Redfin vs Real Estate Agent: Making the Right Choice for Your Sale

Homeowners have more options than ever when it comes to selling their properties. They can hire traditional real estate agents, work with iBuyers, or use services like Redfin once they are ready to move.

Each option comes with benefits and drawbacks depending on the specific life situations and needs of sellers. 

This guide will offer a deep dive into Redfin and how it works so you can decide if working with this company is right for you. See how Redfin stacks up against traditional agents and discover the pros and cons of each choice. 

Make an informed decision when choosing between Redfin vs. real estate agent options. Here’s what you need to know.

What is Redfin and How Does it Work?

Redfin was founded in 2004 in Seattle, Washington. It was originally launched to disrupt the real estate industry by using technology to streamline the home-selling process. In the 20 years since its inception, Redfin has altered its business model to account for the needs of customers and changing trends in the real estate market. Today, it is known for offering home sale alternatives to sellers who might not want to hire traditional agents.  

At present, Redfin pays its real estate agents an annual salary with opportunities to earn bonuses. This is immediately different from traditional agents that are paid based on commission. Customers who use Redfin typically aren’t assigned a single agent. Instead, Redfin takes a team-based approach. Different real estate experts work together to list, market, and sell your home. 

Redfin also continues to highlight its technology, platform, and digital tools. Its primary goal is to stay a technology company that disrupts the real estate industry. This might appeal to some sellers who are looking for different options, but could deter some homeowners who would prefer a conventional real estate agent and closing process.

Pros and Cons of Redfin

Every choice in the real estate process comes with pros and cons. If you are considering using Redfin, here are some benefits and drawbacks that you should be aware of. Choose the path that is right for your needs and makes the home sale as easy and profitable as possible. 

Advantages of using Redfin

• Sellers can save money. Redfin charges sellers a 1.5% fee to sell the home. This is lower than the traditional 3% fee that many listing agents charge.  
• Customers gain access to Redfin Concierge tools and resources. Redfin prides itself on its technology. Customers might enjoy the insights they receive from this company. 
• The home sale process is streamlined. The Redfin partner agent program makes it easy to contact a Realtor whenever you need support. You have a whole team ready to help you out. 
• You can also use Redfin to buy your home. Redfin incentivizes sellers to use its service when they buy their next home, offering even more savings opportunities.  

Disadvantages of Redfin

• Redfin is not available everywhere. You might not be able to use this service in your area. 
• Redfin services are limited. Many traditional agents try to go above and beyond for clients. Redfin teams have a specific list of services they offer. 
• You need to work with Redfin buyer’s agents to maximize savings. This means you might not get to work with your ideal buyer’s agent.
• Redfin agents handle bigger workloads. You might not receive as much dedicated time from a Redfin agent because they typically juggle more clients at the same time.
• You might not get the maximum price for your home. Redfin agents might be more focused on selling your house quickly instead of at its highest possible price. This means you could leave money on the table.
• You don’t work with a dedicated agent. Hiring a trusted real estate agent is essential for feeling confident in your home sale. With Redfin, you work with a team, and different agents support you throughout. 
• There are varying agent experience levels. You won’t be able to interview multiple real estate agents to choose the best one. This means you might work with inexperienced Realtors who aren’t familiar with your market.

Cost Comparison: Redfin vs. Traditional Agents

At first, Redfin looks like a deal. A 1.5% fee structure seems like a low amount, and any savings during the real estate process in valuable. However, it’s important to have a complete picture of the cost structure of Redfin to confirm your total savings. 

Sellers will pay a 1.5% commission to Redfin and will also likely cover the buyer’s agent commission. This is often another 3%. This means the total commission fees paid by the seller are 4.5%. 

A 4.5% commission is still lower than the 6% commission that many sellers pay (3% to both the listing agent and buyer’s agent). If you sell your house for $400,000, a 6% commission will cost you $24,000, while a 4.5% commission will cost only $18,000. Additionally, if you hire a Redfin buyer’s agent for your next house, the fee drops to 1% for a total cost of 4%. This means you would only pay $16,000 in commissions. 

These savings are impressive, but you need to make sure you have the full picture of costs and fees before you agree to work with Redfin agents. Make sure there aren’t any additional fees and add-on service costs that could pull from your prices. 

Additionally, you might be able to get similar savings levels by negotiating with traditional real estate agents. If your listing agent agrees to 2% or 2.5% commission and the buyer’s agent accepts a similar rate, then you are still only paying close to 4.5%. You also might get better service from working with traditional agents, which means your home sale (and therefore your profits) are higher.

Service Level Comparison Between Redfin and Real Estate Agents

You get what you pay for in real estate. Saving money when hiring real estate agents might cause you to receive fewer services than you expect and potentially receive less money for your home. There are plenty of flat-fee agents that offer discount alternatives and opportunities to save on commissions. However, this also means you receive less personalized service and care. 

Redfin believes that its team-based approach improves communication with buyers and sellers. It means there is almost always someone available to answer questions or address concerns. However, not having a dedicated agent comes with drawbacks. The Realtors you speak with might be less familiar with your home sale, and you could potentially get conflicting advice from different real estate professionals. 

Traditional agents pride themselves on their personalized service and dedication to their clients. They have large networks in their communities and build relationships with mortgage lenders, home inspectors, and contractors. Hiring a traditional Realtor can help you receive the attention and help you need during the selling process. 

