I'm curious how many sellers have been using redfin as a broker and what their thoughts are on the process. Redfin went public this past year and is pushing to grow it's business. I'm a fan of their tech, and like the idea of only paying 1% commission. They have potential to be fairly disruptive in the business.
They have been around for 10 or 15 years already and they have not disrupted the industry yet. They are a great technology company, but a bad real estate company. (I wont bother getting into all their problems here) In fact Ive hypothesized that their actual goal is to get into every market then sell their company to a national brokerage, as their really value is in the webaite. As of right now they lose on average $3,000 per transaction and that is simply not sustainable.
@Derek Daun Obviously, I'm biased against the Redfin model. I'll admit that up front.
But here's a question - what kind of agents do you think are attracted to work at a discount brokerage like Redfin?
Top producers who will work themselves silly to get your home sold at the highest possible price, no matter what it takes?
Or an agent who prefers to get paid on salary, showings and open houses and a lower commission on actual sales - and therefore won't have his interests quite as aligned with yours?
A 100% commission agent is highly motivated to get your home sold as quickly as possible and at the highest possible price. Their interests are completely aligned with yours.
That said, it's your call!
@Charlie MacPherson Yeah, that makes sense, but to counter that, I'd say it sometimes takes more effort on the agents part to sell a cheap house compared to an expensive one. Overall, the entire percentage based model doesn't make sense, and is crudely adjusted incentive. Even more so when I know more about my neighborhoods than most realtors.
I'm actually not selling right now, and am more interested investigating stock positions in Redfin.
@Derek Daun I'd respectfully disagree. In Plymouth County (where I live) this past month, homes listed under $250,000 (low end) sold in an average of 45 days on market. Homes above $700,000 (high-ish end, but not the highest) sold with an average of 111 days on market.
Around here, selling a high end home takes a LOT more work.
Anything at the entry level price point in any town around here goes with multiple offers and well over asking price, but your market may be very different than mine.
The selling price isn't the point though. It's the quality of agent you'll get using a discount brokerage like Redfin, who pays their agents a base salary plus extra for activities like showings, open houses, etc.
They don't necessarily care whether they show you the RIGHT house as a buyer - they get paid either way.
They don't necessarily care whether buyers they take to see your home are qualified - they get paid either way.
They don't necessarily care how the open house goes - they get paid either way.
They don't necessarily care how whether they get the best possible offer for you - they get paid either way.
The bottom line is that it just makes more sense to pay people to accomplish what you want them to accomplish - and that's to sell your property at the highest possible price. Not just to do showings and open houses.
BTW - If you know more about your market than your realtor, you're using the wrong realtor.
@Charlie MacPherson I'm mainly referring to high cost of living areas like where I live and entry level is 450k in a premium neighborhood, and it's a sellers market. In most of the sales I see, the agent is not earning that 13k. It's a lot of money to pay someone to mis-price a house and stage it poorly.
I do understand what you're saying about 'you get what you pay for', but I think people are often getting that level of service anyway.
Also, I didn't say I know more than MY realtor, just more than a lot of the realtors I meet.