T3 Insight

Innovations in agent compensation, back-office tech + brokerage KPIs

Articles in this Edition

In this edition of T3 Insight, T3 Sixty's latest monthly analysis of the residential real estate brokerage industry includes articles on Innovations in agent compensation, back-office tech + brokerage KPIs. Take a deep dive below.

Released July 22, 2021

The 6 critical KPIs brokerages must track

by: Dean Cottrill

How to choose the best brokerage back-office accounting technology platform

by: Jonathan Peterson

The proliferation of the ‘commission plus’ agent compensation model

by: Paul Hagey

What We're Reading

In addition to the articles, here are a few items we are reading from across the internet.

Fannie Mae downgrades housing forecast

Fannie Mae downgrades housing forecast After a torrid start to the year, the housing market may not see as big a 2021 boom as originally projected by some experts. Citing a continued dearth of inventory, constrained by homebuilding challenges, Fannie Mae has downgraded its 2021 home sales forecast from a 6.3 percent increase over 2020 to a 4.2 percent increase to 5.49 million single-family home sales. The economy, and real estate, continues to fly high, but inflation, higher prices, and homebuilding challenges, are beginning to emerge as the limiting reagents of the housing market. As these factors evolve, the outlook will undoubtedly shift further as the year progresses.

Fannie Mae

Oregon passes law requiring agents to reject buyer ‘love letters’

This month, Oregon passed a new law, which goes into effect throughout the state in January 2022, that requires real estate agents to reject the personal letters and sometimes photos that buyers, via their agent, submit along with their offers. This practice is fairly widespread in the industry and has become increasingly controversial in recent years as recognition grows that the act could contribute to discrimination based on race, family status or other details that comes through in these “love letters.” Oregon is the first state to pass the law, and others are expected to follow suit.

Inman

Watchdog group sues 36 New York agents and landlords for housing discrimination

Watchdog group sues 36 New York agents and landlords for housing discrimination The New York watchdog group Housing Rights Initiative, after an eight-month investigation using testers, has sued 36 agents, brokers and landlords in New York state court alleging their activities led to housing discrimination. The investigation centered on alleged discrimination against Section 8 recipients. Race is not the only inequity real estate brokers, agents and leaders need to focus on. This investigation and lawsuit highlights another important element of diversity that the industry needs to focus on as well: discrimination against lower-income clients. This broad-based need to improve industry diversity is one of driving forces behind The Real Estate Apprentice Foundation, a nationwide nonprofit founded by T3 Sixty CEO Stefan Swanepoel, that aims to help people from underrepresented and underprivileged groups jumpstart real estate careers.

CoreLogic set to acquire closing tech firm ClosingCorp

Now that its sale to private equity groups Stone Point Capital and Insight Partners is complete, CoreLogic is making moves, with the planned acquisition of closing services firm ClosingCorp. Many of the nation’s 25 largest lenders use the tool to help derive closing cost pricing. The deal is expected to close in the third quarter.

HousingWire

IFunder Flyhomes raises $150 million

The market for iFunders – which provide financing solutions to homebuyers that go beyond the traditional mortgage – is hot! Flyhomes, which helps homebuyers make all-cash offers with short-term loans, launched in 2016 and has already raised $160 million in debt and equity financing. It now adds $150 million to the pot with this raise. Another iFunder, Homeward, which offers a similar service to homebuyers, raised $371 million in May.

GeekWire

US DOJ pulls out of proposed settlement with NAR over its antitrust lawsuit

On July 1, the U.S. Department of Justice pulled out of a proposed settlement with NAR related to its antitrust lawsuit against the trade organization announced last November. Under that proposed settlement, NAR agreed to make buyer agent compensation fees publicly available via MLSs, prohibit buyer’s agents from advertising their services as “free,” and make all properties listed on the MLS available to all licensed agents. NAR was still implementing those changes when the DOJ pulled out citing an interest in keep its ability to pursue future antitrust claims against NAR unfettered. This development, along with new U.S. Federal Trade Commission Chair Lina Khan, regarded as tough on antitrust issues, suggests that the DOJ is evaluating expanding or changing its existing lawsuit against NAR, or filing a new one. This, along with the existing handful of class-action antitrust lawsuits against NAR from homesellers and homebuyers, adds some weight to concerns about further legal actions that could significantly change how U.S. real estate has been practiced for decades.

US Department of Justice

Alternative financer Accept.inc secures $90M round

Alternative financing models, or iFunding, in which lenders provide innovative ways to streamline the homebuying process, have become extremely popular with investors, and startups. Accept.inc, which helps buyers submit all-cash offers after qualifying for a mortgage, is the latest iFunder to raise a large round. Just this May, another iFunder, Homeward, raised $371 million. Investors and startups are hoping these iFunding models will get traction and lead to simplified, speedier transactions, and betting big.

TechCrunch

Blackstone betting big on single-family rentals with $6B acquisition

Global investment firm Blackstone Group has acquired Home Partners of America, which owns over 17,000 U.S. single-family homes that it rents out, for $6 billion. As home prices rise, more families are priced out or delayed in the ability to purchase a home, which will likely increase the demand for single-family rentals – that’s the bet Blackstone is making. Blackstone has deep experience with single-family rentals; it was a major owner of single-family rentals in the wake of the subprime mortgage crisis with its Invitation Homes business, which owned over 80,000 single-family home rentals. It divested in that business in 2019, but now it’s back.

The Wall Street Journal

Compass and eXp World Holdings announce mortgage joint ventures

Mortgages have been an important source of ancillary revenue for residential real estate brokerages for decades and younger companies are beginning to jump all in. Compass, founded in 2012, has partnered with Guaranteed Rate to form a new joint-venture mortgage company OriginPoint, while eXp, founded in 2009, formed a joint venture with Kind Lending to establish Success Lending. Compass leverages a mortgage partner already with a presence in the industry, which allows it to jump in quickly to the mortgage space and ramp up production quickly. Realogy formed its own joint venture with Guaranteed Rate, Guaranteed Rate Affinity, in 2017, and it has contributed importantly to Realogy’s bottom line in recent quarters. Kind Lending, on the other hand, is itself a startup, having launched in just 2019.

Yahoo Finance

Ohio’s largest MLS eliminates ‘Coming Soon’ status

MLS Now, which serves 13,800 subscribers in Ohio and West Virginia, is eliminating the “Coming Soon” status for listings as it found a significant portion of agents using the status primarily to market, and sell, listings before they went officially active in the MLS. This practice of marketing homes to encourage exclusivity, which the Clear Cooperation Policy aimed to curb, is still rife in many markets. Exclusivity persists, however, with agents using the office exclusive provision of the policy, and by agents making listings live in the MLS on Friday, but waiting until Monday to mark as active, which complies with the policy’s rules. MLSs will have to continue to monitor this premarketing activity and tweak their rules accordingly.

Inman