To all the agents in the house,
Yesterday I reported in this newsletter that Robert Reffkin, the CEO of Compass, made $89.9 million in 2021. This was incorrect, and I apologize. Reffkin earned a little over $18 million in 2021. And he actually took home just $731,406 before taxes.
Where did I go wrong?
The Securities and Exchange Commission's 14-A proxy statement filed in April (page 50 here) does say that Reffkin earned $89.9 million. But it was largely contingent on the stock performing above certain thresholds. The first of those is that Compass's stock would be valued at over $23.14 per share.
However, Compass's stock is trading at about $4 a share today, in turn wiping out what was the majority of Reffkin's slated compensation.
What stays is the $731,406, which includes a $400,000 annual salary plus bonuses. Also, Reffkin holds a little over 4.3 million shares of Compass stock that are indexed to the value of the company's share price. The CEO is free to sell these shares at any time, though a Compass spokesperson said Reffkin has not sold shares.
It bears watching how the company's agents are affected by the stock decline, and what's next in the brokerage's austerity measures.
…Since I, ahem, have your attention, let's talk about what we know so far is changing in the real estate market. I looked at the Phoenix market yesterday, which, for better or worse, is often a national bellwether.
Inventory has climbed 149% in Phoenix in the last four months. But home prices also continue to increase, 17% year-over-year, suggesting that some first time homebuyers have given up on the market. Meanwhile, the number of buyers paying cash, including institutional investors like Preitum Partners, has increased in the Valley of the Sun.
With the real estate market changing as I write, one facet that deserves attention is homebuilding. The U.S. homebuilding economy of the past year was a distinctive mess. Companies including Lennar and Pulte sailed toward profits, but lamented their supply of homes could not meet consumer demand.
With some consumers priced out, what does demand look like? Agents, how much have new homes factored in? What is the pace of homebuilding?
And, what else is changing under your feet in today's market?
Please email me anonymously at mblake@housingwire.com.
Sincerely,
Matthew Blake
Senior Real Estate Reporter
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