Redfin Corp Stock Price, News & Analysis

Redfin's Q4 2023 report shows buyer's agent commissions averaged 2.37%, virtually unchanged from Q3's 2.36% when new NAR rules took effect, but down from 2.45% year-over-year. The analysis reveals diverging trends across price segments: commissions for homes over $1 million decreased to 2.17% (from 2.33% YoY), while those for homes under $500,000 rose to 2.46% (from 2.42% in Q3).

A Redfin-commissioned survey of 500 real estate agents found that 48% report stable commissions since the NAR settlement, while 43% noted decreases. Notably, 54% of agents reported increased commission negotiations with clients. Looking ahead, 75% of agents express concern about declining commissions over the next five years, with 51% expecting decreases in the next 12 months.

Redfin (NASDAQ: RDFN) reports that homes are selling at their slowest pace since the pandemic began, with properties taking 54 days to sell, up from 35 days in 2022. The market shows 5.2 months of supply, the highest since February 2019, indicating a buyer's market.

Pending home sales declined 9.4% year over year, the largest drop since September 2023. This slowdown is attributed to high housing costs, with mortgage rates near 7% and home prices up 4.8% year over year. The median monthly housing payment stands at $2,753, close to April's record high.

While extreme weather conditions are affecting buyer activity, the market may improve as mortgage rates slightly decrease from early January peaks and new listings increase by 2.2%. The median sale price reached $377,125, with active listings up 11.3% year over year.

Downtown Seattle's apartment rents increased for the first time in 17 months, rising 2.5% year over year to $2,000 in December, according to Redfin. This uptick precedes Amazon's January policy requiring staff to work in-office five days a week.

Seattle's rental market has seen significant fluctuations: median asking rent peaked at nearly $2,500 pre-pandemic, dropped to $1,399 in February 2021, surged to $3,118 in August 2022, and then declined 36% due to increased apartment construction. Among Seattle's inner neighborhoods, Capitol Hill saw the highest increase (+7.2% to $1,825), while Queen Anne and South Lake Union experienced declines exceeding 13%.

The overall Seattle metro area saw a modest 0.5% increase to $2,017. On the east side, downtown Redmond rents rose 4.3% to $2,350, while downtown Bellevue decreased 3% to $2,579.

Redfin (NASDAQ: RDFN) reports that U.S. housing market activity is experiencing significant headwinds, with the median monthly housing payment reaching $2,686 - the highest in nearly seven months. This surge is attributed to rising mortgage rates (7.04%) and a 5% year-over-year increase in median home sale prices ($378,144).

The market shows signs of slowdown with pending home sales down 10.1% annually, marking the largest decline in over a year. Homes are taking longer to sell, averaging 52 days on market - the longest span in two years. Contributing factors include extreme weather conditions, wildfires in Southern California, and new listings.

In Los Angeles, the recent wildfires have destroyed or damaged 17% of homes within the Palisades and Eaton fires perimeters, leading to a surge in rental searches. Online views of rental listings in Los Angeles County have nearly doubled year-over-year, while pending home sales declined by approximately 10%.

Redfin reports that renters now need to earn $63,680 to afford the median asking rent for a U.S. apartment, the lowest amount since March 2022. This represents a 0.4% decrease from last year and a 6.4% drop from August 2022, when the median asking rent was at an all-time high of $1,700.

Renters are earning more, with the median income for 2024 estimated at $54,752, up 5.3% from 2023 and 35.2% from 2019. The gap between renters' earnings and the income needed for rent affordability is narrowing, with the smallest difference in five years.

Austin, TX, is the most affordable metro for renters, with a median salary 25.1% higher than needed to afford the typical apartment. Providence, RI, is the least affordable, with renters earning 41.3% less than required. Rental affordability improved the most in Austin in 2024, where the required income to afford the typical apartment fell by 16.3% from the previous year.

Conversely, rental affordability worsened the most in Providence, RI, with a 12.6% increase in the income needed to afford the median rent. Other metros with significant year-over-year affordability declines include Virginia Beach, VA, Louisville, KY, and Baltimore, MD.

Redfin (NASDAQ: RDFN) reports U.S. home prices increased 0.4% month-over-month in December 2024, following November's 0.5% growth. The year-over-year price growth of 5.4% marked the smallest annual increase since 2015 and second smallest since 2013, according to the Redfin Home Price Index (RHPI).

Among the 50 most populous U.S. metro areas, 15 (30%) experienced price declines in December. The largest drops were in Tampa (-1.3%), Atlanta (-0.9%), and Miami (-0.7%). Conversely, the highest gains were in Pittsburgh (1.9%), Cleveland (1.5%), and St. Louis (1.3%).

Redfin Senior Economist Sheharyar Bokhari predicts steady price growth throughout 2025, citing insufficient inventory to meet buyer demand despite expected increases in sales due to pent-up demand.

Redfin reports that home prices rose year-over-year in all 50 of the most populous U.S. metropolitan areas in December, marking the first such increase since May 2022.

Cleveland saw the largest increase at 15%, followed by Milwaukee (14.5%) and Philadelphia (14%). In contrast, Florida metros experienced the smallest increases, with Tampa at just 0.5%.

According to Redfin Senior Economist Elijah de la Campa, even traditionally affordable areas like Cleveland are experiencing double-digit price hikes, partly due to a shortage of homes for sale. Home prices soared during the pandemic due to low mortgage rates but fell in 2023 as rates climbed. However, prices have rebounded as buyers adjust to higher rates and inventory. In December, the median home price increased by 6.3% year-over-year to $427,670.

In some areas, sellers are holding firm on prices, making it difficult for buyers to negotiate discounts. This trend is particularly pronounced in Cleveland, where local families are often priced out of desirable neighborhoods.

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The Palisades and Eaton fires in Los Angeles have caused significant damage to residential properties, destroying or damaging 14% of homes within the fire perimeters, totaling 6,354 homes. Of these, 5,449 (86%) were destroyed and 905 (14%) were damaged. Single-family homes represented 89% of affected properties, with 11% being multi-family units.

The impact has created intense competition in the rental market, with one property being bid up from $16,000 to $30,000 monthly. The fires have disrupted real estate transactions, with some buyers canceling deals and sellers opting to rent their properties to affected residents instead. The destruction exceeds Los Angeles County's annual single-family permit issuance of roughly 6,000, potentially exacerbating the region's existing housing shortage.

Redfin (NASDAQ: RDFN) reports that pending home sales dropped 4.5% month-over-month in December 2024, marking the largest decline since October 2022. The decline was primarily driven by rising mortgage rates, which reached 7.04% by year-end after hitting a low of 6.6% in early December.

Nearly 40,000 home-purchase agreements were canceled in December, representing 16.2% of homes under contract - the highest December cancellation rate since records began in 2017. Despite this, existing home sales rose 0.7% month-over-month to 4,317,683 units annually, the highest level since February 2023.

The median U.S. home sale price increased 6.3% year-over-year to $427,670, marking the biggest annual gain since February. New listings fell 1.6% month-over-month, while homes typically spent 49 days on the market - the slowest December pace since 2019.