The Wisconsin Senate Committee on Government Operations is considering a bill to ensure homeowners who sell their homes “For Sale by Owner” (FSBO) can advertise on Redfin and other real estate sites. Redfin supports this bill. It gives sellers more choice and ensures buyers are able to discover relevant FSBO homes on the most popular real estate sites. We submitted the following testimony to the legislature today. If you live in Wisconsin, you can connect with your state representatives here to share your support for this policy.
Wisconsin Senate Committee on Government Operations
Senate Bill 394
December 19, 2023
On behalf of Redfin, I appreciate the opportunity to provide written testimony on Senate Bill 394. We appreciate the Committee’s attention to this important issue for Wisconsin consumers.
Redfin is a national brokerage with a mission to redefine real estate in consumers’ favor. Redfin employs local real estate agents to help people buy and sell homes in more than 100 markets nationwide, including Wisconsin. Redfin invented map-based real estate search and operates one of the most visited real estate websites in the country for consumers to find homes for sale and rent.
A cornerstone of our mission is to bring transparency to the real estate marketplace. In today’s housing market, which has been defined by low inventory, high home prices and high mortgage rates, consumers are eager to discover any property that might meet their needs and budget. Redfin data shows that in October, the supply of homes in the Madison and Milwaukee metro areas was down 16% and 5% compared to a year ago, while prices were up 5% and 6% respectively. Redfin economic research found 2023 has been the least affordable year to buy a home on record.
Existing Wisconsin law prevents Redfin and other brokerage sites from displaying homes that are listed for sale by owner (FSBO). Specifically Wisconsin statute 452.136(3) says “a firm…may not advertise a property unless one of the following applies: (a) the firm is the listing firm for the property[;] (b) the firm…has obtained the consent to advertise the property from the listing firm for the property.” As written, the law doesn’t account for homes that are advertised for sale without a listing firm or brokerage, or provide any mechanism for real estate websites –like Redfin’s– to display FSBO listings, even if that’s what the seller wants. This is both anti-consumer and anti-competitive, and harms both homebuyers and sellers.
In practice, the law prevents home sellers from effectively advertising their property to the broadest pool of buyers unless they use a licensed listing agent. This limits the ability of homeowners to sell their properties in the manner they see fit. While Redfin is in the business of helping homeowners sell their properties with Redfin real estate agents, we do not believe every homeowner should be obligated to hire a real estate agent to gain exposure in the market. Consumers should have the ability to choose whether to hire a real estate professional and how to market their home.
Prohibiting real estate brokerage websites from displaying FSBO listings also hurts prospective homebuyers. Homebuyers should be able to see all homes for sale that meet their criteria, regardless of whether those homes are being marketed by real estate professionals, homebuilders, or homeowners directly. Redfin’s agents regularly represent homebuyers in transactions where the home was listed for sale directly by the owner. In this low inventory market, homebuyers may be missing out on FSBO homes in Wisconsin simply because they cannot find them on the most popular real estate websites. These homebuyers are likely unaware that current Wisconsin law prevents them from discovering these relevant listings on sites like Redfin.
SB 394 addresses these problems and brings more transparency and choice to Wisconsin consumers. The bill includes meaningful protections to ensure Wisconsin consumers are adequately informed when a property is being sold without a listing agent. These protections add further clarity for consumers by obligating brokerages to make it clear to consumers who they do or do not represent. The bill also requires real estate sites to receive homeowners’ consent to display FSBO listings, ensuring homeowners are given the power to decide how to advertise their properties.
This is a straightforward proposal that will improve transparency and consumer choice in real estate. We thank the sponsors and their staff for their work on this legislation and strongly encourage the Committee to pass Senate Bill 394.