Redfin vs Zillow: Company Profiles & Comparisons

Disclaimer: Company program details can frequently change. HomeLight always advises that you check a company’s website for the most up-to-date information.

Whether you want to buy or sell a home, you’ll find a wealth of helpful information online. At some point in your journey, you may be curious to learn more about the difference between Redfin vs. Zillow, which are two major real estate companies in operation today.

While both Redfin and Zillow have been around since the early 2000s and host similar types of information (such as for-sale listing details), their business models are not the same and their services vary.

In a nutshell, Redfin is a real estate brokerage as well as an iBuyer (instant home buyer) that purchases homes directly from sellers in select states. Zillow is an online real estate marketplace where people people can browse listings and connect with agents who advertise on the site.

Let’s take a closer look at Redfin vs. Zillow alongside some additional real estate websites that can assist with your real estate needs, such as HomeLight.

Company details* Zillow Redfin
Founded 2004 2006
# of employees 6,400 4,100
# of social followers 195,792 (LinkedIn), 2.4 million (Facebook) 83,345 (LinkedIn), 440,543 (Facebook)
Automated valuation model Zestimate® Redfin Estimate
Hosts for-sale listings? Yes Yes
Hosts rental listings? Yes Yes, as of March 2022
Hosts FSBO listings? Yes Yes
Brokerage status? Has brokerage licenses but does not hire agents Operates as a technology-driven brokerage
Known for Being a place to shop for homes and browse listings, proprietary Zestimate® Lower listing fees of 1%-1.5%, buyer rebates, salaried agents

Sources: Redfin LinkedIn, Zillow Facts and Figures
*Information collected as of May 2022.

What is Redfin?

Founded in 2004, Redfin is a technology-driven real estate brokerage that lists homes for a lower commission of 1%-1.5%. (Note: the listing fee Redfin charges does not including the buyer’s agent fee and is subject to a minimum dollar amount Redfin has set based on the market.)

Unlike most other brokerages where agents sign on as independent contractors, Redfin brings on licensed real estate agents as salaried employees who can also earn a transaction bonus for each closing.

Redfin also curates and posts real estate listings from a variety of brokerages that consumers can browse. Buyers and sellers can be put in touch with a Redfin Agent through the company website, whether they want to tour a home or ask a question.

Sellers who list with Redfin will see their house marketed through digital campaigns, have a 3-D tour added to their listing, and be able to track marketing activity on their home while it’s on the market.

Buyers may qualify to receive a rebate amounting to $1,500 on average when working with a Redfin Agent, subject to a number of conditions. As of March 2022, Redfin also hosts rental listings through is acquisition of RentPath in 2021. The company provides additional services and considers itself a title, lender, and home renovations company.

What is Zillow?

Zillow is a home search website that has been well-known brand among consumers for many years, to the point of becoming a household name in real estate. On Zillow, you can actively or passively browse real estate listings, connect with a real estate agent, or see your home’s “Zestimate”, an estimation of value that Zillow determines for your home based on a proprietary algorithm.

Unlike Redfin, Zillow does not have real estate agents who it employs to list or help buy homes on client’s behalf. Although Zillow has brokerage licenses in many states (which allows it to engage in certain real estate practices that may require such a license), Zillow does not operate as a traditional real estate brokerage with agents under its brand.

Instead, Zillow advertises real estate agents from other brokerages — whether it be Keller Williams, Coldwell Banker, or Century 21, etc. — on its site. As with many real estate platforms, the company accepts and places paid ads. It’s up to you to dig deeper to find online testimonials about their quality, talk to past clients, and request their sales data.

Landlords pay to have their apartments listed on Zillow (though their first listing is free), and if you’re looking for a rental — Zillow can be a good source. Zillow also connects you with mortgage lenders, providing information about rates and reviews of their services. The company doesn’t buy homes as an iBuyer, however. They used to, which we’ll touch on later in this post.

Need to Sell Your Home Fast?

RedfinNow is currently available in limited markets, and Zillow no longer offers iBuying services. Request an all-cash offer through HomeLight’s nationwide Simple Sale platform whenever you’re ready.

Redfin vs. Zillow: How are they different?

Here are some of the key differences you’ll see when taking a closer look at Redfin vs. Zillow.

For-sale-by-owner (FSBO) listings

Redfin does not enable users to directly upload a For Sale By Owner (FSBO) listing. However, if you’ve listed on Fizber or FSBO.com, Redfin says it will be able to display it as an active listing, according to a support page.

