Redfin experiences in Austin - buying or selling (Lakeway, Howe: short sale, real estate)

[eirenecat]

Curious what other's experiences using Redfin in Austin have been, either as a buyer or a seller. I've been doing some reading about their business model, and it seems like in a relatively hot urban market, if you don't need a lot of handholding, you could potentially save money using them. I have a friend who is a Redfin agent and has generally positive things to say about working for the company.

We have used traditional full-service agents for our last two home purchases and I have to say that neither time was what I'd call a great experience. I bought my first house using a very experienced agent (who now deals exclusively in high-end Lakeway and Lake Travis area homes) and our second house using a newer agent. The agent who sold our last home literally did not one thing to market it other than put a sign out in the yard. She even used pictures I had taken previously inside.

I've lived in Austin for 30+ years and know schools and neighborhoods in general better than either realtor we used. My husband is an attorney and is perfectly capable of reading contracts. I am wondering if Redfin's more "self-service" model might work well for us when Mr Eirenecat and I sell our current house and move closer in next year.

If you've had a Redfin experience, how was it?

[austin-steve]

A Redfin agent sold one of my listings a couple of years ago. I wasn't impressed. Seemed like a "Functionary" agent, and the buyer could have done much better in repair negotiations had they had someone like me who more aggressively seeks inspection offsets.

But I'm unimpressed by the majority of agents in Austin regardless or Broker affiliation, (because I'm a grumpy old veteran and most in fact are really, really bad). Our industry is unfortunately flooded with dunces.

So for a buyer who knows the drill and who won't be competing for a hot home or need any specialized assistance, and especially if you know your target neighborhood and the values, why not use a rebate Broker? I wouldn't say that for every buyer (such as our investor buyers who truly do benefit from expertise and experience and knowledge), but for what you're describing, why not?

[eirenecat]

Steve, thanks for the response--I always appreciate your insights. I haven't encountered any buyer's agents here willing to do rebates, and a friend of mine who asked about this when interviewing agents before her last home purchase got several sort of insulted responses when she inquired. How do you find one?

[Idlewile]

We sold in Austin with Redfin and our experience was stellar and seamless. Never had an agent work so hard on our behalf. I've written about here in the past.

[austin-steve]

Originally Posted by eirenecat

Steve, thanks for the response--I always appreciate your insights. I haven't encountered any buyer's agents here willing to do rebates, and a friend of mine who asked about this when interviewing agents before her last home purchase got several sort of insulted responses when she inquired. How do you find one?

I don't know which Brokers run a discount model anymore. There use to be 1% Realty - not sure if they are still around.

Frankly it's hard for a buyer agent to afford to give up a slice of the commission unless there is a pre-defined scope of effort agreed upon. I think even Redfin limits the number of showings (or I think I remember reading somewhere that they had to start doing that).

In The Millionaire Real Estate Agent book, agents are advised to budget a 43% profit margin before taxes and health insurance costs. So, for a $9,000 buyer side commission only $3,870 of those dollars will survive to the agent's bottom line income before taxes. If they've already given away 1% of a $300K commission ($3,000) then they make only $870. Solo Brokers with low/no overhead may have more meat on the bone to share, but most of us just don't need the business so will pass on people wanting a discount

It's also easier to shave some off a listing side than a buyer side, because of the difference in effort, although plenty of sales listings do turn into long slogs and/or nightmare ordeals.

I'd read the fine print at Redfin because I think they are smart about it and don't expose themselves to unlimited buyer side effort plus give a discount. If you're locked and loaded and just need representation and someone to guide you, then it's a good match I think to use a discount agent.

Steve

[FalconheadWest]

I was a referral agent for Redfin when they first came to Austin. I was ousted when Redfin decided to become a brokerage here and I questioned their ethics. Their website states they only hire the best, however, all the Redfin agents I met at the company party were either completely brand new to real estate or brand new to Austin and didn't know the areas. When I asked why brand new agents were allowed, the response was because they could mold them. But their website states top experienced agents? When I asked why they hired people who didn't even know the Austin area, the response was that they will learn the area soon enough as they meet people all over to show houses...

