Redfin is the biggest discount real estate brokerage in America. However, in 2022, Redfin has fallen behind on several key aspects including savings on commissions and on technology.
Key Takeaways
- Pros: Redfin is a known brand and its agents are salaried, so they don’t have any incentive to give you bad advice
- Cons: At 1.5% commission, Redfin is one of the more expensive discount brokers. Redfin takes 18 days to list a property, and its technology is not cutting-edge. Finally, Redfin is available only in select markets
- Bottomline: For most home buyers and sellers, we do not recommend Redfin. You will save more money and get listed faster with Houzeo.com. View your savings.
💰Discount Real Estate Brokers: Check Out Our 2023 Rankings!
What is Redfin?
Redfin is one of America’s top discount brokers. The company provides an online portal that operates as a brokerage firm. Home sellers and home buyers can hire the services of a real estate agent by registering on the website or the mobile app.
Today, Redfin is valued at $1.81 billion. Redfin has over 3000 agents, who are paid a salary, instead of a commission. Presently, Redfin’s services are available throughout America.
» Discount Real Estate Brokers: Find out America’s top 10 discount real estate brokers & brokerages
Is Redfin Legit?
Yes, Redfin is a legitimate company established in 2004. Since the company went public in 2017, it has grown to become one of the top discount real estate brokers in the United States. Presently, Redfin is available in 100+ markets across the country.
Redfin real estate agent services are priced at just 1% to 1.5% commission, far less than the customary 3% commission. Additionally, Redfin provides services like RedfinNow, Redfin Premier, and Redfin Pricing, fulfilling home sellers’ and home buyers’ every need.
🎯 Key Takeaways
- Redfin benefits both sellers and buyers by offering a low commission and rebates.
- Although Redfin advertises 1% commission, the offer can be redeemed only if you buy AND sell from Redfin within a year.
- Redfin Home Value Estimator helps you determine the price of your house.
» Low Commission Real Estate Agents: Check out America’s top 10 low commission real estate agents and companies
How Does Redfin Work?
Redfin’s business model offers home sellers and home buyers real estate agent services for a low commission rate. These low service costs are achieved by cutting down on operating costs. Further, Redfin upsells existing customers by offering personalized support with additional services.
With the help of Redfin agent tools, Redfin agents are able to serve a vast array of clients. Redfin Realty saves on marketing by promoting real estate agent services through the Redfin app and website.
One of the major drawbacks of working with Redfin is its inconsistent service quality. Due to the high volume of customers for a single agent, the support and attention are limited.
Selling with Redfin Reviews
With Redfin selling services, you are teamed up with an in-house real estate agent. All of Redfin’s agents are salaried employees, and they don’t receive the usual commission incentives.
Despite not receiving commission the traditional way, Redfin agents are still paid even if a house gets sold below the market value. Although most agents get paid for their services under Redfin, a significant amount of their incentives are removed from their earnings.
In effect, this impacts the agent’s performance and commitment to selling your house. Comparatively, Redfin concierge guarantees better services, but this service is charges a higher commission of 2.5%.
Considering these Redfin real estate agent reviews before you decide to opt for Redfin’s services would be a wise choice.
✔️ Pros
- Redfin commission is very low, less than the traditional 6% commission
- More transparency in transactions compared to other brokerage services
- Excellent mobile app features
❌ Cons
- Inconsistent service quality
- Risk of being paired with incompetent or inexperienced agents
- Low initial offers
Buying with Redfin
According to the majority of Redfin reviews across the internet, buying with Redfin is an experience worse than selling through Redfin. Pairing up with an agent is a hit-or-miss situation. You may either find a good agent or an unresponsive one.
As a buyer, you don’t have to pay anything in commission. The buyer agent’s commission is given by the seller.
Additionally, the Redfin buyer rebate option lets you demand a buyer’s rebate for certain buyers. This rebate will normally go towards your closing costs and save you some money. However, the Redfin rebate does not reveal how much you can get. It only claims a ballpark of $1,500.
Redfin Services
The selling experience with Redfin is similar to the traditional brokerage method. This means you get the services of a real estate agent to guide you through the transaction.
