When the market is in flux, and there’s a focus on regulatory changes on the horizon, it can be difficult to maintain an accurate representation of business performance. It’s something that leading brokerages have had to face, weighing the impact of a difficult market and balancing that with consumer and agent sentiment during an increasingly bumpy road to August mandates.
It’s no wonder the earnings season brought with it a mix of high and flat performers and a heavy dose of NAR settlement talk. Overall, the industry paints a cautiously optimistic picture—one in which a market rebound is just on the other side of the fence and where real estate agents and consumers adapt to the new representation rules and MLS changes without too much stress on existing brokerage models.
Below are the key takeaways from the Q2 earnings season.
Anywhere
Transaction volume increased for the company in Q2, largely due to the company’s luxury business. Anywhere said its Corcoran and Sotheby’s International brands helped drive the market performance.
The company also highlighted the benefits of being the first company to settle the class-action lawsuits nearly a year ago, receiving final court approval in May for the $83.5 million nationwide settlement in the sell-side antitrust class-action cases.
“Anywhere leveraged our distinct advantages to deliver strong results in the quarter, accelerating our transformation and building our future financial octane,” said President and CEO Ryan Schneider. “Our strategic strengths and profitability set Anywhere apart, along with our great affiliated agents, franchisees and employees who continue to deliver great value to consumers.”
Q2 performance highlights
- Revenue: -1% YoY, $1.669 billion
- Net Income: +$30 million
Compass
Compass’ Q2 call brought into the conversation NAR’s “clear cooperation” rule—an anti-homeowner mandate that’s on borrowed time, according to Founder and CEO Robert Reffkin. It’s part of a larger problem in the way the real estate system works today, he said, pointing to days on market as “the killer of value.”
“Clear cooperation, the problem with it is, it’s forcing homeowners into negative insights,” said Reffkin. “It’s saying anyone who has an agent, after one day of public marketing where it was no negative insights on a place like Compass or through your agents, you have to put it in the MLS, and then it goes to the system which the homeowner doesn’t have a choice on.”
Regarding performance, Compass said it continues on the path of success, outpacing general market trends and increasing agent count.
Q2 performance highlights
- Revenue: +14% YoY, $1.7 billion
- Net Income: +$20.7 million
- Agent Count: +24% YoY, 16,997
CoStar
The company’s key focus area, residential portal Homes.com, received over $55 million in net new bookings through June—a milestone that took Apartments.com two years to reach, per the company. Founder and CEO Andy Florance reported on travels to various areas to meet with agents and gauge their thoughts on the portal.
“Over the past month or so, I attended focus groups with agents and consumers in Atlanta, Chicago, Irvine and Nashville,” he said. “Our growth and unaided awareness was clear. Agents reiterated that they prefer our business model of ‘your listing, your lead.’”
Q2 performance highlights
- Revenue: +12%, $678 million
- Net Income: $19 million
eXp
The virtual-focused mega-brokerage expects a turbulent next few months but it says it’s poised to navigate the volatility and provide agents with a “safe haven.” It is particularly focused on transitioning agents from smaller companies that it says could be hit hard by harsh MLS violation penalties.
eXp’s response to the settlement has been to release a standard listing agreement that explicitly does not allow commission sharing with buyer agents. It still, however, allows sellers to directly pay buyer commissions using concessions.
“I’ve been trying to brace the industry because (there is) this kind of collective pulling of their head out of the sand and having this ‘oh no’ moment that we’re kind of witnessing specifically this week,” eXp President Leo Pareja said during the investor’s call. “You guys have all heard me talking about this without pause since the news broke in March…it’s been a very offensive strategy of education.”
On performance, while agent count is up, so is brokerage competition. However, Pareja isn’t worried about copy-cat models that may try to poach agents. In response to tweaking the compensation model to remain competitive, he said the “full-scaled” business remains attractive to agents.
Q2 performance highlights
- Revenue: +5%, $1.3 billion
- Net Income: +$12.4 million
- Real Estate transactions: +1% YoY, 120,613
Offerpad
While CEO Brian Bair expects many changes ahead for agents, he predicts buyers will adapt to dealing with sellers directly, potentially moving toward unassisted transactions. Regarding the business, a low stock market performance in August brought into question stability. However, Bair assured investors that the company would make it through even during an economic downturn.
“(T)here’s talks this morning on recessions and those things, and people still buy and sell homes and transact real estate and recessions. And so, we’re watching all of that closely and expecting similar to what we’re seeing now, 4 million units moving through a year,” he said.
