Mr. Chaddles' Blog
May 15, 2020
The Redfin Scam
When it comes to false advertising Redfin takes the cake. Redfin advertises their standard listing fee as 1.5% but this is entirely untrue. A listing fee consists of the sellers side listing fee and the buyer's agent commission fee. Redfin advertises their standard listing fee as 1.5% but they usually recommend a 2.5% buyer's side commission, which comes to a total of a 4.0% listing fee. By them advertising only one part of the listing fee as their listing fee that meets the definition of false advertising.
False advertising is the use of false, misleading, or unproven information to advertise products to consumers. Redfin's misleading advertising tactics creates confusion in the marketplace among consumers. When a potential seller reaches out to a local real estate company and are told the company's listing fee is 4.0% they immediately say that they saw that Redfin only charges 1.5%! The company then needs to explain how Redfin doesn't actually charge 1.5% but none of this should need to happen as local real estate companies shouldn't be put into the position of needing to educate consumers on the misleading advertising tactics by Redfin.
But what happens when the buyer is not represented by an agent? Well this is where Redfin really misleads consumers. If they could say they do a 1.5% listing fee when the buyer is not represented at least it wouldn't be a total lie, but read their fine print and it says if the buyer is not represented the listing fee will be increased to 2.5%. That's not to mention that 95%+ of buyers in real estate transactions in Massachusetts are represented by an agent so the chances of even getting that are very slim. There is no 1.5% listing fee offered by Redfin and the chances of getting 2.5% is very unlikely. Again, this meets the definition of false advertising.
When choosing a real estate company to work with there are serious moral issues working with a Walmart style national conglomerate like Redfin whose business model for years has been to operate at a profit loss to drive small local real estate companies out of business so that they can take over the industry. But not only have they been doing that they have also been directly lying to consumers about what they charge. None of this is right.
Please don't ever consider doing business with Redfin and continue to support your local realty businesses. They'll do a much better job for you than Redfin would anyways.
Next week I'll talk about the newest real estate scam --- Ideal Agent. It's going to be a good one.
Mr. Chaddles Previous Blog Posts:
May 5, 2020: Rt. 1 North's Missing On-Ramp in Revere
February 12, 2016: Mr. Buttersworth Asks You to Adopt
February 9, 2016: Possibly the Most Amazing House Ever
February 3, 2016: 9 Famous Spite Houses Built to Annoy the Neighbor
February 1, 2016: Rare Mr. Buttersworth Sighting
August 9, 2012: Yesterday I'm driving Down the Street...
August 5, 2012: Real life Mufasa and Simba
August 5, 2012: Lower Pond at Breakheart
SEE ALL BLOG POSTS HERE