The lending giant has struck a deal to acquire the real estate listings site. What does it mean for brokers?
Mortgage giant Rocket Companies inked an all-stock deal worth $1.75 billion to purchase real estate listings site Redfin this week, a bid to grow market share by snagging some of that company’s reported 50 million monthly users.
The lender hopes to create an end-to-end mortgage process that will, according to chief executive officer Varun Krishna, connect “traditionally disparate” steps of the homebuying search under one roof.
The acquisition, which is subject to regulatory approval, is expected to be wrapped up in the coming months. But it’s already got mortgage brokers and loan originators wondering what it could mean for the market and the prospect of greater competition for business looking forward.
We are proud to announce that Rocket Companies has agreed to purchase Redfin.
— Rocket (@RocketOTD) March 10, 2025
This transaction brings together two industry leaders to shape the future of homeownership. For 40 years, Rocket has redefined the housing industry through innovation, leveraging technology and AI… pic.twitter.com/XVYp5QdqwP
It’s certainly a deal to be reckoned with, according to Bruce Gehrke (pictured right), senior director of lending intelligence at data analytics firm J.D. Power, who told Mortgage Professional America the move appeared to be an effort by Rocket to develop a relationship with potential clientele as early as possible in their homebuying journey.
“The way I look to look at it considering more of an advisory relationship as opposed to a traditional transactional relationship, which you see in a lot of lending products and you’ve seen in the mortgage business,” he said, “especially with lower rates going back two, three years ago, when you had huge volumes of refinances. The focus was on a quick, easy and smooth transaction: get it done, get me that lower rate, move on. And now that business has really shrunken.
“It’s still there, but at a much lower level and the focus really is developing this pipeline of homebuyers and enhancing their experience and ability to get into a new home. I think this move by Rocket is directly reflecting that need in the marketplace.”
In pursuit of a housing ‘super app’
If it pays off, the move will complement Rocket’s position as a lender, Gehrke said, bolstering their business on the origination side and potentially ramping up their purchase volume.
It’s also a further step by Rocket in the direction of creating a so-called “super app” for housing, a pursuit already attempted in recent years – with limited success – by Redfin rival Zillow.
“[Rocket] really grew rapidly as a refinance lender and they changed a lot of how refinancing was done, how leads were developed. Their ability to market on a large national scale [was] not something that’s done in the industry,” Gehrke said.
“They’re the only player that really does that and really effectively does that, and now what they’re doing is taking that into the purchase market. I think it’s a really big move and potentially could really change the way business is done and the way other lenders are going to approach it.”
Brokers’ local expertise to continue driving business
But while the extent of that transformation will become clear in the years ahead, it doesn’t seem likely to pose an existential threat to brokers – not least because of their local expertise and market knowledge, both of which remain highly valued among mortgage shoppers and hopeful homebuyers.
The market also reacted uneasily to the news of the deal, with Rocket’s stock price slipping – and Redfin’s soaring – after the announcement, albeit against the backdrop of a generally turbulent economy.
“I think mortgage brokers are always going to have a place in the market because they’re very local,” Gehrke said, “and we still see this as a major consumer preference. That local personal interaction is something that’s always driven the real estate market as well.
“Nothing’s going to change next week or even next year that much. But I think this begins that progress that [brokers], from a longer-term perspective, have to start thinking about.”
Indeed, Gehrke raised the prospect of the deal actually boosting Rocket’s offerings on the wholesale side as a result of Redfin’s valuable ability to mine and gather data to generate leads and source potential business.
“What Rocket is able to do on the retail level [with Redfin], they’ll probably extend on the wholesale level,” he said. “This, I think on the wholesale lending side more quickly, will become a battle of the big players. And I think their ability to mine data is in the long term going to drive how the business change.
“So I think the local guy, they’re going to be OK – but they’re going to keep an eye on how this changes. And I think you’re going to see competition among the wholesale lenders on how to best meet those local needs.”
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