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Real estate site Redfin files for IPO

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Re: Real estate site Redfin files for IPO

#61

Post by jasode »

ferentchak wrote: post #25
toomuchtodo wrote: post #16

Earlier quoted context omitted.

"I'm still waiting for someone to completely eliminate the need for a software engineer and charge a reasonable flat fee to bolt together some libraries and handle all the related details. Why do we even need software engineers at this point? Everyone can find the libraries and open source tools they need online nowadays. Why does anyone need to pay a whopper paycheck to some middle-man?" You're paying for someone's…

I can see some of the expertise coming into play on the selling side. Can you give me a few examples of what kinds of value one gets while buying? From what I can tell the main service that my realtor offered when I buying my place was access to the MLS. We found the houses we wanted to look at and he gave us access. Dollars per hour he was doing very well working with me, although I might be an exception.

>Can you give me a few examples of what kinds of value one gets while buying?

If a buyer is unfamiliar with the area (e.g. job relocation), a competent agent can point out the desirable & the unpublicized undesirable aspects of particular neighborhoods. The agent knows the area intimately and that knowledge can be worth paying for to avoid buying the wrong house.

If I'm living in the same house for 20 years and I see a house right down the street from me go up sale that would be perfect for my elderly parents so I could keep an eye on them, I wouldn't need a buyer's agent since I would already know more about that house/neighborhood than any agent would.

Re: Real estate site Redfin files for IPO

#62

Post by opo »

ericb wrote: post #24
japhyr wrote: post #20

Earlier quoted context omitted.

I agree. I live in a small isolated town, and I thought realtors were artificially increasing the home prices (not values, but prices) in the small pool of housing available here. But their local knowledge was invaluable in both buying and selling a home. That said, if a buyer and seller agree on a sale independently of any realtor here, we can go to a local realtor and they'll happily facilitate the sale for a flat…

You don't need a realtor, fyi, just a good real estate lawyer, which you generally need anyway when buying/selling a house. A lot of the apparent value of realtors disappears when you do the process yourself. source: have FSBO bought, and FSBO sold, and redfin bought, and worked for Coldwell Banker. Getting on the MLS is cheap/easy now with discount MLS listings--I wouldn't do fsbo without it, even though you usually…

>You don't need a realtor, fyi, just a good real estate lawyer,

Lawyer prices will obviously be different in different parts of the country, (so maybe a lot cheaper where you are) but I knew someone who arranged a transaction without a realtor and paid a lawyer a lot more than $1,000 to put together all the necessary documents. One thousand seems like a good deal.

>...which you generally need anyway when buying/selling a house.

You've found it necessary to always consult a lawyer when buying/selling even though realtors were involved? Why? What value did they add?

Re: Real estate site Redfin files for IPO

#63

Post by notadoc »

jrs235 wrote: post #54
dublinben wrote: post #46

Earlier quoted context omitted.

That doesn't explain why they should earn a percentage of the purchase price, and not a flat fee.

They don't get paid unless there is a successful sale. Listing contracts are for a fixed period. There are marketing expenses and time invested to list and market a property. If they don't successfully sell your home they don't get paid and they are out any of their time invested and marketing expenses. High risk, high reward.

> There are marketing expenses and time invested to list and market a property

Putting a house on Zillow takes, what, 15 minutes?

Perhaps the exception is very high end real estate, but from what I've seen most of the high end realtors are just really good at networking and schmoozing.

Re: Real estate site Redfin files for IPO

#64

Post by anindha »

notadoc wrote: post #3

I'm still waiting for someone to completely eliminate the realtor and charge a reasonable flat fee ($1000?) to buy/sell a house and handle all the related details. Why do we need realtors at this point? Everyone finds houses themselves online nowadays. Why does anyone need to pay a whopper commission to some middle-man?

When I was young before the Internet, it was impossible to book overseas travel without a travel agent. As more and more information became available and presented in a user friendly manner booking travel online became the norm.

It will take much longer for the information required to buy or sell to become easily accessible over the Internet but I have no doubt this day will come.