Q2 performance highlights
- Revenue: $251.1 million
- Net Income: $21.9 million
- Homes Acquired: 831
Opendoor
Change is coming on the commission front as a result of the settlement, the company said. Opendoor CEO Carrie Wheeler said the company has seen about 10 to 15 basis points of pressure on the commission rate since April. It’s not a huge amount, she said, but significantly different than prior years.
“It’s going to take down the cost of the transaction. It’s going to lower friction, and we can pass it on to consumers and drive more transactions,” she said. “And we think as people become more educated, the potential to lean into the fact that we have the only direct e-commerce platform to buy a home is really important, and people, as we come educated as a cost of additional agents to help, should lean into our direct platform because we can share more savings with them.”
Though many figures were down YoY for the company, Opendoor remains confident in its quarterly growth, adapting to housing market signals to make decisions that balance growth, margin and risk in a challenged environment.
Q2 performance highlights
- Revenue: -24%, $1.5 billion
- Net Income: $129 million
RE/MAX
The brokerage is feeling the pressure on its agent count, blaming in part the macro environment but also the new buyer representation laws going into effect with the Aug. 17 mandate. The company, however, believes it is largely protected from any settlement-related fallout, stating RE/MAX agents are “a bit more protected” due to having “more productive agents.”
“So, do I think that agent count will continue to be under pressure from an industry perspective? Absolutely,” said CEO Erik Carlson. “Do I think it’ll hit part-time harder than full-time? A hundred percent. Are we subject to continued agent count decline? Yes, but I think we are starting to bend the trend a little bit and understand who’s leaving, why they’re leaving and what we can do to course-correct there.”
Q2 performance highlights
- Revenue: -4.8% YoY, $78.5 million
- Net Income: +$3.7 million
- Agent count: -0.7% YoY, 143,542
Redfin
CEO Glenn Kelman had his eyes on the for-sale market, calling it terrible in the days leading up to the earnings announcement.
“Agents we polled about the low number of offers cited broadening economic anxieties, the distraction of a presidential election and homebuyers’ growing belief that time is on their side,” he said. “In a shifting market, sellers often get stuck on the asking price from last month, while buyers imagine they can get an even better deal next month. If rates keep falling, U.S. home sales should increase. We expect rates will stay low through the winter and into next spring, which should lead to a much stronger housing market in 2025.”
While the market proved difficult with sluggish pending sales, he pointed to areas of the business that have been successful, including the growth of Redfin Next, which shifts the payout model for agents from salary to commission. The program hit California markets during its initial launch and has expanded quickly.
Q2 performance highlights
- Revenue: +7%, 295 million
- Net Income: -$27.9 million
Rocket Companies
There’s a market rebound on the horizon, per Rocket Companies. While the when and how remains murky, the company is excited about opportunities for creating tech-powered efficiencies using artificial intelligence.
“From a resource perspective, AI is our most strategic imperative, and we are resourcing this to win. We see concrete tangible benefits,” said CEO Varun Krishna. “We see hours saved, we see faster call resolution, we see faster turn times. We see 100% accuracy on verification. And these are the earliest stages.”
Q2 performance highlights
- Revenue: $1.2 billion
- Net Income: +$121 million
- Closed Loan Origination Volume: $24.7 billion
Zillow
The company’s confident earnings report is a credit to Zillow’s product experiences, said CFO Jeremy Hofmann. Ahead of earnings, Zillow announced that CEO and Co-Founder Rich Barton was moving to an executive chairman role, with COO Jeremy Wacksman stepping up to lead. The portal’s stock spiked over 18% in early trading after the report, which included a 13% increase in revenue to $572 million.
While many in the industry have voiced their concerns over the settlement mandates, Zillow has jumped at the opportunity to adapt to the changes with its own touring agreement that is meant to satisfy the new buyer-agent contract requirement. So far, the agreement has been used in almost 80% of connections, per Wacksman, who calls it a major success.
“Our expectation is the touring agreement will be a net benefit to conversion because it’s in the flow post-introduction. It’s just education, and it’s a helpful qualification,” he said. “Education to the consumer, done in a consumer-friendly way, helps get that consumer more informed before they get to the tour, and makes it more likely that they’ll want to work with the agent.”
Q2 performance highlights
- Revenue: +13%, $572 million
- Net Income: +$442 million
- Purchase Loan Origination Volume: +125% YoY, $756 million
