RedFin advertises that it lists houses for 1% but once you read the language marked by an * you will see that it's actualy 1.5% and you may be rebated for 0.5% at the next closing you have using one of their agents within a certain time.  Also, before the 1% applies, there's actual minimums of $3000, no matter the sales price, for Seller’s fee PLUS minimum of $6500 (or 1% whichever is bigger) for buyer’s agent.  

Many sales are in the range of $250,000.  1% listing fee for that would be $2,500 (not $3,000) and 2% for buyer would be only $5,000 (not $6500).  Therefore, a client listing in this range, is actually paying more to RedFin than the 1% advertised.

PLUS, it is NOT 1% listing fee.  Once you read the fine print, you see that it is a minimum of 1.5%.  RedFin says, in the fine print, that it charges this at the sale, and then may refund up to 0.5% if this person buys another property using RedFin agents and refund that at the buy, provided that the lender or someone else does not object.  As you know, lender’s most often object so it is likely that the seller would never see this 0.5% return once he’s buying.  In addition, this will limit the buyer’s ability to get credits for repairs from the Seller (because the lender will only permit a credit towards closing costs, from anyone. 

ANOTHER UPCHARGE: If the property sells to a Buyer who is unrepresented RedFin adds on a fee of 1% of sales price to their whole commission.  For a property of $250,000 that is an additional $2500 cost to Seller.  Most brokers, however, will give you a discount rather than an upcharge in that situation. 

For sales prices up to $200,000 your cost at a normal rate of 5% is actually cheaper or the same than what the RedFin offer is.

At a price of $325,000 you start to get into interesting math when you contemplate that the buyer’s agent may demand more money they are entitled to, to make the deal.