R
ocket, America's largest mortgage lender, plans to buy Redfin, a national brokerage that has spent 20 years trying to "redefine" residential real estate. The deal is worth nearly $1.75 billion and involves big numbers: Redfin's website attracts almost 50 million views every month, while Rocket handles over 100,000 calls daily.

    The acquisition comes at an interesting time for the industry, with deep fissures about how much control one company should have over real estate listings and who represents buyers and sellers. Higher mortgage rates and elevated home prices are also making it challenging to achieve the American Dream, as Redfin CEO Glenn Kelman noted in a 2024 call.

    USA TODAY spoke with Rocket's Varun Krishna and Redfin's Kelman about their plans for consumers. "The consumer is at the heart of this deal," said Krishna. "We want to make homeownership seamless and frictionless, creating more savings and value for them."

    Kelman added that the central economic problem facing people under 40 is that they can't afford a house due to high fees and complicated processes. He believes their combined company can fix this by providing a better experience and lower fees.

    The industry has long debated how much control one company should have over the real estate process, with some arguing it's too concentrated. Krishna acknowledged the issue of transparency in the current system, where consumers struggle to understand who represents them and what they're paying for.

    "We want to give customers a choice," said Kelman. "They can work with our agent or a different one, but by working together, we can provide a better experience and lower fees." Krishna added that their goal is to create a more transparent system where consumers have better rates and pay lower fees.

    The conversation turned to the challenges of disrupting an industry like real estate, which has many local players and traditional practices. Kelman noted that most companies building technologies in this space don't want to serve customers directly but instead focus on generating leads for others.

    Krishna emphasized the importance of understanding consumer behavior and trends, particularly with rising home prices and mortgage rates. While they're not worried about an uptick in distress, they recognize affordability is a challenge and that inventory and friction are still issues in the industry.

    Their approach aims to create a more sustainable model for homeownership by making it faster and more cost-effective. By helping consumers throughout their lifetime journey from renting to owning a home, they believe they can take costs out of the system and provide a better experience for buyers and sellers alike.