It’s hard to disrupt the traditional real estate business model, but Patrick Armstrong, CEO of Toronto-based proptech company Hyyve, hopes his new online platform will do just that because it will be real estate agents entering a bidding war, not homeowners.
On Hyyve, homeowners post property listings and real estate agents bid for the opportunity to represent them.
Hyyve aims to give listings agents a broader client base and educate homeowners on the value listing agents bring in the home sale process. The platform had a “soft launch” in the fall, with several hundreds agents already registered in the Toronto-area. The site hasn’t gone live, as Armstrong is still building up a bigger list of agents before the bidding process can begin. He expects to accept homeowner listings by the end of the first quarter of 2025 in time for the spring market.
“In real estate the listing itself is where the value starts,” said Armstrong, who has founded seven companies, including Snaile Inc., a parcel locker company, of which he was also its former CEO. “Without the listing the agent can’t sell or market your house. We want to take the listing and assign it monetary value for homeowners to benefit.”
Agents must subscribe to the Hyyve platform where homeowners post their listing along with details, videos and photos of the property, then agents put in competitive offers to represent the listing that include upfront payments (which come out of the real estate agents’ pockets) and service packages that can include staging, painting and marketing options.
Homeowners then choose the best bid based on the financial compensation and expertise of the realtor.
When a bid is accepted, Hyyve holds the money offered by the listing agent in escrow — meaning Hyyve holds the money until certain conditions are met — then takes a 30 per cent commission from it, giving the rest directly to the homeowners.
“We don’t transfer the money right away because we need to make sure the offer is legitimate and that there aren’t scammers,” Armstrong said.
If the agent bids $1,000, the company would take $300 and the homeowner would get the remaining $700. Even if the property doesn’t sell, the homeowner is able to keep the payment.
Hyyve facilitates the execution of the standard listing agreement via digital signatures, but doesn’t interfere on the terms of the agreement, Armstrong said.
For home sellers struggling with affordability, Armstrong said the bid puts money in their pocket up front, and even if the home doesn’t sell.
“This is aimed for buyers in their 30s and 40s who are moving up, maybe they’ve been sitting in their condo too long and want to move to that semi-detached in Leslieville, and this can give them the money to help with the land transfer tax, lawyers fees; it’s valuable to them.”
The Real Estate Council of Ontario (RECO), which regulates real estate professionals and brokerages in the province, said Hyyve isn’t a brokerage, but a business to support a seller in selecting a brokerage, and sellers should do their due diligence to find the brokerage that will best represent their interests in the sale of their property.
“Sellers should consider the fees the brokerage charges, and have a lawyer review the seller representation agreement before signing it,” Joseph Richer, registrar at RECO, said in an email to the Star.
“Sellers should understand the brokerage’s strategy to sell the property and understand what the brokerage expects of the seller.”
Christopher Alexander, president of Re/Max Canada, says the platform could be complementary to the real estate market, but likely not a disrupter.
Typically, homeowners like to use agents they’ve worked with before or get referrals from friends and family. But if the seller doesn’t have those connections, they could find the platform useful and find an agent quicker. It allows the seller to get a better understanding of the value of an agent’s negotiating and marketing skills in the home sale process — which is beneficial for both agents and sellers, he said.
“Consumers often don’t know the value of what an agent does and when you work with a professional it’s of big value to you,” Alexander said. “It will take savvy consumers to pick an agent based on their value over price.”
Armstrong says the company wants to target about 10 per cent of listings in the market and hopes the platform grows through word-of-mouth and networking.
“This platform is supporting the real estate agent, we’re not their competitor,” he said. “We’re championing the value they bring.”
