I sold my house with redfin on Dec 31 2007. The transaction was absolutely wonderful. It was a money loser for Redfin - first offer fell through due to misrepresentation by the purchaser, second one was complicated due to an extremely picky purchaser, and it took a total of about 60 hours of work by the Redfin agent to get the deal closed. It was an unusual case but the point is i've done about 4 other transactions and this was the most professional and hardest working agent and it was the cheapest... So they don't drop you if your transaction turns out to be a statistical outlier... HIGHLY recommended.
Summary of the article: Redfin reimburses 50% of the fee they receive back to the buyer. And Redfin charges the seller a $5,000 - $7,000 flat fee. In contrast when the buyer and the seller of a million dollar house use traditional Realtors, together the Realtors take about $50,000 or $60,000 of the transaction.<p>Finally, here is a comment from the Techcrunch article:<p><i>I was an active Realtor for 8 years and I’m glad to see something like this taking shape. It’s only a matter of time before real estate agents are entirely obsolete, and for good reason. You used to have to go through an agent to get this kind of information on homes; now the general public has access to that same information.</i>
I've been following redfin since their early days and was very excited by their business model. They were featured on 60 minutes about a 1-2 years ago too, which helped them gain some mainstream momentum.<p>The real estate industry, specifically residential real estate, is in the process of rebooting. A lot of the legwork that agents were doing in the past can now be accomplished by the buyer/seller and much of the information can be found on real estate aggregation sites. Not to say that residential agents will be extinct anytime soon (they still provide a service) but their commissions will definitely be affected.<p>Commercial/Industrial/Ag. real estate on the other hand, still requires professional agents, IMO. Specific knowledge (legal/zoning issues/environmental impact reports/etc. etc.) is needed in these areas to assist buyers/sellers.
The redfin UI needs to be massively cloned for location based services. Honestly, I love craigslist, but when I'm looking for houses to rent, I want to specify a polygon on a map. Maybe it's just me.
There are a few things the Internet is incredibly good at. Content delivery, communication and administrative services. If you're in any of these industries, don't expect your job to be around 10 years from now. It's time to evolve.
I was going to try to respond to a bunch of points people made here and on the Techcrunch site about the Redfin story, but unfortunately I didn't have the time to do individual responses while it was still a relatively active thread. So, instead, I'm going to just make a bitch list here now, in an attempt to start a new discussion. 'Cuz, you know, bitch lists are so productive ;-) Here is what I've started with, in roughly ascending order of pissed-off-edness:<p>4. I'm pissed at Redfin.<p>Redfin is not that innovative. I think Glenn is a good guy, and a fast learner, but there are better real estate brokerages out there. What do I mean by "better"? I mean companies that save the consumer even MORE money, offer BETTER customer service, don't cut corners or take advantage of OTHER professionals to save money, and have business models that better align their interests with the consumer. I think Redfin is a move in the right direction, but I'm sick of hearing about their "innovation." They're not doing anything other companies haven't already done - they're mainly just doing it more vocally. This all may come across as jealousy or sour grapes from a competitor. It is. I'm jealous because I have a better (and more profitable) venture-funded real estate company - but I can't shout it to the world like Redfin does, because I haven't figured out a way to scale our company while keeping our same quality of service. So I can't advertise or blog about it, and I have to turn customers away because we can't keep up with our current demand. Being the guy with a better widget who can't manufacture enough to meet demand may be a "nice problem to have", but it's extremely frustrating. At this point, I'm trying to avoid going down the "referral partners" path because that largely defeats some of our advantages. So, yeah, I'll have the sour grapes.
Given my last experience with a realtor, and hearing similar stories from others, I can't say I'm surprised that a website is doing a better job than a good number of them.<p>I'm not going to blanket stereotype, but when certain realtors are basically just setting up MLS feeds, and then forwarding matching listings to a client, how do they assume that someone couldn't program a site to do the same thing?