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Real estate site Redfin files for IPO

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Re: Real estate site Redfin files for IPO

#111

Post by ericb »

opo wrote: post #62
ericb wrote: post #24

Earlier quoted context omitted.

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/selli…

A house sale is really a large contract agreement with a number of finer points. The legal fees were maybe $750 - 1200 but memory is sketchy on that. There are filings necessary with the state and other items that make it legal, and at least in Massachusetts USA, it is a lot different than say selling a mountain bike. Banks need certain info for loans, there's the deed, etc, inspections, etc.

When you are signing your 20th piece of paper, you realize you needed the lawyer. One dirty secret of realtors is that all this work is handled by lawyers, and the impossible-looking parts of a real estate transaction are handled by lawyers who understand it and have it down to a fixed-price cookie-cutter process for their locality. They did "consult" with me a bit and gave some "free" advice, but I just paid the fix price for doc generation mainly.

Re: Real estate site Redfin files for IPO

#112

Post by rgbrgb »

cabinguy wrote: post #73
rgbrgb wrote: post #59

Earlier quoted context omitted.

With Open Listings we started flat fee on the buy side but had a couple problems. First, it was very hard to communicate the value prop to customers. We went to market with something like "we refund the buyer's commission minus our flat fee". This brought up all kinds of questions and often buyers thought we were more expensive than realtors. Saying that we're 50% the price of a traditional realtor ended up being a m…

"seen how little work agents do..." This is going to sound condescending, but you honestly do not know much about the business you're in.

I'm not an agent myself, but I did help start a brokerage and spend most of my time automating busywork for our agents. Our top agents do 5-15 transactions per month in very competitive markets, have competitive acceptance and close rates, and great NPS scores. Agents are absolutely necessary to negotiate with sellers and talk stressed out buyers through the process, but most spend the majority of their time doing lead generation. I talked to an agent from a respectable brokerage in LA the other day who said she spends 95% of her time prospecting for new clients.

I'm not by any means saying agents are lazy, I maybe phrased that poorly. Just that if you're looking at the hourly rate the agent is making for the ~10 hours they're spending from offer to close, it's kind of wacky compared to most other types of high skill work (e.g. 10 hours on a 500k home with the typical 2.5% commission is $1,250/hour).

Re: Real estate site Redfin files for IPO

#113

Post by [deleted] »

jhulla wrote: post #89
hammock wrote: post #82

Earlier quoted context omitted.

>E.g: Check out the differences in who pays fees across counties: http://chicagotitletransfertax.com/ The complexities can be and already are structured in a table format? Seems like a job perfectly suited for a computer, not a human.

Sometimes transactions stick at the strangest places. For example, a buyer balks at paying a final $500 fee allotted to him because he has hit his financial stress limit - potentially killing the entire transaction. Good agents are not just facilitating the transaction, but also acting as friends/confidants/therapists for buyers&sellers - helping them make responsible decisions. Good agents also come up with creative…

[deleted]

Re: Real estate site Redfin files for IPO

#114

Post by runako »

opo wrote: post #62
ericb wrote: post #24

Earlier quoted context omitted.

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/selli…

Just to keep pricing in context, the media home value in the US is right around $200k. So the transfer cost ends up being ~$12k. If the RE attorneys (on each side) each spent a full day @ $200/hour on the closing, you're looking at $3,200. That creates an extra $9k to split between the parties. And there's no way a closing takes a full day for an attorney (and most will be less than $200/hr).

The best part is that that same $3,200 will transfer a house that costs a lot more. The more expensive the house, the more you should want to use a lawyer over a realtor.

Re: Real estate site Redfin files for IPO

#115

Post by adrianpike »

existencebox wrote: post #92
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…

Let me offer a different viewpoint. Redfin absolutely serves a purpose, but in some markets, notably for my case very hot markets, it's a significant impediment. I really wanted redfin to work, shopping in seattle 2 years ago. I tried for almost a year, but they would consistently be not as contactable or prompt as we wanted, and gave us very erroneous advice when it came to crafting offers on some houses we wanted.…

I had the same experience. I really wanted to use Redfin, and heavily used it for all my research and self-searches, but when the time came, I found my success with an agent.

