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Real estate site Redfin files for IPO

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Re: Real estate site Redfin files for IPO

#191

Post by gist »

bhandziuk wrote: post #184
gist wrote: post #177

Earlier quoted context omitted.

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…

I take it this is your first transaction buying a house. You are basing what you think on that and what people are saying online. I can assure you as someone that buys real estate (as investments) it typically isn't that easy, at least in a typical market and for most transactions. And I have been doing this since the 1980's fwiw.

Re: Real estate site Redfin files for IPO

#192

Post by just4themoney »

jjppott wrote: post #147
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 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…

Yes, yes, yes, this is so true.

When I was buying my house every time I asked a seller's agent a question about a house their answer was "I don't know." Every single damn time! If it wasn't written on the MLS they don't have a clue. That's even assuming the seller's agent was even physically there for the showing, only a few were.

My loan agent also told us that the taxes listed on the MLS were almost always flat out wrong so he always has to ignore the MLS and call the town when drafting up mortgages. I can't help but wonder if that's not so accidental. The taxes listed on the MLS for the house I ended up buying were wrong, for what its worth. Two municipals tax my house and the MLS only listed the tax for one of them.

Re: Real estate site Redfin files for IPO

#193

Post by jrs235 »

te wrote: post #144
zaroth wrote: post #119

Earlier quoted context omitted.

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…

So you reduce the top-line offer by 3%? Or, if your written offer specifies 3% back to you, how does the seller's agent manage to take 4% in contradiction to the offer? Not sure what jurisdiction you're operating in, but I wasn't aware that offers could dictate chagnes to the terms of a pre-existing listing agreement between the seller and their agent. Would love more details on how to effect something like this.

>but I wasn't aware that offers could dictate changes to the terms of a pre-existing listing agreement between the seller and their agent.

Exactly. Sounds like this borders on interference. The seller can't sign such an offer without breaking a previous contract. It may have worked for him because the broker was amendable to changing their agreement but by not having representation the person above may still have overpaid by 2%. What if the pricing strategy was to price 5% over what the seller really wanted knowing people would negotiate down.

Additionally the previous the buyer doesn't know what the co-broke fee, if any, is being offered to an agent that procures a buyer.

Re: Real estate site Redfin files for IPO

#194

Post by boulos »

rgbrgb wrote: post #59
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?

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…

Aha! I knew I wasn't crazy... I had told multiple people that Open Listings was the true incarnation of "this should be a fixed fee, not percent of transaction" only to be proven wrong by your current pricing page.

Maybe like Vanguard you could do a sliding scale as the home price goes up? That is, instead of doing 50% off at all points (and I know you're focused on CA, but bear with me) you could increase the discount at higher price points. That way a $2.5M home on OpenListings is suddenly really attractive to the high end, while you'd still be the best option at the lower end (your pricing comparison to Redfin is genius, since I believed they did a 50/50 split).

Did different portions of California respond differently to your pricing? I'm seriously sad that people buying a home wouldn't do the math to see that your flat fee was drastically lower than any percentage.

Re: Real estate site Redfin files for IPO

#195

Post by mmanfrin »

aetherson wrote: post #96
existencebox wrote: post #92

Earlier quoted context omitted.

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 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…

Was it Kenny? I, too, bought a house in the Bay Area a bit less than 3 years ago, and your experience is exact to what mine was. It was really pleasant, especially compared to the times I had gone along with my parents when they were house shopping with a traditional realtor.

Re: Real estate site Redfin files for IPO

#196

Post by bacontacos »

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.

In markets where anything can happen and buyers overbid on the order of 100-300k over asking price simply because they want it and will do anything to get it, it is very difficult to accurately estimate the value and/or selling price of a home.

also, ever wonder why the home appraisal comes in right at the offer price during the loan process? its not a coincidence. the appraised price typically has more to do with conducting a business transaction in the interest of all parties involved and less to do with an actual valuation of the home.

Re: Real estate site Redfin files for IPO

#197

Post by bhandziuk »

gist wrote: post #191
bhandziuk wrote: post #184

Earlier quoted context omitted.

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…

I take it this is your first transaction buying a house. You are basing what you think on that and what people are saying online. I can assure you as someone that buys real estate (as investments) it typically isn't that easy, at least in a typical market and for most transactions. And I have been doing this since the 1980's fwiw.

You're right it was my first house.

I do believe it is sometimes more complicated. But is the value of a realtor's time to me, as a buyer or seller, really several hundred dollars per hour? Is buying a 600k house really twice as difficult a transaction than a 300k house? Why are they not paid a flat fee?

Re: Real estate site Redfin files for IPO

#198

Post by pfranz »

jjppott wrote: post #147
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 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…

I guess I'm looking for different expertise. I wouldn't trust them to have any building knowledge. I want them to know the local market. I bought a house in Los Angeles a few years ago. Because everything is so expensive we were fairly open to different areas in a radius around our jobs. It was easy to overlook neighborhoods that were a good fit just by looking at a map of house sales. I reached out to a few realtors in different parts of town. They could help answer questions about schools (and charter schools), what was low and high for the neighborhood, and other things I could find out myself, but would take too much time if I did it for a dozen neighborhoods.

They also were really helpful in scheduling walkthroughs before the house would go on the market, and scheduling all of the inspections--they also offered to be on site if I couldn't make it.

I also think they keep the sale rational when either side can get too sentimental. After inspectors found a few, minor things, the seller only offered to address them after adding another 5k onto the price (at no point was 'as-is' mentioned). This was after a few other petty things from the seller and I considered walking away. The house had been in escrow with no backup bids before we showed up. So I wouldn't be surprised if that happened last time, too.

Re: Real estate site Redfin files for IPO

#199

Post by BowBun »

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?

Having just left a job in this exact field, maybe I can give you an insight I haven't seen on here yet:

There's a huge monopoly present in real estate data right now. At a very high level: The NAR (National Association of Realtors) licenses real estate agents, they pretty much allow you to do business and you cannot sell houses in the US without their approval. MLSes (Multiple Listing Service) are organizations created for a region/state/city, depending on the size/market. These are exclusively permitted by the NAR. All realtors MUST put their house data on an MLS. These realtors are also forced to pay large amounts to access these feeds. All traditional real estate data only lives in these organizations, with high barriers to extracting and manipulating the data since they want to keep their monopoly.

Basically, the real estate world is very entrenched in these monopolistic practices, and we're only now seeing significant efforts to accumulate and dissipate the data in a way that makes it more accessible. Personally, I wouldn't expect any major overhaul as the NAR is a HUGE lobbying group and have gotten a good amount of legislation around real estate on their side.

Hope that helps!

Re: Real estate site Redfin files for IPO

#200

Post by GFischer »

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...

I'd say that Zillow and Redfin are better on average than traditional appraisers.

Traditional appraisers might be better in certain markets or conditions though (probably Zillow and Redfin are more generic).

I've worked on homeowners insurance and I've seen wildly differing appraisals.

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