Redfin is a real estate service that provides a range of tools for those conducting real estate research. Most people use Redfin to conduct market research, utilizing the variety of tools they have available to find data on everything from the overall market to specific home values.
There’s no doubt that Redfin has some incredibly useful resources. They’ve put a lot of work into developing technology and providing information that they know their users want and need, and the tools they offer are helpful and, on the whole, accurate.
For homeowners looking to sell, Redfin offers a suite of services that range from home photography and 3D scans to signage and marketing help. Sellers are also told they’ll be able to work one-on-one with a real estate agent in their area, and that they’ll be able to earn an average of $2,800 more for their home than they would if they went with a traditional seller.
But how do these claims stack up? What are the benefits of using Redfin, and where could it improve? And are there better alternatives to Redfin? We’ll take a look at those questions and try to answer them.
What Does Redfin Offer Sellers?
Most people are familiar with what Redfin offers on the buyer’s side. You can search homes, gain access to accurate and relevant data, see 3D home tours, and book tourings. While these are all useful for the buyer, you might be wondering what Redfin has to offer on the seller’s end?
While there are many benefits that Redfin claims to offer sellers, the chief selling points seem to be the marketing they offer, the low listing fees, and the ability to partner with a Redfin agent. Let’s take a look at each of these in a little more detail.
There’s no arguing the fact that Redfin utilizes some pretty impressive marketing strategies. For one, they have 3D technology that offers interested buyers the ability to virtually walk through your house from the comfort of their home.
This can be beneficial to both shoppers, who can easily determine whether or not they still want to see the home in person or not, and to sellers, who don’t have to waste time preparing for a showing if the buyer decides they’re not interested based on something they could have seen in the 3D tour.
Another additional marketing feature that Redfin touts for sellers is home photography. If you have any experience in real estate at all, you know that home photography, just like any kind of product photography, is incredibly important.
Without stunning photos that showcase the features local buyers are looking for, you’re going to have a hard time competing on the market. As such, the ability to have professional photos taken and listed is an undeniable benefit.
Signage is another form of marketing that Redfin provides to its sellers. Clearly and visibly marking your home as being for sale will help those passing by to notice and, if they’re interested, stop by. It’s also a good way to confirm that sellers who found your listing on Redfin or another site are in the right place.
Low Listing Fees
One of the main components of Redfin’s model, on the seller’s end at least, is that you don’t have to pay the typical commission rates. Usually, the combined real estate commission rate is around 6%, with 3% going to the buyer’s agent and 3% going to the listing agent.
With the Redfin model, you only pay 1.5% or $4,500. In other words, you’ll pay the higher of the two. So, if 1.5% of your sale price is $5,000, then you’ll owe $5,000, but the lowest you’ll pay is $4,500.
This can provide substantial savings. For instance, if you’re selling a home in Los Angeles at the median sale price of $706,900, a traditional transaction would cost you around $42,414 in commission. With the Redfin model, you’d pay $10,603.50. That’s a savings of $6,389.50.
In Chicago, where the median sale price is $298,500, a traditional sale would cost you around $17,910 in commission. With Redfin, you’d pay $4,500, since 1.5% of $298,500 is below $4,500. That’s still a savings of $13,410.
It’s easy to see why this cost savings opportunity draws many people to the Redfin model.
A final benefit that Redfin offers sellers who list with them is the ability to partner with discount real estate agents. Utilizing these agents often means that you’re sacrificing the personalized, full-service attention you can expect from a traditional agent. However, it also means that you’ll be able to tap into some of the cost savings mentioned above and, in most cases, sell your home quickly.
Room for Improvement
While Redfin has some clear benefits and has done a great amount of work to keep up with the technological and customer service demands of the industry, there’s still a lot of room for improvement in their model, as well.
For instance, the lack of a truly personalized service package can often mean that busy agents who are overloaded with transactions aren’t able to spend as much time with you as you might like. Some customers have also reported that they worked more closely with representatives from their Redfin agent’s office than they did with the actual agent.
Another drawback is the lack of a full-service experience. Again, since Redfin agents work at a substantial discount, it’s almost impossible to ensure that they’re able to provide all the services you might expect from a traditional, full-service agent. They can help with the main details, but in-depth guidance and oversight are often reported to be lacking.
Customer reviews of Redfin have a few common themes. One is that, while they did sell their house, they felt a disconnect with the agent they were working with.
Another theme is that because the agent themselves wasn’t as closely involved in the process as they would have liked, certain oversights happened, such as mistakes in the paperwork.
Finally, customers felt that while Redfin’s model does a good job of hitting the main points and checking off the main boxes where home sales are concerned, the in-depth, personalized care and attention that many full-service agents offer was lacking, making the entire process feel a bit impersonal.
A Better Alternative
While Redfin has a lot going for it, Clever exists to fill in the gaps and provide an alternative solution to both the traditional model and the typical discounted real estate agent model.
Clever is different in a few key ways.
Lower Commission Rates
First, our real estate commission rate is $3,000 or 1%, which is a substantial savings over the Redfin model of $4,500 or 1.5%.
A half a percent, or $1500, might not seem like a big difference, but it can translate into thousands of dollars.
Let’s take the examples we used before. The Los Angeles home we discussed before would have resulted, traditionally, in a commission rate of $42,414. With Redfin, the seller would have paid $10,603. But with Clever, they’d only pay $7,069.
That means that with Clever, the seller of that home would have saved $35,345 over traditional commission rate and would have saved $3,534 over Redfin’s model.
The Chicago seller mentioned above would have paid $17,910 in commission with a traditional model and only $4,500 in commission with Redfin’s model. But with Clever, that same seller would only pay $3,000 in commission, translating into a $14,910 savings over the traditional model and $1,500 in savings over Redfin’s model.
Additionally, while Clever Partner Agents do work for a flat fee, they’re still full-service agents that work with you in the same exact way they would do had you come to them on your own. The only difference is that they’re working for a lower commission rate, which helps you maximize your profits.
You’ll work directly with your Partner Agent through the process and obtain the same personalized, expert advice you would have in a traditional setting, all while benefiting from the cost savings of the flat-fee model mentioned previously. Also, Clever Partner Agents will handle all the photography, staging, and marketing services you’ll need, so you’re not losing out in that area.
Finally, Partner Agents are verified top-performers in their market with excellent reputations and a solid history of doing top-notch work. We’re very particular about who we choose to work with because we want to ensure that when you list with us, you’re getting the excellent service you deserve.
If you’re interested in learning more about how you can save thousands over the Redfin model while still obtaining personalized, full-service guidance from a top-rated realtor in your area, fill out our online form and get started today.