Goldman Sachs analyst Michael Ng, CFA, downgraded Redfin Corp. (NASDAQ:RDFN) from Neutral to Sell on Monday, citing growing competition, agent commission pressures and affordability challenges in the U.S. housing market.

According to the expert, Redfin currently screens rich valuations despite a still weak U.S. housing market.

Redfin shares have gained 22% in the past 12 months, lagging the S&P 500’s 29% rise. The stock now trades at 88x its 2025 enterprise value-to-EBITDA (EV/EBITDA), far above Compass Inc. (NASDAQ:COMP) at 14x and Zillow Group (NASDAQ:ZG) at 25x.

Housing Affordability At the Worst Level On Record

“Housing affordability is the worst-on-record,” according to the National Association of Realtors (NAR).

Goldman Sachs metrics based on the ratio of monthly mortgage payments to U.S. median household income, incorporating the median home sales price and 30-year fixed mortgage rates, show affordability is at its worst level since at least 2004.

As of November 2024, the average 30-year fixed mortgage rate stood at 6.79%, a slight decline from 7.5% a year ago. Despite this drop, affordability remains deeply constrained due to persistently high home prices …

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