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.

CBS 60 Minutes “Hi-Tech Real Estate Moves In”


  1. Jennifer Steck May 16, 2007 at 8:42 am

    The competition will continue, as it should, in an open market. What will separate the professionals from the pretenders is the service they provide to the clients. Buying or selling a home is serious business since it is one of the largest investments that most people will ever have. I would rather pay more to get it right with a professional than to make a mistake that might cost me thousands.

  2. Long Island Lost May 16, 2007 at 9:55 pm

    Jennifer raises an important point. But, what responsibility does a Realtor have to me as a buyer? In practice (one purchase, one sale, two rentals), the answer seems to be none. If I was concerned I would hire a lawyer who at least has some legal obligations to protect my interests.

    Has a Realtor ever been successfully sued for malpractice?

  3. Robert May 17, 2007 at 5:46 pm

    Has anyone seen the quote by Buffet saying it is time to get back into realestate?

  4. Cary Collier May 24, 2007 at 11:31 pm

    Thank goodness someone is getting the word out!! My response is at as it is a little long. Congrats Redfin!

    There are many of us out there who do an excellent job and to answer the question about what a Realtor owes to a buyer will depend on state laws where the buyer is buying and the agency relationship.

  5. Bill June 7, 2007 at 4:23 pm

    Has a Realtor ever been successfully sued for malpractice?

    Are you Kidding???

    Almost Everday there is some Scam artist taking advantage of the Realestate market where the Real Eastate Agents are sued for duing their Jobs… I don’t know what the Laws are in your Backwater Wild West of a State where you live But…

    In NJ you sign a Legal contract With the Real Estate Agent if the Agent does not perform their fiduciary obligation to the Party that they are representing then you can and will sue…
    Get a Clue will you people… Fines and Lawsuits are as commonplace as Speeding tickets in the industry.

    What is this Realtor talk anyhow NAR is A Members Only Club not all Real Estate Agents are members.

    What the Hell is Redfin Doing for the Client anyhow?? Putting a Classified ad on the Local MLS??? giving you a Spot on thier website??? Shoot… why give them $3,000 and 1% of anything they make you do all the Work No Open Houses (just let your wife and Kids show it to strangers alone) You print your own Precious Fliers…. What sells A house and any house is what has always sold every house…


    undervalue a home in any market will get it sold no matter where you are or live..

    And Finally if your contract witha traditional Agent ends who pays for all the Advertising MLS fees, Virtal Tours, Slideshows, Photography, Mailers,Website Costs, Yahoo, Google, and fees,Openhouses, Broker opens, Caravans and the Agent for all the Time they invested into your home???? No one…
    It is just part of the Business the Agent and the office eat all costs. But Redfin Gets $3,000 no matter what happens

    What a Bargin

Comments are closed.