By paying the Redfin listing fee, you get the following services:
- Pricing
- Professional photography
- Home staging
- Conducting open houses
- Offer reviews
- Negotiations
Redfin Concierge
It is a premium service option that charges a 2.5% commission. For the extra commission, you get upgraded services like professional home staging and house cleaning.
- 📝 NOTE: This package does not provide value for money. Home sellers can instead save money buy purchasing a-la-carte services like staging and 3D photography.
Redfin Full Service
For a low commission of just 1.5%, a local Redfin agent assists you in every step of buying or selling your home till closing. But make sure to check the Redfin agent commission in your area before buying, as it changes across different areas.
Redfin Premier
This service is available for luxury properties that are priced at more than $1 million. Redfin Premier guarantees only the best of Redfin’s experienced agents, plus additional services like staging, drone photography, and maximum exposure.
RedfinNow
RedfinNow is an ‘as-is’ iBuyer service offered by Redfin that makes instant cash offers to home sellers. Redfin has shut down its iBuying program, Redfin Now on November 9, 2022.
» Companies that Buy Houses for Cash: Find out the 15 best cash companies in America
Redfin Partner Agent
In areas that fall out of Redfin’s direct service area, you get assigned to a Redfin partner agent. Unlike most Redfin’s agents, partner agents do not work directly under Redfin.
You may also get assigned to a partner agent if Redfin is experiencing a shortage of in-house agents or if your home is below Redfin’s minimum price.
- 📝 NOTE: As partner agents do not work exclusively under Redfin, they may charge a higher commission rate than just 1.5%. Also, hiring the services of Redfin’s partner agent to buy or sell disqualifies you from availing of Redfin’s reduced 1% commission.
How much is Redfin’s Fee?
When selling with Redfin, you pay a commission of just 1.5% of your home’s price. Additionally, you also pay the buyer agent commission. Typically, this commission goes up to 2.5% to 3% of the selling price.
A high buyer agent commission could attract more offers for your home. Here’s a breakdown of fees you pay when selling with Redfin:
| Redfin Fee | 1.5% |
| Buyer Agent Commission | 2.5% – 3% |
| Total | 4% – 4.5% |
Redfin Hidden Fees
Typically, Redfin does not charge hidden fees at closing. However, Redfin also does not disclose upfront about its minimum fee policy.
Redfin Minimum Fee
Most people don’t know that Redfin charges minimum fees to its clients. This means that if the 1.5% commission does not cover the minimum charge amount, you will end up paying more than 1.5% commission.
This fee changes location-wise throughout the US, ranging between $2,000 to $7,000. Redfin’s minimum fee can adversely affect your savings if your selling price is low in an inflated market.
Assuming that your selling price is $200,000, here’s a breakdown of Redfin’s minimum fees in different markets:
| Property Value | Market | Redfin Minimum Fee | Redfin Listing Fee | Extra Commission | Paid Listing Commission | Total Commission (+ 2.5% Buyer Agent ) |
|---|---|---|---|---|---|---|
| $200,000 | New York | $4500 | 1.5% | $1500 | 2.25% | 4.75% |
| $200,000 | Orange County | $5500 | 1.5% | $2500 | 2.75% | 5.25% |
| $200,000 | Boston | $4500 | 1.5% | $1500 | 2.25% | 4.75% |
Is Redfin Really 1%?
Yes, but it depends on one condition. You must sell AND buy a home using Redfin’s agent services within 365 days to qualify for the 1% reduced commission. If not, you pay the standard 1.5% commission.
Once you close on a new home, Redfin will send you a check for 0.5% of the final selling price of the home you sold before. If you are selling your home after having bought one with Redfin, 0.5% of fees will be reduced from your listing commission.
- 📝 NOTE: Hiring the services of Redfin’s partner agent will disqualify you from availing of the reduced commission rate. Also, the 1% listing fee is not available in some states where it is prohibited by law.
Calculate your Savings: Traditional Agent vs. Redfin vs. Houzeo
Redfin Reviews: Is Redfin Worth it?
