Ok guys, the ice has been broken. Please welcome our first contributor to the Open Mic series, Simon. Who wants the Mic next? Just email us your post and we’ll put it up.
Submitted By: Simon
There are a lot Redfin (or BuySideRealty) can learn from the success
of Ebay. Ebay’s success lies in the fact that it empowers ordinary
people. http://www.youtube.com/watch?v=Hlkxr06Qa_k I went to Ebay Live
one year; it was very touching to see ordinary sellers walk up on
stage and share their stories. How a mother was able to stay home to
take care of her new born baby by selling garage sale items on Ebay,
how one’s handicapped son found new purpose in life by trading on
Ebay. Redfin needs to do just that, put a human face to it, show how
stretched young couples were able to buy homes with the money they
saved. Waive the fee once for a while for those who are in need; offer
to plant a tree in front of Redfin buyer’s house/backyard; encourge
buyers to put up videos to share their success stories; enable sellers
to put up videos to showcase their house and lovely memories in the
house….
I am not affliated with Redfin nor the real estate industry. I am just
a young first home buyer amazed at how much housing price has
increased and grateful at the money Redfin refunds. I want to use this
thread for Redfin fans to brainstorm ideas.
Source: YouTube by Grassrootsinnovation
Thanks Simon!
Update: The author of this post asked us to use his name and not his email handle.
RedFin has a lot of opportunity, but really needs to position itself with the public and its peers. There are a lot of real estate agents that are seething because of their business model. However, if they can humanize their product offering they have a shot at being big.
RJ
4MySales.com A Simple System to Close More Sales
Comparing eBay to Redfin wrt a personal aspect isn’t a good one. eBay allowed the common folk to embrace a marketplace when they otherwise wouldn’t have had one. To make a transaction from the comfort of your own home with little effort. Redfin seeks to bring forth the American dream of everyone owning a home but at the same time saving one some money at the sake of agents and taking profit themselves. Redfin isn’t going to do any hard bargaining for you, they’re not going to out there to shop mortgage rates, give you advice on why this house vs that house or details on the neighborhood. At the end of the day they are selling you a home, wanting to complete the transaction, save you some money and pocket some change themselves. It’s not as potentially life changing as eBay enables. Afterall eBay is a marketplace platform for people to conduct trade in whatever goods you want to sell. Redfin is purely about buying/selling a home. If Redfin really wanted that human element they would bring together people who build and sell homes and figure out a way to market to all segments of the marketplace, rich or poor. At this point I don’t seem them subsidizing housing development, allowing buyers to submit stories on why sellers should sell to them (I don’t believe this works btw but people still do it, maybe on the odd chance sellers don’t care about money and go for the sob story). You want humanizing? Why not take a %age of savings that Redfin claims they are helping buyers save and donate it to subsidized housing for homeless or abused people in need of shelter and protection. Or how about contribute x hours to Habitat for Humanity in exchange for reduction in %age.
Look at it this way redshirt, both Ebay and Redfin brings buyers and sellers together, and a platform to complete the transaction. The best comparison is Ebay Motor. It doesn’t do any bargaining for you nor offer you any advice, but it helps you find a car inspectors, loan websites, transporters, insurers, escrow, etc. It assumes ordinary users are not dumb, they know where do the research. Ebay just quietly help facilitate the process. Now, if you think buying a car 3000 miles way over the internet without kicking the tire is crazy, think again. Look up EBay’s earning report, millions of dollars of its revenue is recognized from its Motor site. I personally know a friend whole bought a secondhand BMW on Ebay Motor.
Anythings that takes money from you realtors/flippers/developers’ pocket into the pocket of a single parent mother who tries to come up with enough down payment for a house is a life changing event. I don’t think Ebay asks seller to submit his tax return to see if he qualifies for listing fee reduction, but how much do you think Ebay, its founder Omidyar, its former president Jeff Skoll donates to the community?
Let me qualify: “According to Solomon Smith Barney, eBay Motors accounted for about 30% of eBay’s total gross merchandise sales (GMS) in 2003 (up from 12% in 2001); incredible still is the fact that eBay Motors went live around 2000.”
Compare to buying a car 5000 miles away, getting it inspected, insured, shipped then registered, the paperwork involved for buying a home becomes a piece of cake, not to mention Redfin has local agents to help along the way. Now don’t try to pull the scare tactic on me, unless a buyer agent can guarantee and insure that nothing will go wrong if I hire him. Redfin or Joe at the corner street who charges 3% for a ride on his Lexus, the chance of getting hit by a truck is the same.
Buying used car online and have it shipped to you?!! A lot of loco people out there… I browsed around, people are even selling their house on Ebay! http://pages.ebay.com/realestate/
Redfin can probably partner with Ebay…
Not sure how that works, let me know after you bought one
Great comments.
Here’s a question: If another broker could negotiate a better price to offset redfin’s rebate would you choose that broker over the redfin broker?
I would
And if enough brokers do that, Redfin will lower its price, that is the magic of competition. In the end consumers win. I just sent Meg Whitman an email about cilitate’s idea. It is funny how I get into this by stumbling into Greg and Marlow’s blog. Now the viral effect has kicked off…
Not bad Simon. You got 7 comments so far. That’s the magic of free speech and open dialogue.
Let me through another idea out. How about making bumper stickers for Redfin fans to put on their car, and how about running radio ads. I wonder what the reaction of a buyer taking the 3% Lexus ride would be when he sees the Redfin bumper sticker on the car ahead or hears the radio ad on the car stereo. He would be like “Ur, would you mind dropping me off at the street corner ahead?” That would be a hiliarious TV ad. Maybe one day Michael Moore will make a documentry on the multi-billion dollar real estate industry. selliusrealestate, wanna put one up on YouTube? Got some great materials here.
simon - hmmmmmm? seems a little bit out there, even for us. but, if you make that video, send it to us and we’ll look at.
-rdb.sellsius°
What’s the the attitude about taking a ride with your agent? If I’m new to an area, I do find it easier and less stressful to have someone drive me around (at least initially). It’s a ridiculous strawman to claim you’re paying 3% to ride in someone’s limo.
I think Redfin has a short future unless it stops the insults and clown antics and starts doing what this blog post states (humanizing the equation). Moreover, Redfin’s for buyers who want to do all the work themselves, and take on most of the risk. That’s a fairly small segment, at least right now.
Plus, as sellsius points out - if the main difference is money, I see no reason why smart traditional agents won’t just offer tiered service (1% if you do most of the work -> 3% for them to do everything), making Redfin nothing but a untested new business.
Again, I can’t claim that every agent will look out for you, but I’m pretty sure that Redfin won’t. They won’t take you to the house (well, you can pay extra, but I’m not sure that gets an agent to walk the place with you), they won’t catch anything you won’t (the seller sure won’t tell you), and if the deal sours, your back to square one. Not the end of the world, but there’s a reason their cost structure allows them to charge 1% (hint: you do the work - you take the risk)
True if you are new to the area, and agree that RedFin makes more sense for buyers than sellers. Note that Redfin does take you out on a free tour, albeit on a Toyota instead of Lexus
http://www.redfin.com/stingray/do/home-tours?direct-section=buy&rt=dcbn-htl
Even with an agent, buyers should still do the diligence. There is no guarantee that the deal won’t sour if you go with an agent. I think Redfin is more neutral than an agent who needs your commissions to pay rent and I think REdfin being an underdog will try harder to prove itself. If you are not happy with the Redfin rep, you can complain to his boss and he may lose his job. An agent from ABZ Realtor can screw you over and nothing will happen to him.