By The Tim on November 10th, 2008 at 9:28 AM · 38 Comments
As the housing market has slowed dramatically from the heady boom years of 2005 and 2006, the number of discount real estate brokers has been on the rise. While Redfin made a big splash in 2004, and continues to be the discount market leader, as the market tumbles other competitors continue to crop up.
As recently as September, over a year into the local market decline, discount brokerage Findwell opened its doors, offering half-priced services for home buyers and sellers. Even more extreme is 500 Realty, which was launched in August 2007 and offers to refund 75% of the buyer’s commission.
With an ever-shrinking pool of home buyers (and therefore successful sellers)—just over 3,000 SFH and condo sales closed between all of King, Snohomish, and Pierce counties last month—the squeeze is on for real estate brokers of all stripes, discount or full service. I find it quite interesting to see how the different companies are dealing with the tight market.
Redfin is constantly improving their search technology (which is amazing), and recently announced a restructuring of their commission structure and services offered. Meanwhile, newcomer Findwell is doing their best to make headlines and get their name out there, and has declared a “customer service challenge” to Redfin. And of course regular readers of the comments here are aware of the ever-persistent guerrilla marketing campaign waged by Ray Pepper and the folks at 500 Realty.
Personally, I think there’s plenty of room in the discount real estate services market for some healthy competition like this. In a way, it makes sense that a slowing market and falling prices would bring out more low-cost competition in this field. Since sellers have already seen their paper equity take a significant hit, they want to save as much money as possible. For buyers, the old days of depending entirely on your real estate agent to find you a home are long gone, so why should they still be paying 3%? (And don’t try to tell me that “the seller pays” so the buyer’s agent is free, because only one person shows up at closing with a check—the buyer.)
Will companies like Redfin, Findwell, and 500 Realty have long-term staying power? I certainly hope so. Will they have a large enough impact on the overall profession to usher in the closing chapter for fixed 3% buyer’s and seller’s commissions? Time will tell…
Full Disclosure: Both Redfin and Findwell are advertisers on Seattle Bubble.
Categories: News
Tags: 500 Realty, discount brokers, Findwell, Redfin
By The Tim on November 6th, 2008 at 9:43 AM · 28 Comments
For those of you that have been waiting for Redfin to add the NWMLS Cumulative Days on Market to the information displayed on listings, your wait is over.
Redfin unveiled a bunch of new features today. Here’s a list of what I’ve noticed so far:
- Cumulative Days on Market displayed
- property type now broken down into:
- House
- Condo
- Townhouse
- Multi-family
- Land
- Other
- search filters added for parking
- filter out short sales from results
- include schools on results map
Nice. Redfin is definitely doing an amazing job of constantly improving their web property search experience. Has anybody noticed any other improvements?
[Update: Also definitely worth noting—Google finally added Street View for Seattle, and Redfin is right on top of it, with integrated Street View on the page of each individual listing. Sweet.]
In somewhat related news, as some readers have already noticed, Redfin’s eight market blogs have a new analytical focus, and a new contributor: yours truly. To start I’ll be posting once a week over on the “Sweet Digs” blogs, chart-ifying and commenting on all new sets of data provided exclusively through Redfin for all eight of their service areas across the country.
Swing on by and let us know what you think. It’s not intended to be a replacement or competition to the material provided here on Seattle Bubble, but more of a complimentary resource.
Categories: News
Tags: blogging, real estate search, Redfin
By The Tim on October 13th, 2008 at 5:00 PM · 45 Comments
It looks like the tough real estate market has finally caught up to our favorite local real estate search innovator and discount broker Redfin. From the corporate blog:
Today Redfin laid off roughly 20% of our employees.
Unlike other startups, our industry’s recession started a year ago, when home prices first plunged.
Since then, we’ve fought like starving animals, and with some success: while industry-wide transaction volumes dropped 33%, we grew revenues by nearly 50%. Traffic grew more than 300%.
Even a month ago, we were raising 2009 revenue projections. All our markets, now including Chicago, contributed profits.
But the past few weeks have seen a major reversal. As the stock market wiped out prospective down-payments, tours and offers dropped 30%. Transactions that were done came undone. October will still be pretty good, then we’re headed for a big dip.
Hence the layoff. Layoffs are painful for any company, but especially for a startup and especially, I think, for Redifn.
My condolences to those that were affected by this cutback. Here’s hoping that Redfin is able to pull through these tough times. I’ve always been a big fan of the services they provide.
Categories: News
Tags: Redfin
By The Tim on August 13th, 2008 at 5:00 PM · 32 Comments
Redfin rolled out some great new statistical features today that are definitely worth mentioning.
Automated market statistics broken down by city, neighborhood, or zip code, with charts showing inventory, price per square foot, and price reduction trends over the last year.
CEO Glenn Kelman announces the new features in a blog post today:
Redfin released a big, beautiful new version of its website last night. For the first time in years, there’s a whole new web page on the site — not just a map and a web page for each property on the map — but a set of graphs, pictures, charts, numbers showing all the pricing trends for each of the 9,000 neighborhoods, postal codes and cities Redfin covers. This is the good stuff, drawn straight from the MLS databases real estate agents use to list properties and the tax rolls that counties use to record sales.
