Is this Compass pointing in the right direction?

What is going on at Compass and how does it change your notions of how a brokerage can presently succeed?

Good afternoon! Was this newsletter forwarded to you? Sign up here.  To all the agents in the house,   What is going on at Compass and how does it change your notions of how a brokerage can presently succeed?   The New York City real estate brokerage lost $7 million in the second quarter, according to its earnings report released Monday, which is a heck of a lot less than the $212 million it lost the quarter before and the $270 million it bled in total last year.    Also, Compass's revenue is finally drawing a faint resemblance to its flashy market share and sales volume numbers. Its $361 million in revenue after subtracting agent commissions and other related expenses compares favorably to prior quarters, including $151 million in the first quarter.    During its rapid rise throughout urban America the last eight years, many agents and industry observers have dimly viewed Compass's commission split -- with the agent receiving more than 80% of the commission from each transaction -- plus other perks as foreclosing any possibility of turning a profit.    And, yeah, Compass is still losing money when its chief rival, Realogy, made a profit the last two quarters. Plus, Compass spent millions of dollars acquiring the technology of companies like Glide and Contactually, and millions more on hiring in-house engineers with an unclear end (CEO Robert Reffkin said on the earnings call that the plan now is an "end-to-end platform" for agents that will be available "next summer").    On the other hand...Compass is improving its financials, while still yet to wade into the relatively more profitable world of mortgage. The company hopes to launch a mortgage joint venture with Guaranteed Rate later this year.    Once upon a time, back in the 1970s, agents and brokerage split commissions 50-50. RE/MAX upended that, and showed you could still run a profitable brokerage. Commission splits have been trending in the agent's favor since.   Agents, do you believe Compass is the next step in this trend? Are they developing a profitable strategy? And how might it change the splits, bonuses, and other practices at your own brokerage?   Please email me anonymously at mblake@housingwire.com.   Sincerely, Matthew Blake Boise home prices rising faster than any other US city   No city in America saw larger home price gains in the first half of 2021 than Boise, Idaho. Home prices rose 13% from December ($410,000) to June ($463,383). Download Now: Get the list! The perfect follow-up process does exist! Want to know what top agents do every day to succeed? They shared their perfected processes, and we compiled into a super easy to-do list. Learn More! Sponsored by BoomTown Rocket announces discount real estate brokerage   Rocket Companies this week declared its intention to "combine every aspect of home selling and buying into one simple, customizable platform." The homebuyer journey is changing – So should you   While the role and future of the real estate transaction process for a homebuyer are lively debated, we need to have more dialogue on how brokerages can capture the most important stakeholder of all: The homebuyer. Let's dive into two areas that technology partners and independent brokerages can align to ensure that demand is captured and more at-bats are won. Presented by Propertybase Side's Hilary Saunders: An inside look at the alternative brokerage model   As one of only a handful of female co-founders in the industry, 2021 Women of Influence Hilary Saunders, who serves as co-founder and chief broker officer at Side, shares her journey in growing the alternative brokerage model. HW+ Premium Content Op-Ed: A scathing rebuke of Rex's "real estate cartel" claim   REX claims they don't need the Realtor marketplace's efficiencies and then whines when their business is struggling, because — wait for it — housing consumers actually like the benefits of using the Realtor marketplace. HousingWire, 433 East Las Colinas Blvd., Suite 830, Irving, TX 75039, (469) 893-1480 Manage preferences

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