Given how often I link to Redfin’s website, I thought readers might find this 60 Minutes special from 2007 fascinating. Click the image above to watch the video.
I actually think that Redfin’s prices will also come down as further battles are won against the National Association of Realtors and more online discounters enter the market.
Just realized today that Healdsburg is now in "redfin's area", the site had listed houses in Healdsburg for quite some time, but now appears that they have agents (or independent contractors) in Santa Rosa that can show houses and write offers for the area. I will be curious to see how the downturn effects Redfin. On the one hand, the money saving aspect will be more appealing. On the other hand, given the uncertanty of the market buyers may want to go more with local agents. I am personally in the second camp (will use local agents).
ReplyDeleteI agree, short-term it is possible that local agents will get more business.
ReplyDeleteBut in the long-run I don't see the model working. The internet is just too much of a game changer and agent fees are just too high.
Like one of the agents says in the video, there were times when her clients would find the house themselves on the internet and she would get paid $12,000 for four hours of work.
Same probably goes for lawyers (leagalzoom.com), brokers (etrade.com), money managers (ishares.com), etc.
I probably should clarify. I agree that long term Redfin will shrink margins and more people will use a web or hybrid model.
ReplyDeleteWhat I was referring to was my personal situation. In the video it looked like an individual got 2/3 of the 3% Redfin would get in a rebate. So on a 600K house that would be 12K. However, when I check online for a 600K house in Healdsburg, they would rebate 2,246. link: http://www.redfin.com/CA/Healdsburg/535-Monte-Vista-Ave-95448/home/2139402
Given this amount of money, I will pay for a local agent that can provide more service given the current marketplace.