Just because I questioned things, they got defensive, and we parted ways. It's good to answer questions. You cannot pick your agent. An agent is given to you. They have specific listing agents and specific buyers agents. Plus, once you find the house, that agent was just the door-opener. You'll work with another agent during negotiations and another during closing...

If I wasn't an agent and was a regular person in the market, I would not appreciate being passed along from person to person. I would only want to work with one point of contact throughout... but that's just me.

Overall, Redfin has a very small market share. Discount buyer brokerages are hard to come by because buyer's agents are working harder than ever to get their buyer a house. Multiple offers and selling the same buyer 3-7 houses and only getting paid on one of them because of the competition. You should really look hard at the agent willing to discount their services because they're going to be working for next to nothing if it takes you multiple offers to secure a property, but maybe you're moving to a non-demand area.

[bpvarian]

We live in Austin and occasionally get serious about moving (we are in one of those phases now). My wife and I are a little in awe about how much agents make (commission wise) for their work ($30k each for helping us buy a million dollar house?). I don't know, i personally think that as the field gets flooded with agents, they will be forced to reduce their commissions. Frankly I a little surprised that the internet hasn't up-ended the industry already. However realtors have powerful lobby forces.

Any ways - we live in town, know pretty much the few square miles we want to be in, aren't in a hurry, and we're going to pick out the houses that we want to see as they come on the market (BTW, no matter who you use, the RedFin app is amazing and better than any other app we've seen or tried. We even had a real estate agent suggest to use to use RedFin app over her app because it was far superior). So we just need someone to open the house for us. the agents that came were generally poor, did no homework about the house or neighborhood beforehand, and literally where there to open the door for us - but that's all we really needed. After the home tours, we would often wait >24 hours to get comps, etc.

So in the meantime we found a great agent who was willing to match Redfin's commissions (given that we are low maintenance buyers and they would get the sale of our home (again, matching Redfin's commission's)). There is no downside to trying them out, but just know understand what some of the pitfalls may be. Not sure what your budget it, but at higher end budgets it is likely (IMHO) that you will find agents willing to drop their commissions to match RedFin.

[dogofthunder]

I used Redfin to buy a condo before I relocated to Austin, and the process was smooth. It was a short sale, so it took longer than a normal sale, but the Redfin agent handled it well.

I interviewed a Redfin agent here when selling our first Austin home, but wasn't as impressed with her presentation and knowledge of our neighborhood as compared to the traditional agent we hired.

We are using Redfin to buy our next place, and like our agent quite a bit. So far we've worked with him the whole way, and we were able to pick him specifically, since a colleague of mine had a great experience with him as well. We are buying from a builder, and chose Redfin to have some assistance along the way and get the rebate (the builder would not reduce price if we were without an agent).

In short: great if you're a buyer, not enough experience to give an opinion on if you're a seller.

[lzydogrnch]

I would interview a few agents including Redfin. Find one that you like and trust. Home buying and selling is stressful and a major legal, not to mention financial decision. Don't just look at the dollars, look at the competence. If I was hiring your husband I would care if he were competent not cheaper. Also it's possible to negotiate a lower commission on the selling end if you use the same realtor for the buying side. I have worked with Redfin agents with no problem, I've also had to track a few down, but that can go the same with regular agents as well. Trust is important.
(And using your old photos for the listing- no wonder you are hesitant, yikes!)

[eirenecat]

As an update, we interviewed an agent who is probably the top producer for our current neighborhood a week or so ago. She's like the impresario--she gets nearly all of the listings (she was the seller's agent when we bought our house) and is also superb at inspiring bidding wars and getting top asking price. My husband wanted to talk to her just to see how it went, and I was impressed by her knowledge and general acumen compared to our two prior agent sales experiences.

Without my even asking, she volunteered to drop her commission on selling our home to 1% if we used her, which was surprising to me--only if we used one of the buyer's agents on her team to buy our next house. Since our next house will cost at least twice what our current house does, that's a good deal for her but also a good deal for us, too. BPollard, seems like your supposition that at the higher end, commission drops are more likely is proving true.