Redfin raked in +$540M in Q3 2021 and saw its losses decline as its iBuyer revenue picked up.
Redfin Had “Fantastic Quarter”
Redfin’s revenue soared +128% y/y during Q3 2021. The company also eased its losses while RedfinNow revenue grew.
In Redfin’s Q3 2021 earnings report, Glenn Kelman, company founder and CEO said Redfin, “had a fantastic quarter. The company took in $540M during Q3 while also reporting a net loss of -$18.9M. This -$18.9M loss decreased from the -$34.2M the company lost in Q3 2020 and down from the -$27.9M net loss in Q2 2021.
Kelman said, “Our revenues were at the top of the range we gave investors in our last earnings report, and our net income exceeded that range. Our year-over-year market-share gains continued even as the housing market slowed, and our website again improved its standing against its largest competitors.”
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Not Every iBuyer Program Exploded in Q3 2021
Kelman said that Redfin’s iBuying program RedfinNow saw its “…revenues grow by more than +1,000% all while selling homes above our forecasted price.”
Kelman explained that RedfinNow offers on homes during Q2 2021 were based on the idea that the market would slow down from its previous rapid price appreciation. “When other iBuyers were paying more, we were paying less.”
Kelman added, “RedfinNow could have gown to almost any size if we hadn’t been disciplined in what we pay for homes…We’ve just tried to figure out the right balance between scale and caution.”
Kelman Prioritizes Flexibility Over Scale
Kelman’s approach to Redfin and its iBuying program Redfin Now has always been “slow and steady.” Seemingly, he’s never been in a race to win…although just remember who won the race between the turtle and the hare.
Kelman said that Redfin tries to “err on the side of caution, because you have to in a balance sheet business. We’ve just tried to figure out the right balance between scale and caution.”
Kelman also stressed that Redfin is a diversified program, not favoring one business segment over another. Such diversification enables flexibility within the business because “…flexibility is more important than scale.”
Asked if Redfin is an iBuying company, Kelman said, “It’s part of what we do but it’s not who we are.”
Asked whether or not Kelman believes iBuying is “going away,” Kelman responded, “I just was on the Inman stage…saying it’s going to be between 1 and 10% of the market…but I’ve never said it’s going to be zero either.”
Thanks to Inman.
