Real estate site Redfin files for IPO • Hacker News Board

Re: Real estate site Redfin files for IPO

#181

Post by cgh » Fri, Jul 07, 2017, 9:39 PM UTC

gist wrote: post #97

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…

> where any buyer can view photos of a house for sale online real estate agents still expect to receive 6% It's not the same as buying a car as you have to gain access to the property to look at it which involves another agent and much work even after an offer has been accepted or negotiated. The only thing that is 'absurd' is that the commission generally stays the same whether the house is 1.5 million or 150,000. A…

We bought our house with no agents at all, buyer or seller. We used a notary public to do all the legal paperwork. Savings: $20,000 (Canada).

If you can possibly avoid using a real estate agent, then do so. They may bring some value but it is not nearly commensurate with their commissions.

Re: Real estate site Redfin files for IPO

#182

Post by GFischer » Fri, Jul 07, 2017, 9:41 PM UTC

toomuchtodo wrote: post #16

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?

"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'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."

That can be done (and is done) for cookie-cutter projects such as websites.

A company I consulted for offers 600 dollar CMS websites, no extra fees.

I've also paid amazingly low prices for other kind of "bolt-library-together" projects.

A lot of companies do overpay, but there's also a lot of variance between projects.

Re: Real estate site Redfin files for IPO

#183

Post by stickfigure » Fri, Jul 07, 2017, 9:42 PM UTC

toomuchtodo wrote: post #122

hueving wrote: post #120

Earlier quoted context omitted.

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

Fair point! A realtor can still walk a property to perform a market analysis, which is still more accurate than an automated valuation. I'm exhausted by the never ending comments here "it's easy! Anyone can do this!" when it's clearly not. I'm simply countering the disingenuity, whether the source is ignorance or arrogance.

Anyone can do this. In fact, I do it every time I walk into a home and decide what I might be willing to pay for it.

Re: Real estate site Redfin files for IPO

#184

Post by bhandziuk » Fri, Jul 07, 2017, 9:44 PM UTC

gist wrote: post #177

bhandziuk wrote: post #171

Earlier quoted context omitted.

That commission is huge. I just bought a 280k house which means the agent gets ~7,800 $. Sure they maybe keep some fraction of that but that is such a crazy big dollar amount. That's several month salary for me and they did it in a few hours of work. Plus, because this is paid through what eventually becomes my mortgage I'm paying that inflated price for decades. With those kinds of numbers I see why it is such a gua…

You are comparing a case where it only took them 'a few hours' for your particular transaction with all the time they had to spend either showing that house and getting nothing or showing other houses and getting nothing. Do you honesty believe the majority of transactions they do are so quick and easy? What do you think they are doing a transaction like that per week? There is an overhead cost to dealing with people…

They were very rarely available to show us homes and instead just gave us the lock box codes to we could walk through on our own.

It was also suspicious they felt the need to justify their existence saying the hard part is drawing up the contracts. But as far as we could tell the loan company did all that work. The realtor just showed up to the signing and let the loan officers answer any questions we had.

Sure, most transactions are not as fast and easy for them but it seems with these numbers if they are with one client for 2 weeks straight and sell a house at the end they are still way ahead. Even if they sell 1 house a month at that rate it's still a killing.

Re: Real estate site Redfin files for IPO

#185

Post by cgh » Fri, Jul 07, 2017, 9:44 PM UTC

toomuchtodo wrote: post #122

hueving wrote: post #120

Earlier quoted context omitted.

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

Fair point! A realtor can still walk a property to perform a market analysis, which is still more accurate than an automated valuation. I'm exhausted by the never ending comments here "it's easy! Anyone can do this!" when it's clearly not. I'm simply countering the disingenuity, whether the source is ignorance or arrogance.

As buyers, we simply hired an appraisal firm. I think it cost around $300. Then we hired a notary public to handle the paperwork, about $2500.

Honestly, if you think real estate agents are the only ones capable of managing this process, then I can only assume you've never bought a house.

Re: Real estate site Redfin files for IPO

#186

Post by vostok » Fri, Jul 07, 2017, 9:45 PM UTC

hijinks wrote: post #180

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…

I wanted redfin to work when we solf our house in the SF Bay area a few months ago. Redfin's issue is the selling agent was located 45 minutes away and just ran random comps and said our house was 120k lower then market. She said it would never sell for what I thought it was worth. So we ended up going with a local agent who put it on market for more then we thought and it sold for 1% over asking.

This happens with full price agents too. In my experience, their "expertise" is really just confidence and bluster. Commissions are high not because real estate salespeople are good, but because they are inefficient and because they operate under a de facto cartel.

Re: Real estate site Redfin files for IPO

#187

Post by dragonwriter » Fri, Jul 07, 2017, 9:45 PM UTC

stickfigure wrote: post #183

toomuchtodo wrote: post #122

Earlier quoted context omitted.