Overall, Redfin has a mixed bag of reviews. It has an average rating of 3.2 out of 5 across various websites like Consumer Affairs, Yelp, and Google.
Here are some reasons why Redfin is a good alternative:
✅ Low Commission, Discounted Rates
Compared to most brokerages, Redfin commission fees are priced very low. Naturally, this saves you a lot of money. For instance, consider the selling price of your home was $500,000. With Redfin, you can potentially save about $10,000 compared to a traditional agent.
✅ User-Friendly Technology
Redfin offers a mobile app and a user-friendly, easy-to-navigate website. Compared to most traditional brokerages, Redfin’s technology is by far one of the best in the market. You can also apply various filters to look for specific options when looking for a home.
For instance, you can set the number of stories or parking spaces according to your preference. The mobile app notifies you of recent listings in your area, upcoming open houses, etc. Further, you can set up dates and meetings with Redfin’s in-app calendar.
✅ Safer than other Discount Brokers
Although Redfin’s services are inconsistent, working with Redfin is less risky compared to other brands. Redfin Realtors follow a team-based approach, which means there are multiple stakeholders involved in a single deal.
This ensures ample supervision and expertise in a real estate transaction.
Why Redfin is Bad
Redfin has an average rating of 3.2 stars out of 5. To sum up, the following factors account for the majority of Redfin’s poor ratings:
⛔ Inconsistency in Agent’s Quality
Compared to traditional agents, Redfin agents handle multiple clients together. Due to this, some clients may not get the necessary attention, leading to bad deals.
Additionally, Redfin agents may not always give the top-quality service that the company guarantees. This could easily waste your time and money, with no transaction happening at all.
⛔ Tedious Paperwork
Although the agent matching service is an online process, most of the paperwork is done in person. Completing paperwork like listing agreement, purchase agreement, disclosures, etc. can take hours on end, plus you have to do this at the agent’s convenience. Setting up an appointment can take weeks, which further delays the whole process.
⏰ Blast Past Paperwork with Houzeo.com
Houzeo’s high-tech website is 100% online, letting you list your house on the MLS in less than 48 business hours.
START YOUR MLS LISTING NOW
⛔ Redfin Takes 18 Days to List your Home
Redfin’s listing agreement provides you with a 6-week listing prep and marketing program. Here’s a snippet of the marketing schedule by Redfin for home sellers:
Redfin Listing Agreement
This program covers major pre-requisites before listing your house, including inspection and home prepping.
Although this plan is thorough, it takes almost 18 days for your property to get listed.
Most real estate services list your property far quicker, within a week or so. Houzeo’s Flat Fee MLS services help you list your home within 24-48 hours, far quicker than what Redfin offers.
Alternatives to Redfin
Here are some alternatives to consider before you opt for a Redfin Realtor:
1. Redfin vs Houzeo
Houzeo.com offers Flat Fee MLS listing services for home sellers. With just a few dollars, your listing gets syndicated to 100+ websites, including Redfin, Zillow, Trulia, and more. Houzeo has created a 100% online platform for managing your home sale.
Why’s Houzeo #1?
Houzeo.com’s biggest advantage is exposure to the MLS. Buyer agents hunt for properties on the MLS, so an MLS listing via Houzeo.com provides unparalleled exposure to your home.
Additionally, Houzeo’s advanced technology makes the FSBO paperwork and listing management process quick and efficient. Houzeo.com offers the best combination of maximum savings, no hidden fees, and 5-star customer support. For listing your home on the MLS, Houzeo offers 4 listing packages customized to serve your needs.
- Bronze Package – $299: It is the best for selling a lot or land property by the owner. Your FSBO listing gets syndicated to Zillow, Trulia, Realtor, Redfin, and more.
- Silver Package – $349: This includes everything that FSBO home sellers typically look for.
- Gold Package – $399: It is Houzeo’s signature MLS package and includes all the technology Houzeo is known for: Houzeo Showings, Houzeo Offers, and DigiTransact.
- Platinum – $999+: It includes the assistance of a licensed broker to help you with negotiations, disclosures, and closing.
