Real EstateBrokerage

Redfin losses soar amid iBuying ramp up

The acquisition of RentPath also contributed to a $110 million yearly loss in 2021

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You can’t please all the people all of the time, but Redfin is a unique real estate brokerage, an instant homebuyer, a popular listings website, a platform for renters, a mortgage company, a title company, a concierge service, and a research service on the U.S. housing market.

What does that all add up to? A company that posted a $110 million dollar loss in 2021, a sextuple leap from the $19 million lost in 2020. Redfin is projecting similar, if not higher losses, in upcoming quarters as it incorporates multiple moving parts.

The loss was accompanied by rapid growth. Redfin posted $1.9 billion in 2021 revenue, a 108% jump from 2020.

As with rival Zillow, Redfin grew its 2021 revenue and losses due to iBuying. The company’s properties division, home to iBuying arm RedfinNow, saw revenue rocket to $881 million in 2021 compared to $210 million in 2020, a year when the company partly paused iBuying due to COVID-19.

Redfin CEO Glenn Kelman claimed on an earnings call Thursday that his company is running a profitable iBuying business. The $881 million in revenue did exceed a $871 million “cost of revenue.” But this “gross profit” imagines a world where none of the company’s $367 million in operating expenses went to iBuying.

In fact, operating expenses were split among Redfin Now, Redfin’s 16-year-old brokerage division, and its mortgage arm. >>>>Continued on HousingWire.com

This article was originally published by HousingWire. The full article is available on HousingWire.com for HW+ Members.