Why Do Real Estate Agents Buy Houses at Lower Prices? Cherry Picking or Bargaining Power

Purpose The purpose of this paper is to explain why some real estate companies choose to have a vertically integrated structure, instead of specializing in only stage of the production chain. Design/methodology/approach The first stage of the research was an extensive literature review to generate hypotheses. A case study method was then chosen, as more detailed knowledge about the companies were judged to be needed to evaluate the different hypothesis. Documents about the companies were studied and interviews carried out. Findings In the studies cases, there is no support for theories related to vertical integration as a way to monopolize a market and only marginal support for theories that focus on contracting problems related to the so called hold up problem. The most important factors for the companies were that vertical integration gives information and more options that are important in small number bargaining situations. The companies bargaining power increases when they are better informed about, e.g. costs and profits in nearby activities, and when they can use in-house units, if there are problems to find reasonable conditions on the outside market. Research limitations/implications The main limitation is that only three cases were studied. Practical/implications The study can be helpful both to companies that choose to integrate vertically and those that chose not to. There are similar problems related to information and bargaining power that needs to be handled. Originality/value This is the first study that test theories about vertical integration in the real estate sector.

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Development of real estate marketing – trends for the future

Marketing Science & Inspirations ◽

10.46286/msi.2021.16.4.2 ◽

2021 ◽

Vol 16 (4) ◽

pp. 10-19

Author(s):

Jörg Petermann

Keyword(s):

Real Estate ◽

Digital Technologies ◽

Marketing Channels ◽

The Past ◽

Online Platforms ◽

Real Estate Marketing ◽

The Future ◽

Real Estate Agents ◽

Digital Channels ◽

International Sales

Real estate marketing has changed fundamentally over the past twenty years, mainly due to digital technologies. Due to the availability of online platforms as intermediary websites, the complexity of interaction relationships between providers, demanders, and real estate agents has increased. The study takes the perspective of real estate agents and uses the example market of Cologne/Bergisch-Gladbach to show what new potential digital channels offer for the reach and intensity of real estate marketing. Real estate agencies are challenged to evolve technologically, but then have a wider inventory of marketing channels and presentation options at their disposal. In the future, social media and video streaming platforms could further revolutionize property marketing, offering further potential to proactive providers, especially in terms of property branding and international sales.

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‘I Blame House Hunters’: How real estate agents use property TV to manage clients and establish expertise

Continuum ◽

10.1080/10304312.2021.1992351 ◽

2021 ◽

pp. 1-14

Author(s):

Kelcie Vercel

Keyword(s):

Real Estate ◽

Real Estate Agents

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Differentiated Disintegration: Brexit

Ever Looser Union? ◽

10.1093/oso/9780198854333.003.0009 ◽

2020 ◽

pp. 137-155

Author(s):

Frank Schimmelfennig ◽

Thomas Winzen

Keyword(s):

Bargaining Power ◽

Status Quo ◽

Common Interest ◽

Economic Interdependence ◽

British Government ◽

Eu Membership ◽

The Status ◽

Cherry Picking ◽

The Eu

This chapter examines negotiations on differentiated disintegration in the case of Brexit. It includes the efforts of the British government to renegotiate its EU membership prior to the referendum in June 2016 and the subsequent negotiations of the Withdrawal Agreement. The chapter shows that the same factors that explain demand for differentiated integration can also explain demand for differentiated disintegration. However, the supply conditions differ fundamentally. In disintegration negotiations, the EU enjoys the superior institutional bargaining power of the status quo-oriented actor, the superior material bargaining power produced by starkly asymmetrical economic interdependence, and the coherence and unity bestowed by supranational procedures and a common interest in preventing and deterring cherry-picking behaviour.

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