
Source: National Association of Realtors — Multiple Listing Options for Sellers, March 25, 2025
Why Don't Consumers Push Back?
You might reasonably wonder why buyers and sellers don't simply reject practices that limit access to information or increase transaction costs.
After nearly 20 years in real estate, I think the answer is more complicated than it initially appears.
Most consumers are focused on one thing.
For sellers, it's selling their home for the highest possible net proceeds.
For buyers, it's securing the property they want under acceptable terms.
Everything else becomes secondary.
A buyer may dislike the idea of a private listing network, but if the home they want is available through that network, are they really going to refuse to participate?
Probably not.
A seller may dislike high commissions, but if they believe a particular brokerage will sell their home for more money, they're often willing to pay.
And I don't fault consumers for that.
A home purchase or sale may be one of the largest financial transactions of their lives.
They're not interested in risking their financial future to make a statement about industry reform.
Consumers may want the industry to change, but they don't want their own transaction to become the experiment.
This creates a powerful advantage for established business models.
Consumers may dislike the system, but when they believe their transaction depends on participating in it, many will comply.
And companies benefiting from the existing system have little reason to believe consumers will collectively reject it.
The Illusion of the Better Agent
There's something else I've observed over thousands of transactions that I think deserves much more attention.
We've had consumers come to ShopProp after working unsuccessfully with another brokerage.
Maybe their home didn't sell.
Maybe they submitted offers without success.
They switch to ShopProp, complete their transaction, and often save a significant amount of money.
They're thrilled.
Naturally, they may conclude that ShopProp accomplished something their previous agent couldn't.
But did we?
Sometimes, perhaps.
Maybe our team provided better advice, improved the pricing strategy, communicated more effectively, or negotiated a better agreement.
But in many cases, the explanation may be much simpler.
The market changed.
The asking price came down.
A seller became more motivated.
Interest rates shifted.
Competition declined.
A new buyer appeared.
Or the timing simply worked out differently.
We happened to be representing the client when the transaction succeeded.
That doesn't automatically mean we were better than the previous agent.
And here's where I think it's important to be equally honest about the reverse situation.
We've also had clients leave ShopProp and move to another brokerage.
Some of those consumers subsequently completed successful transactions, sometimes paying substantially more in commissions.
Naturally, they may attribute that success to their new agent.
But did the new agent actually do something different?
Sometimes, certainly.
There are excellent agents who bring real value to complicated transactions.
But sometimes the same external factors are responsible.
The price changed. The market shifted. A property became available. A seller accepted terms they previously rejected.
And because the consumer succeeded with the second brokerage, that brokerage receives credit.
We naturally credit the agent who gets us across the finish line, even when the finish line may have moved closer for reasons that had nothing to do with the agent.
I'm not suggesting agents never make a difference.
Of course they do. I'm saying that measuring how much difference a particular agent made is extremely difficult.
Why Real Estate Is So Different From Financial Trading
In financial markets, investors can often compare execution prices, transaction costs, and other measurable outcomes.
Those measurements aren't perfect, but standardized market data makes many comparisons possible.
Real estate is fundamentally different.
You cannot sell the same home twice, at the same moment, in identical market conditions, using two competing brokers.
You cannot know with certainty whether another buyer's agent would have secured the property you purchased.
You cannot establish exactly what would have happened if you had chosen another brokerage.
So consumers rely heavily on individual experiences, recommendations, and anecdotes.
And those experiences are frequently influenced by factors outside the agent's control.
That makes it extraordinarily difficult to compare the actual economic value of brokerage services.
Now combine that uncertainty with restricted listing information, fragmented systems, and percentage-based commissions.
It's not difficult to see why the traditional model has proven so resilient.
The consumer often has no reliable way to determine whether paying more actually resulted in a better outcome.
And when consumers cannot measure that difference, established brands, relationships, and perceptions of expertise become especially powerful.
Are Major Brokerages Financially Incentivized to Resist Automation?
I believe they often are.
If a business generates substantial revenue from a particular way of doing things, what incentive does it have to embrace technology that could dramatically reduce that revenue?
Automation could reduce the amount of routine brokerage work required in many transactions.
That should create opportunities for lower fees.
But it can also threaten business models built around traditional commissions.
I don't believe every agent deliberately obstructs automation.
Many agents embrace technology and genuinely want to improve the transaction experience.
And some obstacles exist for legitimate reasons involving legal compliance, consumer protection, privacy, or security.
But I believe the financial incentives help explain why change has been so difficult.
Some established participants benefit from controlling customer relationships, limiting access to information, or preserving processes that require intermediary involvement.
Not every restriction is designed to protect commissions. But the business incentives are real, and consumers should be willing to question them.
I saw financial services go through its own resistance to change.
The difference was that electronic trading eventually created extraordinary competitive pressure to become more efficient.
Firms that embraced technology could execute transactions faster and at lower cost.
Consumers could increasingly compare alternatives.
And the industry adapted.
The question is whether real estate will experience that same competitive pressure—or whether new private marketplaces and fragmented systems will continue slowing its evolution.
Will AI Replace Real Estate Agents?
I believe AI will automate a substantial amount of the routine work currently performed by agents.
Property research, scheduling, disclosure organization, document preparation, communication, transaction tracking, and deadline monitoring can all become significantly more automated.
But there's a difference between automating routine tasks and replacing professional judgment.
Complicated inspections, financing issues, title problems, difficult negotiations, and contract disputes may require experienced professionals.
