Online real estate broker Redfin is revamping its website to add recent data and photos of recent home sales as well as links to blog discussions of a listing. The Seattle-based startup, which is profitable, represents buyers and sellers in home real estate transactions for far less than the industry rates that take 5%-6% of the sale price of a home and split it between buy and sell brokers. On the buy side they reimburse 50% of the fee they receive back to the buyer. On the sell side they charge a $5,000 – $7,000 flat fee. The normal broker fees on a million dollar house are up to $60,000, so the savings for the consumer can be significant.
With the addition of 9.6 million photos for 1.4 million recent property sales, the total amount of data and photos stored by Redfin has increased by 340%, empowering consumers with more information about the homes they are considering buying. With the upgrade, Redfin users can access sales information of properties within 15 minutes of the property’s being taken off the market, including the photos used to sell the property, and information about the properties’ amenities. Redfin mashes this info up with public records, giving the prospective home buyer greater insight into the history of a property.
The new version of Redfin’s site now also automatically links web pages about a property to blog posts about that property. For registered users, Redfin shows a link to the blog post with the post’s title and a brief summary; for unregistered users, Redfin shows a link to the blog post but doesn’t display the title or the summary. And Redfin launched a new version of its iPhone application that includes improved search filters on the year a house was built, lot size and days on market as well as the ability to exclude short sales and properties under contract from search results.
The ability to publish recent sales data and to incorporate blog links into the site are the result of a settlement that took place last year between the National Association of Realtors and the Department of Justice, that allows online brokers to publish the same information to the web that a real estate agent can share with his client, which was a huge win for the online real estate industry.
Redfin has been a disruptive technology to the real estate industry and has received backlash from the real estate professionals who are made unnecessary by Redfin’s model. The company’s CEO and founder Glenn Kelman told us recently, they’ve had to deal with “threats, stalkings and other disturbing behavior towards their employees and some customers from, apparently, angry real estate professionals.” And as Redfin adds additional information to its site, that real estate agents used to have a hold over, the platform is invading deeper into traditional brokers’ territory.
Since when does Redfin’s model make real estate agents unnecessary? Redfin’s model is that they want you to use their real estate agents and charge you less for doing so. Nowhere in their current business model do they do away with agents, otherwise they wouldn’t be continually expanding their footprint of agents nationwide.
I suspect that this business model will expand in the near future. Especially as the market heats back up. Kudos on the well written post.
I know that Redfin had a profitable month a while back (so did GM). Are they still having profitable months?
Also, as stated in a comment above, Redfin is a discount real estate brokerage with an awesome website – but they do have low-cost, salaried real estate agents working for them.
The one thing you have to look at – If a good real estate agent can make “$60k” on a single listing (as stated above), why would they work for less? To be totally honest here, there is only one answer that makes sense.
Hi Dave,
We’re still having profitable months and are continuing to hire many more agents. In terms of what our agents make, they do quite well, making much more than the industry average. In addition they enjoy health benefits, vacations and we cover a number of their other costs as well.
Matt
I like like their site but I feel sites like http://www.homeonthetube.com show more where the real estate industry is going.
Redfin is the most notable of many real estate startups aiming to make the traditional real estate agents obsolete. The idea that you need to give away 6% of the value of your home when you sell it became de rigeur long ago, and companies like Redfin are a win for everyone – except traditional real estate agents of course.
[Shameless plug - They only need to start including better images and high quality panoramic tours
to make those houses sell even faster!]
Kudos to Redfin for adding trackbacks from blog posts — anything from snarky to sweet — to listings!
However, being able to see the closed-sales price, data and photographs isn’t new. Sawbuck (www.sawbuck.com) has been providing this data in the Washington, D.C. and Baltimore areas since January 2008; and more recently in the greater Dallas, Los Angeles, Orange County and San Diego areas. More to come by year-end.
Sawbuck also shows when a property is under contract. So, if you’ve been watching a home to see if the prices drops and it suddenly disappears you can check to see if a property is under contract (and for how many days) or if it was just taken off the market.
Redfin Site ain’t looking too hot right now!
here is my view:
http://i145.pho...ad/Picture3.png
Sorry about that Sven. We had a problem with our upgrade today. Everything should be back online now.
Sweet. Redfin is great, stop using agents people! Unless you are buying a shortsale or foreclosed home, you don’t really need one.
Blogs will be good. Love to hear from neighbors or anonymous agents about the property.