(GeekWire Photo / Nat Levy)
Redfin exceeded analyst expectations for the fourth quarter of fiscal year, posting revenue of $ 244.5 million, up 5% year over year, and earnings per share of $ 0.11. Wall Street expects sales of $ 235 million and earnings per share of $ 0.04.
A hot real estate market helped Redfin’s monthly active visitors record growth of 44.1 million from 30.6 million in the same quarter last year, an increase of 43%. The mortgage business increased sales by 210%.
Redfin ‘s shares stayed the same in over – the – counter trading.
For the full year 2020, Redfin revenue increased 14% to $ 886.1 million, while net losses decreased from $ 80.8 million in 2019 to $ 18.5 million.
Redfin pays $ 608 million to acquire RentPath, the owner of Rentals.com, Rent.com and ApartmentGuide
After a sharp slump in March, Redfin’s share price skyrocketed, trading at around $ 90 / share on Thursday. Shares fell 16% in October after Redfin announced a new offering of $ 575 million convertible senior notes. The company’s market capitalization is more than $ 9 billion.
Redfin and other real estate tech companies, including Seattle-based giant Zillow Group, are benefiting from a strong U.S. real estate market that appreciated nearly $ 2.5 trillion in value last year, the largest since 2005, according to a Zillow- Analysis.
Median sales prices are up 14% year over year, and the number of homes sold is up 12%, according to Redfin. Low mortgage rates combined with strong demand and supply – the number of properties in the market hit an all-time low last month – are driving the real estate industry’s tailwind.
“We were they The fastest growing major real estate website as home buyers moving to a new part of the country have increasingly turned to the internet to find a real estate agent, “Redfin CEO Glenn Kelman said in a statement. “Since then, more than half of all houses have been sold in the As a bidding war, our on-demand home touring has become a critical competitive advantage for our customers who want to see a listing either in person or virtually, before other buyers even know it’s for sale. “
In the company’s earnings statement, Kelman compared the real estate market to a “Soviet-era supermarket with most shelves empty.” He cited a Dallas Redfin listing that had 154 screenings and 32 offers. Redfin’s annual survey of nearly 2,000 home buyers found that 63% bid on a home without seeing it in person.
Another tailwind for Redfin: Home buyers are increasingly going online to find a real estate agent.
“We have a very high priority in these searches and offer convenience at the touch of a button,” said Kelman. “People can say, ‘Look, I just want to see the house and I am not ready to marry my real estate agent.’ [They] Maybe give us a chance and that’s all we need to win the business. “
Redfin resumed its RedfinNow home business in June after it was suspended due to the pandemic. It launched RedfinNow in Seattle and San Francisco in December and expanded it to Phoenix last month.
The company’s real estate segment, which includes RedfinNow, posted fourth quarter revenue of $ 39.4 million, compared to $ 99 million a year ago, while gross losses increased from $ 1.3 million to $ 1.8 million .
Redfin laid off 7% of its employees and put hundreds of agents on leave in April. The company announced in July that it had reinstated most of its employees on leave and recruited in several markets.
Redfin last week announced a planned acquisition of RentPath, the Atlanta-based operator of Rent.com, Rentals.com, and ApartmentGuide.com, for $ 608 million. The deal, Redfin’s largest acquisition to date, will add 700 employees to Redfin’s 4,000 employees. RentPath had sales of $ 194 million last year.
However, potential regulatory headwinds await you. In December, RentPath announced an agreement to be acquired by the CoStar Group after a Federal Trade Commission lawsuit to freeze its business, citing potential harm to consumers from consolidation in the home rental market.