Technology should help identify those issues and connect consumers with qualified assistance.
What it shouldn't do is force consumers to pay thousands of dollars simply because information must be manually relayed between people and disconnected systems.
The future may not be a world without real estate professionals. It may be a world where consumers choose the professional assistance they need, when they need it, at transparent prices.
The objective isn't to eliminate expertise. It's to eliminate unnecessary costs and inefficiencies.
Could Buying and Selling a Home Eventually Be Free?
I believe much of the routine brokerage process could eventually be offered at little or no direct cost to consumers.
Look at what happened to stock trading commissions.
As technology improved and competition intensified, transaction costs declined dramatically. New business models emerged that allowed consumers to access services that previously carried substantial fees.
Why couldn't real estate follow a similar path?
At ShopProp, we've already taken steps in this direction.
We offer a commission-free MLS listing option for sellers who prefer to handle much of the process themselves, subject to the program's terms.
We also offer flat-fee representation for consumers who want professional support.
Our goal is to give buyers and sellers more control over what services they purchase and what they pay.
I can envision a future where routine brokerage services are essentially free to consumers, supported by alternative business models and optional professional services.
That doesn't mean every cost associated with a real estate transaction disappears.
Title, escrow, inspections, financing, taxes, and other legitimate expenses remain.
And specialized professional expertise will always have value.
But the traditional percentage-based brokerage commission doesn't need to remain the default method of paying for every service.
Consumers should pay for the value delivered, not the inefficiencies of the system providing it.
The Industry Needs Interoperability, Not Another Closed Platform
There is already meaningful work being done to standardize real estate information.
The Real Estate Standards Organization, or RESO, has developed standards such as the RESO Web API that help different systems exchange real estate data.
That's important progress.
But sharing listing data is only part of the transaction.
What happens after a consumer finds a home?
Showing requests, disclosure requests, offers, counteroffers, contingency negotiations, inspections, financing, and closing procedures still frequently involve disconnected systems and incompatible workflows.
That's where the next major opportunity exists.
I don't believe the answer is to force everyone into one company's proprietary ecosystem.
I believe the answer is to establish common standards so that different companies can build competing services that communicate with one another.
A buyer should be able to use the technology they prefer.
A seller should be able to choose the brokerage and representation model they want.
And those choices shouldn't create unnecessary barriers to exchanging information or completing a transaction.
That's how modern electronic markets operate.
We don't need one company controlling real estate. We need an industry where different systems can work together.
Source: Real Estate Standards Organization — RESO Web API
What Nearly 20 Years at ShopProp Have Taught Me
Since founding ShopProp in 2007, we've represented buyers and sellers through thousands of transactions and helped consumers save substantial amounts of money.
We've also learned firsthand just how difficult it is to modernize an industry built around fragmented rules, disconnected technology, and established business practices.
And we're not perfect.
There are areas where our technology, communication, and service can improve.
That's our responsibility.
The industry's inefficiencies don't excuse shortcomings within our own company.
Our clients deserve accurate documents, reliable systems, responsive communication, and experienced professional guidance regardless of what they pay.
The goal isn't to provide less service because we charge less.
The goal is to use technology to provide better service at a lower cost. That's what drew me to electronic trading almost 30 years ago.
And it's the principle behind ShopProp today.
So How Do You Automate Real Estate When the Biggest Players Fight Automation to Protect Their Commissions?
I believe the answer begins with recognizing that technology alone isn't enough.
We need common standards that allow different brokerages and platforms to communicate.
We need greater transparency about brokerage compensation and the value of services being provided.
We need consumers to have broad, fair access to property information when sellers choose public marketing.
And we need continued competition from companies willing to challenge the traditional commission model.
Most importantly, we need to recognize that the interests of the companies controlling transactions are not always perfectly aligned with the interests of the people buying and selling homes.
When I left financial services in 2007, I thought real estate would experience a similar transformation relatively quickly.
I was wrong about the timeline.
But I don't believe I was wrong about the opportunity.
The technology to automate much of the transaction process already exists.
AI will make it even more powerful.
What remains is the challenge of getting independent participants to operate through systems that prioritize efficiency, transparency, and consumer choice.
And that's why I find the growing emphasis on closed marketplaces particularly concerning.
At a time when technology could make property information more accessible and transactions more efficient, we should be moving toward greater openness—not creating new barriers around the information consumers need.
Financial markets became more efficient as technology improved connectivity and competition.
Real estate should be moving in the same direction.
The biggest breakthrough in real estate won't simply be another listing website or a smarter AI assistant. It will be the day that buyers, sellers, brokerages, and their authorized technology can communicate and transact through shared standards without unnecessary barriers.
That's the industry I've been working toward since 2007.
And after nearly 20 years, I still believe it's possible.
The question is no longer whether we have the technology to automate much of real estate.
The question is whether the industry's biggest participants are willing to embrace automation when doing so could fundamentally change how much consumers pay them.
About the Author
Rob Luecke Sr. is the founder of ShopProp Realty, established in 2007 to provide technology-driven real estate representation and transparent flat-fee pricing.
Before founding ShopProp, Rob founded and operated RML Integrity Trading, an online brokerage specializing in stocks, futures, and options, from 1996 until its acquisition by Lightspeed Financial in 2007.
Through ShopProp, he continues to advocate for greater automation, more transparent pricing, and better consumer access to real estate services.
