Earlier this week, Redfin announced a new feature on their website, the Scouting Report, where one can look up any agent by name, including Redfin agents, partner agents, and agents who are not associated with Redfin, and see their home sales and listings back to 2008.
Though this sounds like a good thing, Redfin routinely manipulates these figures for their own benefit and I’m guessing will continue to do so. If they did not believe that the Scouting Report will help them in their goal of market dominance, this feature would not be rolled out.
One will often see their agent stats touted on their websites and sent out in press releases “Seven Redfin Agents in the Top Ten in King County” or “Five Redfin Agents Rank in the Top 10 Boston Area Buyers Agents”, and this looks impressive.
The statistics are presented as accomplishments of individual agents, and if that were true, would indeed be notable. But is it accurate?
From their website and articles published online, we are informed that the company uses “field agents” to show homes. The Redfin agents who negotiate the deals do not ever visit the home they have sold. Is this good representation? Yet, these transactions are counted as sales for that agent.
Redfin agents who write up the deals have field agents to show the homes and transaction coordinators to track the sale, and other employees to arrange the inspections and reinspections, order title, open escrow, collect and deposit earnest money checks and the countless other tasks associated with a real estate sale. Yet this one agent is listed as the “sales agent” for the transaction. Is this really an accurate representation?
Aren’t we really comparing apples to oranges?
Most traditional real estate agents would do all of the tasks associated with a sale. They would preview all homes in a buyers selected price range and neighborhood (which is not typically what a Redfin agent does.) They would then show the most promising homes themselves, to the buyer. Again, Redfin agents don’t do this, they only show homes upon specific request.
When a traditional agent and buyer locate a home, that agent then draws up a contract. At Redfin, the buyer is passed off to a 2nd agent, one who has not seen the subject property, and that person prepares the contract and negotiates the sale. A 3rd agent might arrange for the inspection, and other agents and administrative people may do other tasks associated with the sale.
In a recent Redfin transaction I was involved in, 4 different agents accessed the property on behalf of one buyer, but none of those agents were the one who finally wrote up the deal. Yet that sale was attributed to the agent who wrote up the transaction, not the agent who showed the house.
How then is this an accurate accounting of that particular agent’s sales?
Doesn’t this mislead the consumer into thinking that their individual Redfin agent is more successful than they are? I think it does.
And ultimately, this Scouting Report has the power to do the same thing. It will compare traditional agents with the Redfin office staff agents who get all the credit for a sale, but who actually share that accomplishment with a dozen other support and administrative personnel.
For all their talk of transparency, Redfin should take their own advice instead of continuing to manipulate statistics for their own marketing purposes.
Redfin releases Scouting Report, the most disruptive online real estate play in years (1000 Watt Consulting)
Initial Thoughts on the Redfin Scouting Report (Phoenix Real Estate Guy)