Redfin is an open collusion scheme, meaning, brokers think its ok to use it.
The rosy scheme basically says: “Come work with us, we are not a competitor, we are your trusted friend and a partner.”
Name one other industry where this is an acceptable proposition between competitors. I can’t think of any other sector where such blatant public disclosure of consumer allocation would not raise an immediate response from the U.S. Department of Justice
Since 2004, Redfin Partner Program was the first online broker collusion scheme that scaled into tens of millions of US homes. People intuitively think that Redfin saves money, and it doesn’t — it costs money. 40% of all transactions originated by Redfin are farmed out to competing brokers.
“Yes. It’s not something we broken out into a lot of detail, but generally you should think of revenue from partner transactions as having very high gross margin because the cost to serve the customer mostly comes from the agent who does that, not someone from within Redfin. So again, we haven’t broken it out, but you can’t certainly use that assumption that as very high gross margin on the partner business and disentangle it using that.” This is Chris Nielsen Chief Financial Officer at Redfin openly admits in Q2 2021 earnings call that collusion with competitors is a “high gross margin” revenue source for the brokerage.
Redfin Partner Agents — HomeLight Partner Agents — Zillow Flex Partner Agents — Realtor.com-Opcity Partner Agents — Xome Partner Agents — Better.com Partner Agents — Rocket Homes Partner Agents — OJO Labs Partner Agents — Opendoor Brokerage Partner Agents
This is a like-for-like pattern of almost every single broker-to-broker collusion scheme on the Internet today, and it all begins with Redfin.
HomeOpenly operates under a firm context that these schemes are “per se” violations of the Sherman Act, brokers in collusion with other brokers.
In the long run, Redfin Partner Program and HomeOpenly cannot coexist. We coexist for now, temporarily.
All brokers must compete with one another. If some brokers choose not to do so, such allocation schemes will gain network effects at a great profit and will promote collusion more effectively because of the massive amounts of money involved.
This “rent-seeking” collusion issue remains as the core of “all evil” in the online real estate sector. In aggregate, this is, by far, the biggest real estate scam in history of all real estate because it is amplified by the network effects of the Internet.
Consumers pay for it with highly inflated commissions in the middle of a housing crisis.
#realtors #realestate #antitrust #kickbacks #shermanact