Redfin Corporation - RDFN STOCK NEWS

Redfin Corporation (NASDAQ: RDFN) announced its second-quarter financial results for 2020, reporting an 8% year-over-year revenue increase to $214 million. Despite this growth, gross profit declined by 5% to $46 million, alongside a net loss of $6.6 million, improved from a loss of $12.6 million in Q2 2019. Operating expenses decreased 17% to $50 million, representing 24% of revenue. Notably, Redfin achieved a market share of 0.93% in U.S. existing home sales and saved customers $39 million. The company emphasized its rapid adaptation to COVID-19 challenges and growing online demand.

According to a report from Redfin, nearly 45% of homebuyers made offers on properties they hadn't visited in person, marking the highest rate since at least 2015. This increased from 28% last year, driven by factors such as health concerns due to the pandemic and heightened competition in the housing market. Moreover, 27% of house hunters sought to relocate to different metro areas, compared to 25% in 2019. Virtual home tours have surged by 243%, reflecting changing buyer behavior during the pandemic.

In June 2020, 19.9% of successful offers from Redfin agents waived the inspection contingency, a significant increase from 13.2% in June 2019. Similarly, 20.6% waived the appraisal contingency, rising from 17.4% last year. Bidding wars intensified, with over half of Redfin's offers facing competition. Record-low mortgage rates below 3% fueled buyer demand, while active listings plummeted by 20.7% year-over-year. Buyers are employing various strategies to enhance their offers, such as waiving contingencies, which can pose risks.

Redfin reports that home listing prices surged 13% to a record $328,500 for the four-week period ending July 12, 2020. Closed sale prices rose 6%, with sale-to-list price ratios hitting 99%. Homebuyer activity remained strong, with a 12% increase in home tours and a 33% rise in the demand index. Despite ongoing pandemic challenges, buyers are responding to lower mortgage rates. However, new listings are 5% lower year-over-year, exacerbating supply shortages.

The national median home price reached an all-time high of $311,300 in June, reflecting a 2.8% year-over-year increase, as reported by Redfin. Despite challenges from the coronavirus pandemic, home prices are on the rise, driven by strong buyer demand. Pending sales saw a 5.4% annual uptick, marking the first increase since February, while new listings fell 11.6%. Active listings also decreased 20.7%. The market remains competitive, with homes selling quickly and often above list price, indicating a sellers' advantage.

Redfin Corporation (NASDAQ: RDFN) will report its second-quarter 2020 results on July 30, 2020, after market close. A live webcast of the conference call discussing the results will occur at 1:30 p.m. PT / 4:30 p.m. ET. Investors can access the webcast on Redfin's Investor Relations website. An archived version will be available for three months post-call. Redfin operates as a technology-driven real estate company, offering brokerage and iBuying services, and aims to redefine the real estate market.

Home sales have surpassed pre-pandemic levels for the first time, with a 2% increase compared to January-February, as reported by Redfin. Despite rising COVID-19 cases, demand is driven by historically low mortgage rates, with the average 30-year fixed rate at 3.03%. Key indicators show a 10% rise in pending sales and a Redfin home-buying demand index 20% above pre-pandemic levels. However, new listings are insufficient, leading to a 29% decrease in homes for sale year-over-year, resulting in increased competition and rising home prices, with average sales up 7% to $310,000.

In June 2020, over 53.7% of Redfin offers faced bidding wars, marking an increase from 51.8% in May and 44.4% in April. The surge in bidding wars is attributed to low mortgage rates at 3.03% and a significant drop in home inventory, down 21.3% year-over-year. Notably, single-family homes had the highest competition rates at 56.2%. Boston recorded the most intense bidding wars, with 72.4% of offers encountering competition. The report underscores a competitive market despite economic uncertainties due to COVID-19.

The housing market in June showed signs of instability as pending sales fell by 8.2% year-over-year, contrasting a previous increase. After seasonal adjustments, the decline was 3%. New home listings decreased by 8.3% from last year, with active listings down 27%. Despite this, homes for sale are moving quickly, with 47% selling within two weeks. The median list price reached $330,000, up 12% from 2019. Mortgage rates hit a record low of 3.07%, but purchase applications fell by 2%. The outlook remains uncertain due to rising COVID-19 cases, particularly affecting sales in certain markets.