The real estate slump is still dragging the economy down, but real estate sites that can help people save money or cut down the time it takes to find a decent home are still hanging on. Today, regional online brokerage Redfin is expanding into parts of New York for the first time, including Westchester, Long Island, and Queens (Manhattan and Brooklyn still remain beyond its reach). And in California, it now covers Sacramento and the Central Valley. These will be added to its existing markets of Boston, Chicago, Seattle, Washington DC, Baltimore, and the San Francisco Bay Area.
More significantly, Redfin is adding up to 200 additional data fields thanks to last year’s settlement between the Department of Justice and the National Association of Realtors, which requires multiple listing services to make data available online and share it more broadly. Anything a real estate broker can tell a client can now be put online. Redfin CEO Glenn Kelman is now finding that traditional real estate brokers are more willing to hand over the keys to the kingdom. Depending on the area, Redfin will now list property details such as price history, the sellers’ mortgage history, cumulative days on the market, lot square footage, and will display addresses on a map. Other sites such as Trulia are also taking advantage of these relaxed rules.
Unlike Trulia, though, Redfin is not just a real estate search engine. It is also a discount brokerage trying to with agents and partners. Redfin is trying to rewrite the rules of the real estate industry. Instead of taking a percentage of a sale, it charges a flat fee to home sellers of either $5,000 or $7,000. And for buyers, it refunds up to half the brokerage fee. Traditional brokers don’t like this, but in this economy some of them are even partnering with Redfin.
The downside to being a brokerage is that Redfin’s site only shows listings for the regions in which it operates. Nevertheless, traffic grew 300 percent last year to 1.6 million unique visitors, according to Kelman. ComScore estimates only 324,000 U.S. visitors in March, 2009, but shows a similar growth rate. (Again, remember that Redfin listings are not national, so compare these numbers to a collection of local brokerage sites).