2021 Residential Franchise Report
Affiliating your brokerage with a franchise is a decision not to be made lightly. Brokers make the financial outlay with the expectation that they’ll benefit from name recognition, marketing and technology support, and education and networking opportunities. For those considering such a move, every two years REALTOR® Magazine gathers basic data about residential real estate franchises and talks with broker-owners and franchisors about what makes their brand special. Brokers say when they considered affiliating, they looked for not only great systems but also a business model that prioritized their profitability and that of their agents. Stephanie Sandoval has grown her company from 17 agents to 250 since joining HomeSmart in 2017. Sandoval, broker-owner of HomeSmart Lifestyles in Fountain Hills, Ariz., was drawn to the company’s Real Smart Agent and Real Smart Broker platforms, which are “really nice for a seamless transaction,” she says. “The support of having a large franchise and the platforms to make growth easier has been amazing.” When Kansas broker Steven Burch, epro, mrp, took over the reins of his grandmother’s company, he knew he didn’t want to operate it as an independent company. “I wanted help with my personal and professional growth; tools, tech, and training; and recruitment.” His affiliation with NextHome “has surpassed every expectation,” he says. “In 2016, we had 4 agents and sold 67 units with $7.5 million in volume. Last year, we had 25 agents, sold 408 units, and did $69 million in volume.” Overall, since 2019, franchisors have grown their share of residential real estate brokerages slightly. The just-released 2021 National Association of REALTORS® ’ Profile of Real Estate Firms shows 12% of real estate companies are independently owned franchise companies, up from 11% in 2019. Another 2% are subsidiaries of a national or regional corporation that operates a franchise, up from 1% in 2019. NAR’s 2021 Member Profile shows individual member affiliation has remained constant: 42% of REALTORS® are affiliated with a franchise, the same as in 2019. The fastest-growing franchises in this year’s report, seeing double-digit growth in the number of U.S. offices since 2019, were Nest Realty, Flat Rate Realty, and NextHome. United Real Estate, HomeSmart, and NextHome—all relative newcomers—saw big gains in the number of U.S. agents and brokers. Among the big brands, Keller Williams stayed fairly steady in terms of number of offices but added more than 13,000 brokers and agents, nearly a 9% gain from 2019.
TAKE INVENTORY OF YOUR BELONGINGS BEFORE A DISASTER STRIKES
BY HOM EDITORIAL TEAM
As a homeowner, your abode is your pride and joy, and considering how hard you’ve worked to get to this point, how couldn’t it be? After spending countless months—let’s be honest, years—decorating and curating your home, you want to be sure everything is accounted for in case a disaster occurs. Surprisingly, only around half of homeowners have a home inventory, based on a poll from the Insurance Information Institute. This rate has stayed rather stagnant over the past decade, and it’s time for that to change.
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MORTGAGE RATES CONTINUE TO FALL, LEADING TO MORE HOME SALES
“The purchasing power to buy a home has been bolstered by falling mortgage rates, and buyers are responding."
BY ANTHONY SANFILIPPO
Mortgage rates at the end of May dipped below four percent for the first time in 16 months and have now dropped a full percentage point since November, according to data from Freddie Mac.
Pending home sales and new home sales were declining for a while which led to mortgage rates continuing to fall.
However, consumers finally identified a window of opportunity and decided to take it.
According to data released by the National Association of REALTORS® (NAR), existing home sales increased by 2.5 percent in May when compared to April.
Annually, home sales are still down 1.1 percent from this point in 2018, however homebuyers took advantage of the reduced mortgage rates.
“The purchasing power to buy a home has been bolstered by falling mortgage rates, and buyers are responding,” said NAR chief economist Lawrence Yun.
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