Re: Real estate site Redfin files for IPO

#65

Post by deelowe »

Danihan wrote: post #33
bkjelden wrote: post #12

I hope this company sees nothing but success. I bought my house through Redfin last year, and not only did I save ~$5k in commissions compared to a conventional realtor, I also felt the process was much smoother and more pleasant than other times I've interacted with a conventional realtor. It's simply absurd that in an era where any buyer can view photos of a house for sale online real estate agents still expect to…

Well, technically the brokers get most of that.

Actually, they typically get 1/2.

Re: Real estate site Redfin files for IPO

#66

Post by Simon_says »

wyc wrote: post #10
notadoc wrote: post #3

I'm still waiting for someone to completely eliminate the realtor and charge a reasonable flat fee ($1000?) to buy/sell a house and handle all the related details. Why do we need realtors at this point? Everyone finds houses themselves online nowadays. Why does anyone need to pay a whopper commission to some middle-man?

Buying a house is among the largest purchases of many peoples' lives. It could be worth the $5,000-$50,000 (~6% of value in U.S.) for the piece of mind. People are used to using realtors. I don't think enough economists and business people give culture enough credit for its impact on businesses and finances. It's common enough that if the buyer tries to make direct contact with the seller, all parties are startled an…

That fee could easily be 3-6 months salary. That's a hefty price to pay for culture and piece of mind.

Re: Real estate site Redfin files for IPO

#67

Post by jdross »

Having completed thousands of home sales at Opendoor, I believe a system will works better for most home sales, but local expertise works better for high-end homes.

An agent always make you feel like their differentiation matters. Redfin advertises their refined process across thousands of homes to sell faster for more money. Your neighbor advertises their local expertise and awareness to get you an edge.

We joke that real estate is like politics – Everyone hates real estate agents, but loves their real estate agent.

Re: Real estate site Redfin files for IPO

#68

Post by apendleton »

hkmurakami wrote: post #52
Danihan wrote: post #35

Earlier quoted context omitted.

How does a web site get licensed as a real estate broker, anyway?

They have physical brokers in each region (I think the unit is more granular than each state, iirc?)

Yeah I think it's by metro area. I live in DC and the same office handles DC and the Maryland and Virginia DC suburbs, and I think many of the agents are cross-licensed.

Re: Real estate site Redfin files for IPO

#69

Post by mac01021 »

bdamm wrote: post #39
maguirre wrote: post #8

Earlier quoted context omitted.

seriously curious as I am about to pay 10k+ for selling my house. what are they doing that is so special?

I think buyers could brave buying a home without a realtor. It's a little crazy but doable. Selling is another matter entirely. If you would like the peace of mind to know that your home is actually in your past once the money is in your bank account, use a broker. Having your past home haunt your future can be a miserable prospect.

Why can't my attorney provide me with that assurance while he's taking me through the closing process? What extra thing is the broker doing?

Re: Real estate site Redfin files for IPO

#70

Post by jrs235 »

notadoc wrote: post #63
jrs235 wrote: post #54

Earlier quoted context omitted.

They don't get paid unless there is a successful sale. Listing contracts are for a fixed period. There are marketing expenses and time invested to list and market a property. If they don't successfully sell your home they don't get paid and they are out any of their time invested and marketing expenses. High risk, high reward.

> There are marketing expenses and time invested to list and market a property Putting a house on Zillow takes, what, 15 minutes? Perhaps the exception is very high end real estate, but from what I've seen most of the high end realtors are just really good at networking and schmoozing.

Add up all the time an agent spends previewing the property before listing, taking calls (especially from crazies) and arranging for showings, showings (including driving to and from), negotiating (writing up offers and counter offers), after acceptance arrangements such as coordinating inspections, final readings, closing arrangements. They only get paid if the deal closes.

The amount of effort is variable and unknown upfront (high risk, high reward).

Would you be willing to pay an hourly rate or per service rendered UPFRONT fee? I'm sure there are some brokers that offer such things. Most people don't want to part ways with their money before they know they actually sold their home (another nice thing about not having to pay until closing... the seller only pays if and at closing!)

How much do knowledgeable and experienced consultants make per hour?

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