The housing market has been red hot for some time now due to unprecedented demand amid record low mortgage rates. This, along with the remote working culture, has amplified demand for digital real estate brokerage services. As a result, the shares of real-estate technology firm Redfin Corporation (NASDAQ:RDFN) have returned more than 90% over the past year. So, read ahead to learn whether RDFN is a good addition to one’s portfolio now or if it is susceptible to a retreat.Real estate has been one of the best performing industries amid the COVID-19 pandemic thanks to a surge in home buying. The Fed’s easy monetary policy and asset repurchases have pushed interest rates to historic lows, making real estate investments lucrative. Consequently, a shortage of inventory and endless bidding wars have driven property prices to unprecedented highs. The remote work culture has also motivated people to migrate to low-cost towns from expensive cities.
In addition, the pandemic pushed up demand for remote services and, hence, one factor that has worked in favor of real estate companies is the rapid adoption of digitalization. A case in point is tech-first real estate company Redfin Corporation (RDFN). RDFN operates a digital real estate marketplace that offers online residential broking services and allows homebuyers to schedule virtual home tours. The company also delivers ancillary services, such as loan origination and title services, to facilitate a speedy process.
On March 31, RDFN had a 1.14% U.S. market share by value. Driven by its unique business model and given the red-hot housing market, shares of RDFN have returned 92.2% over the past year. In fact, the stock registered a 5.2% intraday gain yesterday to close the session at $57.16.