Realogy made a profit for the fifth straight quarter. But the brokerage conglomerate faces questions about how its business is diversifying especially amid a slightly cooler housing market.
The company behind Coldwell Banker, Century 21, Better Homes and Gardens, Sotheby’s Realty and Corcoran reported $114 million in third quarter net income Thursday. That compares to a $98 million net gain in the third quarter of 2020 and $149 million net income in Q2.
Realogy has made $296 million in the first nine months of 2021.
The Madison, New Jersey-based business reported $2.19 billion in revenue. But that figure includes the full commission of each home transaction that is completed by a Realogy agent. For the average home sale, roughly 78% of the commission stays with the Realogy agent with the remaining 22% kept with the company. So, once the agent’s commission cut and “other related expenses” are subtracted, Realogy posted $881 million in quarterly revenue.
The vast majority of Realogy’s operations are tied to sales commissions, service fees from title insurance and fees collected from franchise affiliates that use one of the Realogy brand-names. However, the topics de jour on the earnings call were Realogy’s version of instant homebuying – called RealSure, and the company’s mortgage joint venture with Guaranteed Rate.
Company CEO Ryan Schneider repeatedly said in response to analyst questions that he was “excited” and a “big fan” of RealSure, a partnership that Realogy launched in 2019 with HomePartners of America, which today is a subsidiary of Blackstone.
Realogy announced this week that Katie Finnegan, formerly vice president of mergers & acquisitions at Walmart and chief customer & ecommerce officer at RiteAid, would be RealSure’s first CEO, and Schneider said on the call that Realogy was “expanding its investment” in the partnership. …Article continued on HousingWire.com.
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