It’s a big deal, because consumers have never had access to reliable real estate data down to the neighborhood level.
…
Now you can see what’s really going on with your neighborhood’s prices, right now: dollars per square foot, numbers of homes for sale, days on market, price reductions. We split out condos and houses because they’re priced so differently. The pricing graphs show listings and past sales separately, so you get a view of what sellers expect and what they really got.
He also takes the time to go through a few other new features they have rolled out for home shoppers, so definitely go check out his whole post.
To access the spiffy new statistics, just type in a city, zip code, or neighborhood into the Redfin search field, wait for it to populate the map, then click “View [the area you typed] Inventory & Pricing Trends” in the upper-left corner of the map.
These tools are a great resource for figuring out what’s going on in the “hyper local” real estate markets that interest you. Kudos to Redfin for coming out with such great resources for home buyers and sellers to track what’s going on in their own back yard.
Categories: News
Tags: graphs, Market analysis, Redfin, Statistics
By The Tim on August 8th, 2008 at 8:53 AM · 90 Comments
There has been some great stuff coming out of our Seattle-area “alternative” real estate businesses Redfin and Zillow this week that deserve to be mentioned.
First up, Redfin came out with a great paper called Seven Tactics for Real Estate Bargaining. Check out their blog post announcing the study here. They analyzed recent sales data from 9,053 single-family-home sales across three markets, including 2,446 in King County, looking for homes that sold for a large discount from the last asking price.
Many of the characteristics they identified in homes that sold for a large discount were exactly what you would expect, but it’s great to see some hard data to support your gut instinct when it comes to negotiating a good price on the largest purchase of your life.
Here’s their seven tips on where to look for a seller that’s seriously ready to negotiate, and who to avoid:
- Focus on Listings Unsold After 90+ Days
- Focus on Fixer-Uppers
- Back Off on Remodels
- Don’t Be Put Off by a Price Reduction
- Look for Homes Owned a Long Time
- But Don’t be Put off by Flips Either
- Don’t Expect Banks to Negotiate Much
Sound, data-driven advice for anyone looking to drive a hard bargain in today’s so-called “buyer’s market.” Check out the full report here (pdf).
Next up is a survey from Zillow that (like Zillow itself) is more entertaining than particularly useful, but is still worth a look. The results of their Q2 Homeowner Confidence Survey of 1,367 U.S. Homeowners showed that:
Nearly two out of three homeowners (62%) believe their home’s value has increased or stayed the same over the past year; however, the reality is that 77% of U.S. homes have declined in value.
They also blogged the announcement of their survey results here. Another amusing tidbit from the survey results:
Three out of four (75%) homeowners expect their home’s value will increase or stabilize in the coming 6 months. However, when asked about their local market, 42% think home values in their locality will decrease (compared to the 25% who think this about their own home).
Click to enlarge
So at least 39% of the people are delusional about the value of their own home over the past year, but only 17% are delusional when it comes to the value of their home in the coming year. Hey, at least it seems to show a slight trend toward recognizing reality.
(Glenn Kelman, Redfin Blog, 08.07.2008)
(Amy Bohutinsky, Zillow Blog, 08.06.2008)
Categories: Statistics
Tags: homeowners, price drops, Redfin, Statistics, survey, Zillow
I have a couple of RSS feeds from real estate sites that I use to monitor listings that might be of interest to me. They are targeted at a couple of neighborhoods, and focused on homes that are likely to be mid-century modern. Over the past couple of weeks, I had noted that the volume of new listings had really dropped off. I mean, there was almost no activity. I attributed it to the market slowing down – figured it was just a late summer phenomenon.
Then I checked them this morning, and was surprised to find five or six new listings on each. What was going on? So I headed over to Redfin to check to see what Seattle had in the way of new listings overall (side note: what did we ever do before Redfin!?). What I found there was pretty interesting:
- There were 108 new listings in Seattle yesterday, versus 123 in the last three days and 350 in the last week. The rate of new listings was double the average of the last three, seven, or fourteen day period!
- I figured this might be some sort of statistical anomaly – so I checked Bellevue too. It looks almost exactly the same:
Checked Tacoma too. Same story:
I’m not sure what might be going on. I thought that listings were more likely to come on to market early in the month, not late in the month – but they seem to have exploded on the last day of the month. I see three possible explanations:
- It’s normal. The drop off just reflects the fact that homes sold. (I don’t personally think this makes sense. Homes aren’t selling all that quickly, and I don’t think it would explain the big difference between the one and 3 day average)
- There was some sort of glitch in the feed from NWMLS and new listings didn’t get posted for a couple days
- What I initially surmised: that sellers had been waiting to see what happened with the Housing Recovery Bill and decided that since it was signed, it was a great time to jump back into the market.
What say ye? Any other perspectives?
Categories: Statistics
Tags: Bellevue, Inventory Surge, Redfin, Seattle, Tacoma
