Rocket Companies has announced that it has completed its acquisition of Redfin in an all-stock transaction for $1.75 billion.
Founded in 2004, Redfin operates a home search platform with more than one million for-sale and rental listings and a tech-powered brokerage of more than 2,200 agents. Rocket’s digital platform has grown to provide home financing in all 50 states across more than 3,000 counties and parishes.
“I’ve used Redfin every day for the last 20 years. It helped me find and fall in love with my first home, completely changing how I thought about real estate,” said Varun Krishna, Rocket Companies CEO. “The Redfin team is best-in-class in building a product experience focused on simplicity. It was a perfect fit for Rocket’s vision of what the homeownership experience should be.”
Due to the acquisition, Redfin’s shares were delisted from Nasdaq, and its reporting obligations under the Securities Exchange Act were suspended. News of the closing of the deal drove Rocket Companies shares upward 2.12% to $14.48 per share.
“The gulf between the American Dream of homeownership and reality has never been wider,” said Redfin CEO Glenn Kelman. “The reason Rocket and Redfin came together was to bridge that gap, so that the people who spend their days dreaming on Redfin.com can easily use Rocket financing to own their dream.”
The merger is expected to:
- Introduce more consumers to the Rocket ecosystem: Rocket Companies will benefit from Redfin’s nearly 50 million monthly visitors, one million active purchase and rental listings and staff of 2,200-plus real estate agents across 42 states–with Redfin agents ranking in the top 1% of agents working at any nationwide brokerage.
- Drive purchase mortgage growth: The transaction will generate significant revenue synergies across search, real estate brokerage, mortgage origination, title, and servicing. Rocket will match homebuyers with the best real estate agents and the best loan officers across the combined companies. In 2024, Rocket saw an 8% year-over-year increase in purchase market share and aims to further accelerate growth through this acquisition.
- AI, technology, and personalization at scale: With more than 14 petabytes of combined data, Rocket gains unparalleled consumer insights, including information about homebuyers, sellers, and agents across a data repository of 100 million properties. This data will strengthen Rocket’s AI models enabling easier and more personalized and automated consumer experiences.
- Achieve significant earnings accretion: Rocket expects the combined company to achieve more than $200 million in run-rate synergies by 2027, including approximately $140 million in cost synergies from rationalization of duplicative operations and other costs. In addition, Rocket expects more than $60 million in revenue synergies from pairing the company’s financing clients with Redfin real estate agents, and from driving clients working with Redfin agents to Rocket’s mortgage, title, and servicing offerings. The transaction is expected to be accretive to Rocket Companies’ adjusted earnings per share by the end of 2026. Rocket Companies will maintain its strong balance sheet and conservative leverage profile upon close of the transaction.
The companies have also introduced Rocket Preferred Pricing. Clients who finance their home through Rocket Mortgage and buy a home listed by a Redfin agent or purchase with the help of a Redfin agent will have a one percentage point reduction in their interest rate for the first year of their loan, or receive a lender credit at closing, up to $6,0001.
Rocket Preferred Pricing is available to qualified clients buying a home with conventional, FHA or VA loans. Rocket Mortgage and Redfin plan to launch additional products and services for homebuyers, real estate agents, and mortgage brokers in the coming months.
Under terms of the deal, the rebranded “Redfin Powered by Rocket” indicates what lies ahead—smarter tools, streamlined processes, and more ways to make homeownership accessible.
Bruce Gehrke, Senior Director of Lending Intelligence at J.D. Power, added: “This is a big development for the mortgage space. Lead conversion opportunities are occurring earlier in the sales funnel than ever before. In recent J.D. Power data, 43% of new borrowers engaged with their lender before they started looking for a new home. Contacting potential borrowers early not only leads to improved customer satisfaction but also drives better advocacy and loyalty metrics. For instance, we’ve found borrowers who were engaged earlier are 41% less likely to consult another lender and are 73% less likely to apply with a second lender. Those should be eye-popping figures for mortgage companies. What’s more, according to the latest J.D. Power data, new borrowers using the Redfin website are evenly distributed among various lenders, with no single lender representing more than 10% of Redfin’s total volume. That presents a huge opportunity for Rocket.”
