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Why I Quit Redfin

By
Real Estate Agent with Better Homes & Gardens Premier VA 0225101026

When Redfin moved in to Northern Virginia, I was so excited.  At last, an innovative real estate model that benefits the consumer!  After completing their extensive interview process, I was invited to join as a partner agent.  This means my license remains with my broker, McEnearney Associates, but I would receive referrals from Redfin.  I was really looking forward to working with clients who would be willing to earn a rebate by doing a little leg work by finding homes through Redfin’s terrific search engine.  After all, 90% of home buyers begin their search on the internet.

Well, after a little over one year of receiving these referrals, I've realized that this type of real estate service is just not for me.  See, when I take on a new buyer we always meet in the office and review the home buying process.  I learn about the buyer’s goals, hopes and dreams and work diligently to make them happen.  When I receive a client from Redfin I am supposed to just hop in a car and go show them properties.  Redfin does not want me to inquire about anything at the initial contact.  So, if a buyer is looking for a condo and has FHA financing, I should be showing them only those projects that are approved by FHA.  But without asking, how will I know?

I have found that when you start showing homes with out providing the basic home buyer knowledge, it becomes frustrating to all parties involved.  Sure, I can show you 6 homes in two hours – but how do we know those homes will be a good fit if I can’t ask preliminary questions about your type of loan or loan amount?

 Also, theoretically, the buyer earns the rebate by selecting the properties on their own.  Well, if I don’t  “seek a property at a price and terms acceptable to the Purchaser” then I become a limited service agent.  Frankly, that is just not my style.   

So while I feel Redfin may be a good fit for some, a year of  “leads” has shown me it is not a good fit for me.  Such a bummer. 

Comments (74)

Travis "the SOLD man" Parker; Broker/Owner
Travis Realty - Enterprise, AL
email: Travis@theSOLDman.me / cell: 334-494-7846

hmmm - didn't know how Redfin worked. Don't think I'd be interested per YOUR reasons!

Apr 24, 2013 01:19 AM
Anonymous
Kelly Behrens

My experience with receiving any type of referral that results in me receiving a significant discounted commission is that it costs me more in the long term. 

Apr 24, 2013 01:42 AM
#56
Michael J. O'Connor
Diamond Ridge Realty - Corona, CA
Eastvale - 951-847-4883

I also was a partner of Redfin but my experience was a little different.  It was several years ago now but the way it worked for me was pretty much as a lead referral engine with a referral fee back to Redfin as well as a commission credit to Redfin.  The main reason that I stopped was that I was already too busy with other clients.  I'm not sure if they've changed their model significantly or if your state had different requirements.  Overall it wasn't a 'bad' source for me, just a little bit pricy.

Apr 24, 2013 01:48 AM
Adam Wiener
Redfin - Seattle, WA

Hi Heather,

My name is Adam Wiener and I run the partner program here at Redfin. Thanks for posting this so we have a chance to clear the air, because it sounds like we've had a little miscommunication. I apologize for the confusion!

We absolutely want you to ask your potential clients questions. When you reach out to them over the phone to schedule an appointment, get to know them. So however you got the idea that we didn't want you to get to know your clients, I am truly sorry!

That is never our intention. We completely agree that to deliver a high-level of personalized service that information is vital.

All that said, there are a few things we don't want you to do:

1) REQUIRE buyers who want to see a property to meet you in your office first. You can always throw it out there. I can imagine something like this, "One thing I like to do is meet with buyers in my office to help orient them to the market. If you're interested I'd be happy to schedule an appointment, but if you'd prefer to meet at the property that works too." If you're concerned about safety please meet in a public place near the property like a Starbucks for a few minutes, snap a photo of their license, and then head to the property.

2) REQUIRE pre-approvals prior to showing a home. You can ask if they have considered how they are going to finance their purchase but in general, I recommend waiting to the end of the first showing once you've built some rapport. It is just a more natural time so people don't feel like they are being treated like a dollar sign (even if you're not, the client comes with their own pre-conceptions). If the client brings it up, then that's great get them connected with a great loan officer or two, but don't wait for the pre-approval to schedule the appointment.

3) USE AN EXCLUSIVE AGENCY AGREEMENT: Please discuss agency with your clients and follow all required disclosure rules in your particular state. Most people, as you all know, don't understand agency too well and helping them see that as the buyers agent you work for them is a wonderful conversation to have. What we don't want is an exclusive agency agreement (or really anything other than the state mandated form) put in front of the buyer especially on a first meeting. You're more likely to scare off a new client than you are to protect yourself from being "burned" down the road.

We want you to inquire, inform, delight, and serve your clients to the best of your abilities. What we want to avoid is anyone feeling like a dollar sign, having a sense of obligation, or being treated like a "lead" (that's a four letter word) rather than a person.

It may require you to switch up your normal rhythm a little bit - adapt your buyer presentation to something you can do between properties in small chunks, or invite them to have a coffee with you after the showing. Clients you meet over the internet have different expectations than folks you meet through your sphere or even at an open house and convenience is king. We've analyzed more than 10,000 home-buyer surveys and had countless focus groups to land on these policies that balance the consumer's desires with the agent's ability to deliver great service and meet all of their fiduciary and legal obligations.

