Redfin’s Bill of Rights Revisited
Posted on May 11th, 2007 by Jonathan Dalton
There are two old solutions to writers’ block known throughout the world of journalism to which I once belonged: writing a “three-dot bandit” column, a series of unrelated thoughts separated by ellipses, and revisiting a previously covered topic in the interest of updating your readers.
I’m shooting for the latter by revisiting Redfin’s so-called Consumer Bill of Rights.
Much was made of the company’s publicity stunt when it first took place; next-to-nothing has been written on the topic lately, primarily because the groundswell of support that Redfin (presumably) expected with its “with us or against us stunt” never materialized.
A whopping 11 agents and brokerages have signed on to the so-called Bill of Rights, which was less a manifesto designed to protect the real estate consumer than a carefully crafted validation of Redfin’s rebate-based service model.
Redfin recently expanded to the East Coast from its left coast base, which leads to one of two possible conclusions - the business model is succeeding, or there is no immediate end to the number of venture capitalists willing to toss their cash into the money pit.
The company’s model - giving buyers the right … nay, the honor! … of doing all their leg works themselves and rebating a portion of the commission a buyer’s agent would receive, is practicable only in bulk. It is little different than flat-rate listing companies who promise high levels of service at a reduced rate, even if that high-levels service often means the seller is on their own to market the house outside the MLS.
Can such a model be successful on its own without being propped up by investors willing to take the chance? That question remains to be answered.
Technorati Tags: Redfin, consumer Bill of Rights, real estate commissions
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I have not been paying attention. Where did they open on the East coast? So is 60 Minutes tomorrow a Redfin ad?
They went back east to Boston within the last month.
And my guess is it’s going to be a Realtor-bashing piece, with some complaints about competition and the purity of rebates thrown in.
If Glen’s the primary source … well, you have to know how it will turn out.