The local real estate market can also determine the type of agent you need. For example, in a hot seller’s market, your listing might receive multiple bids within a few days. You might be able to work with a flat-fee Realtor because selling is easy. However, if your house is less likely to sell immediately (either because of the market, neighborhood, or condition), you might want to hire a traditional Realtor. They will be able to use their knowledge and resources to get creative with your home. They can also develop creative marketing strategies and use more time to promote the property than Redfin would allow.

Pros and Cons of Traditional Agents

There are multiple benefits of working with traditional agents from a local real estate brokerage. However, this option isn’t for everyone. Here are a few pros and cons of going the traditional route during the buying or selling process. 

Advantages of Traditional Agents

• You will receive personalized service and attention. You will have a single traditional Realtor to help you sell your home. Any other real estate representative will likely be an assistant or partner at the brokerage.  
• You can tap into local market expertise. Experienced local agents have deep knowledge about specific neighborhoods, housing trends, schools, and amenities. This makes it easy to promote your home based on what potential buyers would want out of the area. 
• They take a relationship-based approach. Instead of a tech-based approach, you can form a lasting partnership with your Realtor. Your Redfin agent won’t be able to provide as much care. 
• You can use their negotiation experience and flexibility. Your traditional Realtor doesn’t necessarily want to sell your house fast. They want a quick transaction, but also want to maximize your profits. This means they will use their negotiation skills to help you get a deal. 
• You can choose a new real estate broker if you need to. There are other real estate agents to hire if you aren’t happy with your first choice.

Disadvantages of Traditional Agents

• You will likely pay higher commission costs. Not all real estate agents are willing to negotiate their fees. You might pay more in commissions. 
• Traditional agents vary in service quality and experience levels. You will want to interview at least three Realtors to choose the best one. Find an agent that meets your service quality and experience expectations. 
• They vary in technology adoption. Ask potential agents about the technology they use throughout the real estate transaction. Some might be more tech-forward than others.

Who Should Hire a Redfin Concierge Agent?

The ideal customer who hires a Redfin agent or works with a team from Redfin will want to maximize commission savings. This service is ideal for budget-conscious sellers who want a fast real estate transaction. Working with a Redfin partner agent is also ideal in hot markets where houses are likely to sell fast. In this case, sellers don’t need as much personalized service and will still be happy with the final sale price. 

Working with a Redfin agent might also be a good call for tech-savvy buyers. They might appreciate the resources and digital tools, making hiring this company worth it. Working with salaried agents might also be preferred by some people who don’t want to worry about commissions.

Who Should Choose a Traditional Realtor?

The majority of home sellers will benefit from working with traditional agents for their home sale. Standard real estate agents can modify their marketing strategies for unique properties, whether they need to sell luxury homes or distressed houses. Along with pivoting their plans, real estate agents can allocate more time to special properties that might be harder to sell. This can take a lot of stress off the seller who is worried about the real estate process. 

First-time sellers might also prefer to work with traditional agents. A conventional Realtor will provide more guidance and might even pair the homeowners with resources offered by their real estate brokerage. Selling for the first time can be just as overwhelming as buying, and local agents know what these homeowners need. The closing process can be easier with the right team working for you.

How to Choose Between a Redfin Agent and a Traditional Agent

Each home sale is unique, which means there may be some times when working with Redfun is the better option compared to traditional real estate agents. Use this checklist of questions if you aren’t sure what to choose. It can help you understand your individual needs and the needs of your home.

• What does the local market look like? See if the market favors sellers. 
• Is there anything unique about your house? Could these unique features prevent the property from selling quickly? 
• Do you have a luxury price point? This means there is a smaller pool of potential buyers. 
• What is your ideal communication style? Make sure it aligns with any real estate agents you talk to. 
• How comfortable are you with technology? Redfin is known as a tech-forward company. 
• What are your financial priorities? While you might save on listing fees, you might also have a lower overall sale price with Redfin. 
• What is your time? Both Redfin teams and traditional real estate agents can sell a house fast. 
• How do you value agent experience? An experienced agent might not have been in the field as long as you expect. 
• What marketing strategies do you want from your Realtor? Most traditional agents typically offer professional photography, social media, and open houses in their service packages. 
• What is your ideal fee structure? Make sure you know exactly how you are paying.

Beyond Redfin, there are other ways to hire affordable real estate agents. You can look into discount brokerages or flat-fee MLS companies. However, savings on commission often mean compromising on agent quality. You can also forgo working with real estate agents entirely and list as For Sale By Owner (FSBO). This requires the most work, but can potentially offer the most savings.

Hire a Realtor Who Provides Personalized Attention and Care

The real estate process is complicated, whether this is your first time selling your home or if you are an experienced homeowner. While a Redfin agent will work quickly to close the deal, they might not be as tough when negotiating with buyer’s agents. While you will save money on commissions, you might not make as much in home profits as you would if you had hired other agents. 

Find real estate agents who work quickly while also trying to maximize your home sale. Turn to FastExpert to learn about some of the best real estate companies and agents in your area. This is a great way to review traditional brokerages and find local Realtors to interview before making a final decision. Review FastExpert’s directory of real estate agents and see how these candidates stand out over Redfin agent options.