Side is a new and a potentially misleading proposition for California consumers. Side is a licensed real estate broker in California, but it does not help consumers to buy homes or list homes for sale. Side claims to work with top-producing, growth-focused partner agents where the "brand of the agent or team is front-and-center."
Side revenue comes from an undisclosed percentage cut of customers' commissions with participating partner agents. There are no upfront costs for partner agents to use the brokerage.
Side claims to offer brokers a "white-label" marketing solution, but in the background, Side works as the broker of record and earns a percentage of customers' commissions. Side says that this is a winning value proposition that is attracting top agents and teams at an accelerating pace.
The problem with Side proposition is a perplexing relationship between a marketing "while-label" platform and a licensed brokerage.
For instance, a licensed broker Anthony Paul Marguleas who operates under DRE 01173073 associates themselves with a Corporation where he represents consumers, APM Enterprises Inc. (DBA Amalfi Estates) licensed as DRE 01264346. At the same time, Anthony is also listed as a Broker Associate for Side, licensed as DRE 02014153 (as of November, 2019.)
According to Anthony's web site, "Anthony Marguleas is the owner of Amalfi Estates, one of Los Angeles' leading independent real estate companies, providing exclusive representation to both buyers and sellers." This agent never technically lists homes as a Side brokerage, or truly represents consumers on behalf of Side, yet the company associates itself as DBA Amalfi Estates. The question stands, which brokerage does business as Amalfi Estates – the Side, Inc. or the APM Enterprises Inc.?
Side, in effect, is a marking scheme for real estate agents looking to preserve the appearance of an independent brokerage, and at the same time, pooling resources into a single "background" brokerage. Side brokerage earns a percentage of customers' commissions from a pool of independent partner agents, and then uses this revenue to benefit the entire pool of partner brokers in aggregate. Such pooling of revenue can yield more effective returns from ads and marketing products, but it also functions as a reverse completion mechanism.
When contacted, Side specifically stated that it does not list homes or represent buyers in real estate transactions. Instead, the company offered to perform a match with a partner agent.
Side California license record currently displays records for 429 Salespersons affiliated with the brokerage (as of November 2019.) If Slide does not help to list or to buy homes, what exactly are these licensed Salespersons selling on behalf of Side?
On their web site, Side does not list their brokerage license, neither does it mention all DBA affiliations listed under their license record.
In their web site Terms of Service, Side claims that it "offers a technology service and platform via the Services that provides real estate agents and other real estate professionals," yet Side is clearly licensed as a broker, "acts" as a broker, and it asserts to the California Department of Real Estate that it works with legitimate broker associates.
Side claims that their "affiliated" agents will "sell your home for more money and faster." These are self-proclaimed and highly subjective statements. Such claims are a potential violation of the California Unfair Competition Law.
Consumers who are looking to work with independent agents to help them buy or sell homes often want to avoid paying high broker-to-broker commission splits.
With Side, consumers may be misled to think that they are working with an independent agent, while Side operates on the background as a true broker of record.
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