Zillow does have a feature that allows FSBO sellers to upload a listing directly to the site for free, and users can include video and unlimited photos. (Note: Only 7% of homes sold in the U.S.  were listed as FSBO, according to 2021 data from the National Association of Realtors.)

iBuyer services

Another major difference between Zillow and Redfin is that Redfin is an iBuyer (instant buyer) and Zillow is not. In case you aren’t familiar, iBuyers provide near-instant cash offers for homes, allow you to sell your home mostly or entirely online, and can facilitate much faster closings than a more traditional or financed buyer.

iBuyers can be a good option for people who need to sell a home quickly and don’t want to make repairs or prepare the property ahead of the sale. For example, a seller with an unwanted inherited house or someone moving for a job may prioritize a certain level of convenience that iBuyers can offer.

In addition to its reduced commission listing services, Redfin has an iBuyer program called RedfinNow. It was launched in 2017 and is available in select locations across 11 states as of this writing. Redfin sold 600 homes in Q4 2021, up from 388 in Q3. Sellers pay a service fee between 5%-13% to use RedfinNow.

Zillow once had an iBuying service, Zillow Offers, but it was shuttered in November 2021.

Revenue streams

Redfin and Zillow make money in different ways. According to Seeking Alpha, Redfin generates revenue from its listing fees, partner agents and referral programs, as well as through its iBuying platform RedfinNow (which charges service fees and may earn a profit on the upside of the sale). Other revenue comes from mortgage, title, Walk Score data, advertising, and other ancillary services.

By contrast, Zillow charges real estate agents who advertise on its site using a “pay per lead” model. Recently, however, Zillow has signaled a shift toward only charging agents if a lead transacts, at least in certain markets.

How are they the same?

Which services on Zillow vs. Redfin are similar? Let’s take a look.

Home value estimates

Both Redfin and Zillow provide home value estimator tools on their websites. Buyers could use them, too, to gather intel on whether they’re paying a fair price for a home. As of this writing, Redfin says its tool has an error rate of 2.4% for on-market homes, compared to Zillow’s slightly lower 1.9%. Review HomeLight’s guide on the top 8 home value estimators of 2022 and how they compare.

What’s Your Home Worth?

Home prices have skyrocketed over the past couple of years. Get a preliminary estimate of value from HomeLight in less than 2 minutes.

Listing source

Both Zillow and Redfin use IDX (internet data exchange), which creates connection between the MLS and a website, in order to display real estate listings to the public. Redfin says 70% of listings on its site are updated every 5 minutes; while we were unable to find a comparable figure on Zillow’s site, the update time is likely similar or the same. Zillow transitioned from using direct MLS feeds to IDX in 2021.

Mobile apps

Redfin and Zillow both offer apps with a variety of useful tools. View each one to see their different features:

Connecting with agents

Both Redfin and Zillow offer suggested agents on their sites. This agent could be a salaried employee (Redfin) or one in the site’s network who pays for the lead (Zillow).

While it would be easy to hire the first agent who pops on your radar from one of these sites, it’s important to consider the quality of the agent you ultimately end up working with.

Consider using HomeLight if you need to find a top-rated agent with positive reviews and a track record of success in your area. HomeLight’s agent suggestions are tailored to you and agents can’t pay to be listed, so you get the best match.

Find a Top-Rated Real Estate Agent

We analyze over 27 million transactions and thousands of reviews to determine which agent is best for you. Our service is 100% free, with no catch. Agents don’t pay us to be listed, so you get the best match.

How do Redfin and Zillow work for home sellers?

How would a home seller use their websites?

  • To find an agent to list their home
  • To research comparable home sales
  • To search listings for potential neighborhoods to move to
  • To find a reduced commission agent (Redfin)
  • Locate a temporary rental after selling a house
  • List your home for sale by owner (can do directly on Zillow, or through certain sites that partner with Redfin)

How do Redfin and Zillow work for homebuyers?

Both sites allow homebuyers to filter results, set up saved searches, and get notified of new listings. In a hot market, this could mean the difference between jumping on a new home listing right away and missing out. (However, a top real estate agent may have the biggest advantage, with the inside track on what’s soon to be listed in their brokerage).

Another key differentiator between the companies is the “Redfin Refund.” Buyers who work with a Redfin agent can receive a rebate on the agent’s commission at closing, on average $1,500 nationwide. However, this rebate isn’t legal in all states and is subject to lender approval and minimums.