Hopefully this helps clear up any misunderstandings

Best regards,
Adam

Apr 24, 2013 02:00 AM
Ron Buck
The Ron Buck Group - Laguna Niguel, CA
Associate RE Broker at Keller Williams Realty
My last involvement was to sell my listing to a buyer that came to an open house twice and picked my brain. Thought something was fishy when they would give no contact info. They eventually did close on my listing. Their "agent" never saw the property and a newbie agent who did not know the buyer or the neighborhood was present at the inspection. Soooo happy to let Redfin use my listings and hard work to skim off the cream of the industry.
Apr 24, 2013 02:23 AM
Michael Layton
RE/MAX Desert Properties - Palm Springs, CA
Experience and Trust

Hi Heather,

Thanks for sharing your story.  I think that different business models offer the consumers a choice. Choices I may not understand but they are out there.  I personally never go to the big wharehouse stores. A few of my friends swear by them but I so rarely have the need for 5 gallons of mustard or 10 toothbrushes it just does not work for me.

My experience after 12 years of doing this is that the clients who walk up to me, shake my hand, look me in the eye, tell me what they are looking for and are respectful of me as a professional are the ones that I will enjoy working with and who will actually close.  All the others are just big question marks. 

Thanks again for sharing.

Apr 24, 2013 02:51 AM
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

What an interesting discussion! It looks like Redfin needs to do some work on communication - since Adam (#58) says what you were led to believe is NOT their policy.

Apr 24, 2013 04:11 AM
Ric Mills
Keller Williams Southern Az - Tucson, AZ
Integrity, Honesty, and Vast Real Estate Knowledge

Good information from all.  I am so far not a Redfin Realtor as i don't need theri leads.  But never say never.  i also have a standard way for working with clients and always want to meet them at the office first.  Gte to know then and see if it is a good fit.

Apr 24, 2013 04:38 AM
Kasey & John Boles
Jon Gosche Real Estate, LLC - BoiseMeridianRealEstate.com - Boise, ID
Boise & Meridian, ID Ada/Canyon/Gem/Boise Counties

Did you actually end up closing any of the buyers that came from redfin or was it just a bunch of frustration? -Kasey

Apr 24, 2013 05:21 AM
Kimo Jarrett
Cyber Properties - Huntington Beach, CA
Pro Lifestyle Solutions

Adam, #58 from Redfin discloses their business model that many agents adopt, however, that's their business model and it depends on your business area if it indeed will work effectively, won't it? Your business is your time, so would Adam use up 6 hours of his time to hopefully sell a prospect on the merits of Redfin, would you?

What's the conversion ratio to time used to close? Your time must be used wisely, productively and effectively and getting all the information you need prior to spending time previewing properties is a more efficient way of doing business in my opinion, regardless of the business.

Apr 24, 2013 08:01 AM
Jeff Fisher
PureWest Real Estate - Whitefish, MT
PUREWEST REAL ESTATE/Christies
Thank you for the insightful post. Not that familiar with Redfin but they are in Arizona so it's good info to have.
Apr 25, 2013 02:40 PM
Lyn Sims
Schaumburg, IL
Real Estate Broker Retired

I often thought it was a bad business model more like a revolving door. Not good for the agent, not good for gas savings as you are driving all over the planet.  I did notice something different in your comment rather than saying website you said 'search engine'.  I'm sure that they 'WISH' is was google or even MSN.

Apr 26, 2013 02:11 AM
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

I had never thought of it in that perspective.  I do pay referal fees and assumed it would be a similar situation.  Did not consider the other bagage.

Apr 29, 2013 08:14 AM
Brad Baylor
ERA Coup Agency - Milton, PA

Heather - I made up my mind to not use any service where I have to pay for referrals.  Perhaps someday I'll change my mind, but for now, no way!

May 01, 2013 11:58 PM
Debbie Cook
Long & Foster Real Estate, Inc - Silver Spring, MD
Silver Spring and Takoma Park Maryland Real Estate

Wow, I didn't know you could handle Redfin customers while being lic with another broker.  I was approached by Redfin before to do this, but just did not understand it.

May 05, 2013 11:13 PM
Pete Xavier
Investments to Luxury - Pacific Palisades, CA
Outstanding Agent Referrals-Nationwide

Interesting, did not know the details about how things worked with them.

Very informative.

May 24, 2014 12:03 PM
David Popoff
DMK Real Estate - Darien, CT
Realtor®,SRS, Green ~ Fairfield County, Ct

What a great post and comments regarding Redfin, of course the model works for some and not for others, Thanks.

Oct 14, 2014 11:02 PM
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

The clients seem to be better educated prefer to search themselves.  They use RF due to flexibility with a good tech based tool.  They like the rebate.  The downside is they have limited means and can not offer top dollars in a highly competive market. Many offers come in lower than name brokerage. This means the agent has to show more homes to get the conversion rate up. When you have to split your earning to both RF and clients. There is little left over for the buyer agent.

Dec 11, 2014 01:43 AM
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

On the seller side it may be OK to use them for selling on average homes or condos. There are discount brokers and are professional enough.  The downside is one is not dealing with local marketing.  If I have an estate to sell. I will not considering them.  

Dec 11, 2014 06:25 AM
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

I think, the redfin agents customize their approach. I worked with R. listing agents and buyer agents, some are really great, some are terrible. Every business has a similar ratio of professionals with different skills and mindset. I personally prefer working with a small boutique broker these days and choose my own clients( usually referrals). 

Jan 11, 2022 07:16 PM