Redfin posts $597M in income, tops expectations, stays optimistic in unsure housing market

Redfin CEO Glenn Kelman. (Redfin Photograph)

Seattle-based on-line actual property brokerage Redfin surpassed expectations within the first quarter and expressed optimism about its prospects for gaining share in an more and more tough marketplace for house gross sales.

  • Income of $597.3 million was up 123% from the prior yr, exceeding the excessive finish of Redfin’s steering by $37 million.
  • Web loss widened to $90.8 million, from $35.8 million a yr earlier. Web loss per share of 86 cents was higher than the lack of $1.09 anticipated by analysts surveyed prematurely of the report.
  • Redfin bought 617 houses by means of its RedfinNow “iBuyer” direct house gross sales program, producing $380 million in income, with common income per house of $608,851. That was up from from 171 houses in the identical quarter final yr, with complete income of $93 million at a mean of $525,765.
  • Web site and app visitors rose 11% to about 51 million common month-to-month customers.
  • Redfin’s core brokerage enterprise generated $177 million in income, $6 million above the excessive finish of its steering, and up 5% from a powerful quarter a yr in the past.
  • Mortgage income fell to $2.9 million from $5.7 million a yr earlier. Nevertheless, the corporate says it’s on tempo to just about double the share of Redfin homebuyers who get a mortgage by means of the corporate since closing its $135 million acquisition of Bay Fairness House Loans on April 1, after the primary quarter was over.

Redfin CEO Glenn Kelman was so optimistic concerning the firm’s prospects for growing its market share that one analyst, Mark Mahaney of Evercore ISI, made the tongue-in-cheek suggestion that Redfin accompany his remarks with an inspirational musical rating on its subsequent quarterly convention name.

Kelman laughed and stated he preferred the thought. However after one other analyst questioned his optimism extra immediately, Kelman defined his outlook in additional element, saying that Redfin does count on a big lower within the complete variety of houses bought within the U.S. this yr vs. final yr.

“We’re nonetheless very cautious concerning the housing market total. However we expect we’re going to take important share as we progress by means of 2022,” Kelman stated, describing his feedback as “extra of a mirrored image of our enterprise and our capacity to progress by means of headwinds than anything.”

Rising rates of interest are inflicting some homebuyers to take a step again, he stated. However for others, he stated, the rise of distant work is altering the dynamics by making location much less vital.

“We now have people who find themselves trying in three or 4 totally different markets, every at a distinct value tier,” Kelman stated. This was the hallmark of an actual property investor, he stated, however now it’s typically “a daily shopper who’s fully agnostic about location.”

That gives “some buffer out there,” he stated.

“However there’s no query that there are headwinds, and there’s no query that the housing market goes by means of some sort of correction,” Kelman stated. “It’s simply that we expect stock will nonetheless be the primary situation besides in a handful of markets. And simply primarily based on our personal information about excursions and affords and mortgages and every part else, we expect we will beat the rap and preserve taking share.”

Shares of Redfin rose 2% to $11.56 in after-hours buying and selling, after falling 11% in common buying and selling Thursday previous to the earnings report.



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