Redfin's Plan to Disrupt Real Estate
There's a revolution happening in the residential real estate market. Tech-enabled companies such as Redfin (NASDAQ: RDFN) and Zillow (NASDAQ: Z) (NASDAQ: ZG) are using their internet platforms to change the way people shop for homes. Notably, Redfin is helping people get better prices and pay less in agent commissions. In some metropolitan areas, Redfin will even offer to directly buy your house. The company is still in the relatively early stages of its long-term growth plan and is unprofitable, but there's a good chance it will be successful in transforming the housing market.
Redfin was founded in 2004 as an online real estate broker and went public in 2017. Today, the company operates one of the most popular websites for home shopping, redfin.com, which receives over 36 million monthly average visitors.
The company makes money by charging brokerage commissions on home sale transactions. It charges 1% to 1.5% to a seller to list a home compared to the standard 3% charged by traditional real-estate agents. The lower commissions translate into real savings for customers. Strengthening Redfin's value proposition is data showing that homeowners who list on its website sell their homes faster and for more money.
Source Fool.com