Here’s a quick overview of Houzeo’s & Redfin’s features compared:
| Feature Comparison | Houzeo | Redfin |
|---|---|---|
| Nationwide coverage | ✅ | ✅ |
| 100% Online Process | ✅ | ❌ |
| Mobile App | ✅ | ✅ |
| Offers sent directly to you | ✅ | ❌ |
| Countering an offer | ✅ | ❌ |
| Request the highest & best offer | ✅ | ❌ |
| Showing management | ✅ | ❌ |
| Expedited listing | ✅ | ❌ |
| Quick listing changes | ✅ | ❌ |
| Buyer property search feature | ✅ | ✅ |
» Selling a House Without a Realtor: Learn how to sell your house without a Realtor with Houzeo’s guide!
Introducing the Houzeo Mobile App!
- View your listing
- Manage your showings online
- Review and compare offers
- Counter an offer
- NEW! Buyers can now search your property and save it in “Favorites”
» For Sale By Owner Websites: Find out America’s top 12 FSBO websites
2. Redfin vs Zillow
Zillow has a place in America’s top websites for real estate, with over 200 million monthly visits. Zillow provides the critical exposure required for selling FSBO. Plus, Zillow also has a home value estimator, named Zestimate which is similar to Redfin Estimate.
Zillow offers a free listing on their website; all you need to do is create an account on Zillow.com.
- FSBO Listing on Zillow – $0: Includes an FSBO listing on Zillow.com. The listing is hidden by default, so you lose direct contact with potential buyers.
- MLS Listing via Zillow Premier Agent – 3%: As an FSBO home seller, if you choose to list on MLS, Zillow’s member agent comes into the picture, and you end up paying 3% listing agent commission or more.
» Redfin vs Zillow: Check out which real estate website has the best reviews
3. Traditional Agent
Most real estate brokers are not salaried employees like Redfin. They earn through the commission they make from selling or buying a house for you. This implies that such agents specifically have the best interest in mind for your transaction.
On the other hand, Redfin agents handle multiple clients at a time and work for a fixed income. This may affect their service quality. As stated above already, several customer reviews comment about how Redfin’s agent services are highly inconsistent.
» Top Real Estate Agents: Find out America’s top 10 real estate agents
Bottom Line: Is Redfin Worth it?
Depends.
Buying or selling a home is a complicated process and the risks involved are plenty. The state of your transaction depends largely on the agent you get. With Redfin, you may get a very experienced and professional agent, but the possibility of it not happening exists as well.
Hence, making some research before paying up for any brokerage of Flat Fee MLS service is necessary.
To conclude, it can be seen from the above reviews that Redfin’s services are highly inconsistent. You may end up with the best of Redfin’s agent, or a worse one. If you are willing to bet on the odds, Redfin is the best way for you to go.
Frequently Asked Questions
1) How accurate is Redfin estimate?
Close to accuracy, but not as good as Zillow's tool, Zestimate. Redfin estimate is a home value estimator tool, that helps you fix a selling price for your home by conducting a comparative market analysis.
2) Does Redfin buy homes?
Yes. One of Redfin's services called RedfinNow is an 'as-is' iBuyer that makes cash offers to home sellers. However, RedfinNow is available only in select markets.
3) How much do Redfin agents make?
Redfin agents are salaried employees, as opposed to the majority of agents who work for a commission. Hence, Redfin agents make monthly salaries like any other corporate employee.
4) Who owns Redfin?
Redfin is owned by Glenn Kelman, who is the CEO of Redfin.
5) How does Redfin work for sellers?
Sellers who sell with Redfin have to pay a lower commission of 1.5% as opposed to the standard 3%. You get assigned to a Redfin agent after you register on the website. Although Redfin offers full-service agents for low commission rates, Redfin's agent services are highly inconsistent across different markets. You may get assigned to a professional, expert Realtor or also get an unresponsive agent.
6) How much does Redfin charge to sell a house?
For first-time clients, Redfin charges a commission of 1.5% out of a home's listing price. For people who buy and sell a home through Redfin property services within a year get a discount rate of 1% only.
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