Re: Real estate site Redfin files for IPO

#116

Post by bubbleRefuge »

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…

Or just a title company. I have twice gone without realtors in transactions. Sales contracts in my state, Florida, have a uniform structure. The title company, if its large enough, probably has a staff attorney. In one case, I was able to escalate issues to the attorney when the seller was tussling with me about changes to the contract. No additional costs other than normal closing fee's associated with title insurance and such.

Re: Real estate site Redfin files for IPO

#117

Post by javajammer »

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?

http://walawrealty.com/

Flat fee, and for "all the related details" - they represent you as lawyers. I had an exceedingly positive experience buying with them in 2012. I wish their model would become dominant.

Re: Real estate site Redfin files for IPO

#118

Post by MichaelGG »

toomuchtodo wrote: post #110
msielski wrote: post #90

Earlier quoted context omitted.

Knowledge of process, not just market. Which, don't get me wrong should also be easy to automate.

The hubris of this forum is astounding sometimes. Zillow and Redfin have attempted to automate just the valuation of properties (with enourmous resources behind them), and still aren't as accurate as traditional appraisers. It's easy? Edit: Even Zillow agrees. There's a million dollar prize if you can do better. http://www.marketwatch.com/amp/story/guid/D24B68EC-4090-11E7...

Don't professional appraisers actually go to the property and look around?

As for the rest, why should the process of selling a house require "expertise"? Apart from inspections, which require domain knowledge of infrastructure.

Re: Real estate site Redfin files for IPO

#119

Post by zaroth »

existencebox wrote: post #103
aetherson wrote: post #96

Earlier quoted context omitted.

I bought a house in SF three years ago through Redfin. The realtor that Redfin gave us was prompt, aggressive, and thorough in the bidding/closing process. What he didn't do is drive us around to open houses or suggest places to us. Which we didn't want anyway. I suspect that the individual realtor you get through Redfin has a big impact on your experience with the site. It sounds like you got a bad one and were unha…

We got, unfortunately, MULTIPLE realtors through redfin; some on our own request, some when they simply would disappear from the company/stop answering our emails. There was neither quality nor consistency, and we had marginal ability to impact that choice on our own, whereas with a personal realtor we went with someone highly recommended from work peers. I absolutely agree the individual realtor impacts the experien…

I've never used a buyer's agent and always written into my offers that the 3% buyers agent fee is to go back to the seller (and of course adjust the top-line offer accordingly).

I've never tried to buy in SF, but this strategy has always worked for me and saved a lot of money over the years. Frankly I can't understand the purpose of a buyers agent in this era, and taking 3% off the cost of a house is very substantial.

When the closing statement (HUD-1) is finally prepared, usually I can see that the seller's agent took some of the buyer's agent fee, e.g. they will end up with 4% instead of 3% in the end and the rest goes back to the seller. Since these offers usually mean more money for the seller'a agent they go to the top of the pile.

It's also important to disclose that you've purchased houses before, that you have funds, and that you are ready to close immediately. You don't need a buyers agent to tell you this.

Re: Real estate site Redfin files for IPO

#120

Post by hueving »

toomuchtodo wrote: post #110
msielski wrote: post #90

Earlier quoted context omitted.

Knowledge of process, not just market. Which, don't get me wrong should also be easy to automate.

The hubris of this forum is astounding sometimes. Zillow and Redfin have attempted to automate just the valuation of properties (with enourmous resources behind them), and still aren't as accurate as traditional appraisers. It's easy? Edit: Even Zillow agrees. There's a million dollar prize if you can do better. http://www.marketwatch.com/amp/story/guid/D24B68EC-4090-11E7...

If you don't know the difference between an appraiser and a real estate agent, you should stop commenting in such a condescending tone.
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