Redfin, the alternative to full service real estate brokerage companies, got a great public relations plug yesterday in a 60 Minutes segment Chipping Away At Realtors’ Six Percent: Lesley Stahl Reports How Realtors’ Commission Fees Are Under Assault
Hi-tech innovator Redfin goes up against National Association of Realtors. I ask this question yet again: Who is really handling NAR’s PR? Good grief. Even Wal-Mart has done a better job digging itself out of its pr hole as of late.
Competition is good for the industry, and innovation is even better. Redfin seems to be having success in their market and have ambitious plans to roll out their concept nationwide.
Its getting tougher For NAR to argue for the 6 percent commission as an industry when home prices have risen a lot more than that and services haven’t changed that much. NAR continues to put itself in the hot seat with no end in sight.
Redfin may have the math right, but I wonder whether the basis for the commission calculation is really apples and apples. In other words, with a non-traditional house marketing plan and some of their agents doing 8 deals a week, will the ultimate home sale be as high as that achieved through traditional channels?
I sincerely doubt it. I doubt that the average sales price achieved by Redfin will be as high as the average achieved by the traditional way of marketing a home so the saving money argument seems moot…for now.
The tangible market exposure for the property with Redfin is less (I know Redfin is inferring less exposure via NAR, but I don’t agree), but over time, and with continuing acceptance of new methods to sell homes, it may evolve into value parity. This new marketing concept won’t go away so traditional brokers need to take note.