Redfin Direct, a new pilot program from the real estate brokerage, allows homebuyers to make their purchase without an agent. Launched in Boston in March, the program seeks to add more consumer choice, especially for first-timers.
Glenn Kelman, Redfin CEO tells MarketWatch, “We’ve been asked by many sellers, what if someone who wants to buy the house isn’t represented? Do I have to pay the fee? We’ve said no, but we haven’t made it easy for that to happen." Buyers “can hire an agent if they want a consultative relationship,” he said. Buyers using the service are vetted via questionnaire to assess their readiness to buy, and commission fees are removed from the equation.
The program works like this: homes listed by Redfin in a market where the program is available get a banner ad on the online listing explaining that the home can be bought “online without an agent.” The listing agent, or person representing the seller, will be paid the standard Redfin commission, which is either 1 percent or 1.5 percent of the sale price of the home. Redfin Direct calculates 2 percent of the asking price of the home, which is the average of what a buyer’s agent might expect to be paid. That amount is split between buyer and seller, saving both money, Redfin says.