I'm sure there's been more than enough said on this subject, and I'm a little late getting to it, but,
The recent 60 Minutes segment on traditional Realtor fees vs those of the new internet based real estate company Redfin, only served to misinform the public -through glaring omission- about the facts of what it costs to list your home with Redfin, and all of it to Redfin's immediate advantage.
You might expect Redfin, who only serves to benefit, to go along with this sort of thing, but one wonders, what's in it for 60 minutes.
here's an excerpt where Glenn Kelman of Redfin is explaining to a smiling Leslie Stahl of 60 Minutes, just how it works;
'....we’re able to pass on a lot of savings to them," he says. (them being the buyers) And he does mean "a lot" of savings. Usually, a seller's agent and a buyer's agent split the commission, so they each get three percent. But when Redfin represents the seller, it charges a flat fee of just $3,000, and that’s it. That alone drives the traditional agents crazy. But then, when Redfin represents the buyers, they give them money back'.
Kelman said that they charge $3000, and that's it. But that's not it.
They too tack on 3%, which they give the agent representing the buyer, just like traditional Realtors do. If Redfin didn't collect 3% in addition to their $3000 fee, they wouldn't have any money to refund to the buyer. So on the sale of a $500,000 house- with a traditional Realtor, the seller would pay a total of $30,000 in commissions- $15,000 to the listing agent, and $15,000 to the buyers agent.
With Redfin the seller would pay a total of $18,000 in commissions-$3,000 to Redfin, and $15,000 to the buyers agent. The difference between the two is $12,000, not $27,000, as portrayed - through glaring omission - by 60 Minutes.
And it's worth noting, that Redfin gets their $3,000 up front, whether or not your home sells.
And the seller gets to do most of the work and most of the selling.
So much for investigative journalism, and Leslie Stahl, and CBS, and where's Andy Rooney when we need him.