They’re really talking to their accountant in comparing what they could earn on the outside world and what they could earn at Redfin and then they’re making the decision to come over. The length of the Redfin test could be as short as weeks for rolling out to a few additional markets to roll out nationwide. That would be more like a year. We’re trying to work backwards from what are all the things we have to understand to be able to roll this out to every market. You should just remember that for us to get a significant financial impact we don’t have to reach that many markets because the big high-price markets are where we have the most agents and the most gross commissions. So we think that this could have meaningful financial impact by the summer and we think we’d be in a good position to make decisions about whether to roll it out everywhere by then.
Our assumption has been that this is part of our future. Whether it’s part of every market’s future or just part of the big market’s future, TBD.
Bernie McTernan: Understood. Thanks, I appreciate it. And then just a follow-up on the the continued guidance for expecting it to EBITDA positive by the end of the first half of next year. Just you could just discuss kind of any other you know levers you can pull in the business while you’re waiting for the housing market to get back either from a cost side or plants of higher returns on investment that could help you reach that goal.
Chris Nielsen: Sure. So a few comments there. I think one critical part is continuing to develop the digital businesses that we’ve talked about on this call. Continuing to expand the revenues we earn from advertising and other offerings on redfin.com. Continue to grow our rentals business will be an important part of that. And then we do expect that we’ll continue to have the opportunity to gain market share through the first part of next year into the year that’ll be important in terms of building a stronger revenue base. And I do think in the last part we are as Glenn mentioned on the call paying an awful lot of attention to costs. We’re deferring costs at this point until we can see more clearly what the housing market looks like. And we do have a variety of levers we could pull on the cost side of things. So we’ll pay attention to that and only decide to move forward with those costs when we can see you know our way clear to the day life.
Bernie McTernan: Got it. Thanks Chris.
Operator: Our next question comes from Ygal Arounian with City Group. Please proceed with your question.
Ygal Arounian: Hey good afternoon guys. I want to maybe talk a little bit more about the NAR lawsuits that’s been the majority of conversations this week and last week. So I understood how the digital aspects of the brokerage you guys built and give you an edge in that kind of environment where buyers have more tools for themselves. But could we expand on this a little bit? A, I thought the comments were interesting on potentially, I think you implied licensing from this other seller agents going to bring more sellers or more listings to Redfin do you think? And then, the offset here is that you make a good amount of money from buyer agencies right? So if buyer agencies, I’m sure you don’t expect them to go away completely but if they are reduced kind of in a dramatic way, does that have a net negative impact?
And then on the same topic you guys were in the second round, the copycat one were listed as a defendant in that one too and just want to maybe get the comments on how you think about that and what the kind of potential or liability could be out of that as much as you can comment on it to understand it’s a legal matter. Thanks.
Glenn Kelman: Sure. Well why don’t we talk about the Copycat lawsuit first mostly to say that we’re not going to talk about it as we emphasized in our earnings remarks this company exists to give consumers a better deal for 18 years we have busted our tail to work with the industry to find different ways to save people money. Every possible configuration of a business that could put the customer first, we’ve tried it and we are absolutely proud of everything that we’ve done which means we have very good defences for this lawsuit. So I think your other questions were about just how we could leverage our platform in different ways. So obviously it’s going to be important for us to be able to use that platform to sell our own listings, but we do have a vast network of other agents who work with Redfin as our partners and it may be that they would also want to use that platform to sell their listings directly to consumers.
And so today, if there is someone who’s trying to buy a Redfin listing or the listing of a Redfin partner, we route them to a buyer’s agent but we may instead say we can route them directly to the listing agent and there are various ways that we can monetize that. So the key assets that we have are first of all this website and then all these tools that we’ve built over many years to make it easy for a buyer to set up his own tours to make it easy for a buyer to prepare his own offers, to look at his own comparable sales and come up with his own price. And so we just think we’re better positioned than anyone else. We take it as a given that several trends are going to continue. The first is that all year and probably last year too commissions have been significantly compressing that will continue.
Dual agency has increased in part because inventory has just been low because of all the attention this case is getting many people are going to become aware of the fact that hiring a buyer’s agent is a choice and for many people that may be a good choice but other people may choose not to do that. And then the third thing that’s really changed in the industry especially over the past few months has been the proliferation of buyer’s agency agreements. The old saying was that buyers slide rather than decide, but now, agents are putting that question explicitly to the consumer. Do you want to hire me? Do you want my representation? Am I worth the money? And that is very healthy for the industry. It’s part of this sales initiative that we touched on only briefly and the scripted part of the call where we’re now asking buyers to sign up with Redfins and offering them a commission refund when they do.
So just in general, these are all trends that were already happening in the world. It’s very unpredictable what will happen next. We think we’re the most agile player with the largest digital asset among any brokers. And so, the more the industry changes, the better position we’ll be. And if we have to make money by being listing agents instead of buyer’s agents if we have to make money from being digital rather than focusing on service. I think we’ve demonstrated over the past year. Dang, we can move fast to do that.
