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Real estate site Redfin files for IPO

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Re: Real estate site Redfin files for IPO

#311

Post by harrumph »

blocacres wrote: post #236
harrumph wrote: post #107

Earlier quoted context omitted.

> What marketing plan is going to sell a house in a week? None at market value. Do not agree. Markets are only collections of people, and brokers know people, some of whom are buyers and a few of whom are the perfect buyers. Reaching those people is the marketing plan. Also, this is not buying airplane tickets, this is the single most costly and complicated process buyers and sellers will likely go through in their w…

"This is the single most costly and complicated process people will go through. .." so why hire someone for 5-7% of the purchase price, who doesn't have a college degree and has been in the industry for 3 years or less. Furthermore, notice the incentives if you're a buyer literally everyone in the transaction from real estate agent to mortgage broker wants the price to be as high as possible. The incentives all point…

>so why hire someone for 5-7% of the purchase price

What's a few hundred basis points of exaggeration when trying to make a point, right?

>who doesn't have a college degree

Anecdote time: I know well five brokers, all who have degrees, one with an advanced degree.

>and has been in the industry for 3 years or less.

Now here, you have described Redfin agents almost perfectly. Huge turnover, low compensation, bad broker work and no long term interest in a career that facilitates a race to the bottom.

> Furthermore, notice the incentives if you're a buyer literally everyone in the transaction from real estate agent to mortgage broker wants the price to be as high as possible.

Yes some buyers can avoid involving intermediaries, and that's where Redfin and its ilk can work well. But it is a fact that without negotiation skill and deep experience in the product, all that upward price pressure goes unanswered. Markets aren't magic, they are collections of people, and agents who earn their keep are persons skilled at high touch, high risk transactions between people.

> We're going to fix this.

Redfin's had 12 years and what's more, its flat-rate business model predates the web. Would you like a few more decades?

Re: Real estate site Redfin files for IPO

#312

Post by everybodyknows »

pweissbrod wrote: post #285
just4themoney wrote: post #139

Earlier quoted context omitted.

If you really want to get your blood boiling about buyer's agents, watch this - https://youtu.be/jxcCJxN8aJE Red Fin doesn't operate in my area but if it did I'd be all over it in a heartbeat when I bought my house.

First two minutes of that video states the issue is limited to the case where the agent represents both the buying and selling parties which is only legal in canada. I'm not canadian. I dont know how commonplace this is. But as an american it sounds pretty foolish of someone to accept a deal on your next mortgage with someone who openly controls both parties.

Double-ended deals are legal in some US states e.g. California, and they are indeed an opportunity for breach of fiduciary duty. The way it works is that a crooked agent would get the seller to sign a listing contract that stipulates 3% to whatever agent represents the buyer irrespective of who that agent was working for. Then present only double-ended offers, or lowball outside offers to the seller -- hiding any higher offers that came through buyer's agents. And naive sellers have been defrauded this way.

The seller's defense is simple: Refuse to sign any listing contract that stipulates more than a 1% commission to a buyer's agent that is in any financial way affiliated with the listing agent's office. 1% being roughly in line with the actual effort required from the listing agent to deal with buyer-side coordination as well.

Such a stipulation doesn't quite close the door on collusion through favor trading, among agents in the local old-boy-and-girl network. But it's enough to shield you the seller from the grosser frauds out there.

Re: Real estate site Redfin files for IPO

#313

Post by bhandziuk »

jrs235 wrote: post #244
bhandziuk wrote: post #175

Earlier quoted context omitted.

This is so true. Not only do they typically not know anything more about nay given home that you, the buyer, do. If they are on the selling side they will also outright lie about home features. I experienced this so many times on houses I visited and even on the house I ultimately purchased. You just have you shrug your shoulders and fix whatever they misrepresented.

In my state you should file a complaint against that agent with the department/office that oversees real estate licensing. And you might be eligible to be compensated for the agents misrepresentations if you can prove them.

I'd love to. Some of the things seem difficult to prove. Such as

> Welcome Home!!! Take a seat on the PORCH SWING on your COVERED DECK and enjoy the Fall Season! Come inside this cozy home and view it's OPEN FLOOR PLAN [calling this open floor plan is a big stretch], Original HARDWOOD Floors [and they are destroyed as a result. Water damage. literally cut through to put in a furnace in the basement in one place. Covered by a carpet in the living room and destroyed as a result] and FRESH Neutral Paint. Two bedrooms and a LARGE full bath [probably as small as it gets while still being a full bath] on the Main Floor with a SUNNY eat-in Kitchen and Conveniently located MUDROOM, additional bedroom/office in the basement [not legally a bedroom]. This home features Updated ELECTRICAL [in some places sure. Half the house is still crappy old cloth wrapped wire], Updated PLUMBING throughout, Living Room is WIRED for SURROUND SOUND, [broken] SPRINKLER SYSTEM and NEW Roof with a LIFETIME transferrable Warranty! Detached Garage has HEAT & A/C, Wired for Cable and LAN line [a CAT5 cable that terminates in the floor and is not accessible to be hooked up to anything because it's in the floor!], has Electric [electricity to the building no where near code because it is fed from two sources] and a HUGE Attic space to Provide LOTS of EXTRA STORAGE. This home has a Private COVERED PATIO in the back where you can relax and enjoy YOUR NEW HOME!

There was more in the listing than this but that's just the basic bio.

Re: Real estate site Redfin files for IPO

#314

Post by everybodyknows »

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.…

How to: Find a good Redfin agent.

1. Search local Redfin web site for agents who have done deals near your locale of interest.

2. Check internal reviews of agents on Redfin. Bad reviews don't get posted, so "chose not leave a review" on a transaction means either: a) client had unreasonable expectations, or b) agent performed badly.

3. Interview agents in person, and ask challenging questions. If you don't get responses that are either: a) correct and candid, or b) "I will get back to you tomorrow with an answer", move on to the next agent.

This recipe led me to a very good Redfin agent, working inside an office run by a very bad but "senior" agent.

Re: Real estate site Redfin files for IPO

#316

Post by everybodyknows »

Guess how many California-licensed real estate BROKERS Redfin employs? The answer is here:

http://www2.dre.ca.gov/PublicASP/pplinfo.asp?License_id=0152...

A total of six BROKERS. Helped out by 528 SALESPERSONS, who have little or no financial responsibility.

A curious fact that no RE agent or Realtor will tell you: Under California law, the terms "real estate agent" or "Realtor" have no significance.

Re: Real estate site Redfin files for IPO

#317

Post by sshanky »

zaroth wrote: post #119
existencebox wrote: post #103

Earlier quoted context omitted.

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…

This, exactly. If you're comfortable enough with the property you're buying and know what to look for, the selling agent has a decent reputation (i.e. he has something to lose if he tries to cheat you), and have been through the process before, you can easily approach the selling agent without an agent of your own. An experienced agent will understand what's going on and know that this leaves another 3% to work with. I'll probably never use a buyer's agent again in my home market, though I would probably use one in an unfamiliar city.
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