Redfin’s recent layoffs caught my attention, not because of the job cuts themselves, but why they happened. Their explanation was telling:
“We’re hiring more Redfin Next agents (those on commission-only) and our current agents are becoming more ‘entrepreneurial and self-sufficient’, so we need fewer support staff and managers.”
Translation: Letting agents operate independently is cheaper than paying salaries. It’s the age-old real estate dilemma: loosen control, cut costs, hope for the best.
For years, Redfin tried the ‘agent-as-employee’ model, prioritizing control over profit. Now they’re realizing what the rest of us have always known: sometimes a hands-off approach simply makes more financial sense.
But here’s the problem: ‘self-sufficient’ in real estate often translates to ‘unprepared’, ‘uninformed’, or even ‘unethical’. This isn’t always the case, but let’s be honest, it’s far too common.
And that chaos is a liability now more than ever. With regulators breathing down our necks and lawyers seeing dollar signs every time an agent messes up, ‘self-sufficiency’ feels like a ticking time bomb.
I’m hearing two types of stories from brokers lately:
- “We were prepared, clients are on board, the new regulations aren’t so bad.”
- “I can’t BELIEVE the foolish mistakes agents are making.”
Think the second story won’t impact the first? You’re kidding yourself.
So where do we go from here? Brokerages are leaner, cheaper alternatives are gaining ground, and teams are picking up some of the slack on training and oversight, but it’s not enough. The legal risks are sky-high.
For years, this industry’s chaotic nature actually protected it from disruption. How do you change something so unsystematic, irrational, and cushioned by fees that numb the pain of payment?
You don’t. It took lawyers and regulators to do what entrepreneurs couldn’t. They’re our kryptonite.
Agent incompetence and its consequences won’t disappear unless we make them disappear. That’s the opportunity here.
If you’re serious about this business, don’t take a laissez-faire approach. Fight the incompetence as hard as the regulators fight us. Become the leader this industry desperately needs.