Fair point! A realtor can still walk a property to perform a market analysis, which is still more accurate than an automated valuation. I'm exhausted by the never ending comments here "it's easy! Anyone can do this!" when it's clearly not. I'm simply countering the disingenuity, whether the source is ignorance or arrogance.

Anyone can do this. In fact, I do it every time I walk into a home and decide what I might be willing to pay for it.

Anyone can do an estimate; whether they can do it better than Zillow, etc., algorithms is a different question.

Re: Real estate site Redfin files for IPO

#188

Post by jjppott » Fri, Jul 07, 2017, 9:45 PM UTC

alexchantavy wrote: post #166

jjppott wrote: post #147

Earlier quoted context omitted.

I generally have a different opinion. I am somewhat in the industry (construction side) and I feel that generally most realtors dont really have much knowledge of what they are selling. Furthermore, it is relatively easy to get a real estate license (at least where I live) and the handful of acquaintances that have gotten their license really dont know more than the average person. I actually find the lack of knowled…

Any rules of thumb/advice you can offer on evaluating home quality from your experience?

That is a tough one. I have been in the industry for 10+ years and a lot of it in the higher end custom home side. To me a couple of things that standout as super cheap are jump ducts (basically they didnt bother to put a return air duct in a room and just put a whole in a wall with grills on either side to allow air transfer), hollow core interior doors (you can hear/feel the difference if you knock on a hollow core door versus a solid door), all stucco exterior (cheapest clading material where I live), sometimes upper floor water pressure is almost non-existent and they dont put in a booster pump, and on and on... I feel like it really varies from project to project. I have seen some where they actually spent a decent amount on the cabinet drawer/door fronts, but then didnt bother to spend a couple of hundred more on good undermount drawer guides. Others where they didnt bother to think about layout/flow in a kitchen (aka the island looks great, but if I open my fridge I cant squeeze by the island and the door to actually get anything out of it). I think generally a lot of what people are trying to build today qualifies as "modern" but to me it just looks/feels cheap. To truly do modern well is very expensive. I dont particularly like the look, but thats just my opinion.

Older construction is another area entirely. When flipping houses became popular a lot of people got into the industry who didnt know what they were doing, or they went about trying to do it as quick and cheaply as possible. I have heard that the less you know about a place you are trying to flip the better. AKA if I dont open up any walls to see if the electrical doesnt actually meet code, then I dont have to spend a bunch of money replacing it! Or I didnt get a structural engineer to look at the foundation so I dont know if there are any issues with it and therefore I dont need to disclose anything to a potential buyer.

Re: Real estate site Redfin files for IPO

#189

Post by gist » Fri, Jul 07, 2017, 9:46 PM UTC

hueving wrote: post #123

gist wrote: post #102

Earlier quoted context omitted.

Agree. But you are wasting your time on HN arguing those points. On HN (many) people are curious, think they rise to a challenge, and think they have the time and bandwidth to defeat any obstacle or achieve any goal they want. And are additionally willing to DIY it just for sport. The shocking thing is how little they understand how 'normal' folks operate. Wanting simple, easy and not necessarily having either the ti…

The problem isn't that real estate agents are offering the service, it's that you're pretty much forced into using it.

You are not 'forced' into using it.

You can compile your own information of houses that may be for sale that aren't for sale and approach the owner directly and try to buy it. You can also approach people who had their houses listed that took them off the market and approach them after the listing expired.

Think I am making this up? That is exactly what I did with one property that I bought. It was listed one year and never sold. I wrote a letter to the owner saying I wanted to buy it, struck a deal, and bought it. Simple common sense.

Let's say you are interested in a condo (as only one example could be houses in a development) in a particular building. Send a postal letter to everyone in the building. Say you are a serious buyer and ask them if they want to sell. In a large enough building you will get people that are thinking about selling and you can strike a deal.

Management offices (at condos) often know who might be selling as well. Contact them.

I have gotten deals for buying real estate from property management companies as well. They send me leads and I don't have to use a realtor at all. They know I am a buyer because I have communicated that to them. Also helps to buy small gifts for the person that holds that info or at least be super nice.

Re: Real estate site Redfin files for IPO

#190

Post by GFischer » Fri, Jul 07, 2017, 9:46 PM UTC

jasode wrote: post #129

MichaelGG wrote: post #118

Earlier quoted context omitted.

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.

>why should the process of selling a house require "expertise"? At a fundamental level, one could say sellers don't require outside expertise to sell a home. Real estate agents are optional. There is a concept called "for sale by owner" which is a strategy some homeowners use. They can list the house on their own (not on MLS though), vet potential buyers, coordinate the showing of the home (appointments and/or open h…

The real economic question is whether they can keep charging 6% commissions as the internet evolves

That's the point. In pre-internet ages, there was a huge information imbalance that kind of validated that 6% (also, there wasn't such a ridiculous housing bubble).

Someone mentioned a real estate agent making 1250 dollars/hour. I would be willing to jump whatever hoops were needed to make that kind of money if I were in the U.S.