Do Redfin and Zillow both serve your area?

Zillow operates nationwide. Redfin says it is a nationwide brokerage but some locations may be “out of area.” Services like Redfin Concierge or RedfinNow only operate in certain cities and states, primarily major metropolitan areas.

Is there a cost to use Redfin or Zillow?

The only costs for both websites are the commissions or listing fees you might pay to an agent you hire. Downloading their app, signing up for alerts, and asking for agent referrals are all free.

Redfin and Zillow Reviews

How do reviewers rate Redfin and Zillow? Reviews vary across websites, from poor to great*. When reading reviews, pay attention to which of the many services offered that the consumer is reviewing, as it may not be a service you intend to use.

Redfin review ratings

Trustpilot: 2.8 out of 5 stars, with 7 reviews
Consumer Affairs: 3.9 out of 5 stars, with 238 reviews
BBB: 1.7 out of 5 stars, with 36 reviews (C rating)

Zillow review ratings

Trustpilot: 1.7 out of 5 stars, with 221 reviews
Consumer Affairs: 3.8 out of 5 stars, with 559 reviews
BBB: 1.06 out of 5 stars, with 114 reviews (C- rating)

*Reviews as of May 3, 2022

Alternatives to Redfin and Zillow

There are plenty of websites in the real estate industry — from brokerage-specific websites to those that match you with an agent.

How does HomeLight work?

HomeLight offers several services and tools similar to Zillow and Redfin as well as programs that neither of the other real estate companies offer:

  • Home search: Browse listings in live markets.
    Agent Match: Connect with a top-rated agent near you in two minutes.
  • HomeLight Simple Sale: HomeLight provides a cash offer to buy your home, which allows you to skip repair costs, showings, and agent commissions.
  • HomeLight Home Loans: HomeLight Home Loans is a mortgage lender. Buyers work with a dedicated loan officer, and can get an underwritten pre-approval to strengthen their offer, and typically a 21-day close.
  • HomeLight Trade-In: Reduce the stress of buying and selling at the same time.
  • HomeLight Cash Offer: HomeLight buys your dream home for cash — increasing the likelihood of your offer being accepted — and then sells it to you.

*Some services are not available in all states

Additional tools and resources

  • Home Value Estimator: Get an estimate of your home’s current value.
  • Agent Commissions Calculator: Estimate how much you’ll pay in agent commissions on your home sale or purchase.
  • Home Affordability Calculator: Want to know how much house you can afford? Input some information about income and expenses and the calculator gives you a ballpark.
  • Net Proceeds Calculator: This tool helps you estimate the cost of selling your home and the net proceeds you could earn from the sale.
  • Best Time to Sell Calculator: Need to get top dollar for your home sale, or close quickly? Our best time to sell calculator analyzes transactions in your area to tell you when you’ll get the most money.

Redfin vs. Zillow FAQs

Here are some of the most frequently asked questions about Redfin and Zillow.

Which company is larger, Zillow or Redfin?

As of May 2022, Zillow’s market capitalization was $9.1 billion compared to Redfin’s market capitalization of $1,14 billion. Zillow also has more employees than Redfin.

Who started operating first, Zillow or Redfin?

Zillow was founded in 2004 (according to the company’s Facts & Figures page), and Redfin in 2006 (according to the company’s “About Us” boilerplate.)

Is Redfin better than Zillow?

It depends on why you’re using their websites and what your real estate needs are. If you’re doing research to sell your home, Zillow may offer a more comprehensive home profile. Zillow is also more well known for its home search capabilities.

If you’re trying to save money on a real estate agent’s commission, Redfin will likely be better. However, you should always do your research as there can be serious cons to working with a low commission agent.

Consider the advantages of using HomeLight to find an agent. We analyze over 27 million transactions and thousands of reviews to determine which agent is best for you.

Is Redfin or Zillow more popular?

Zillow ranks first in the U.S. for real estate websites, versus Redfin at sixth. Zillow had 36 million visits a month as of October 2021.

Next up: Selling or buying a home

It’s quite amazing to realize how much information about real estate is available online. You can find your next rental pad, investigate school rankings, and experience the beauty of a neighborhood you’ve never visited thanks to technology.

But if there ever comes a point where you get tired of the virtual world, you can always put away your screens and ask a top real estate agent for their professional opinion — you know, IRL.

Header Image Source: (Zac Gudakov / Unsplash)

Dena Landon

Source link