Realogy plans to “step up” iBuying venture to capitalize on hot housing market

Brokerage giant beat estimates reporting $2.2B in revenue

National /
Oct.October 28, 2021 10:30 AM
Realogy CEO Ryan Schneider (Realogy, Illustration by Kevin Rebong for The Real Deal)

Realogy CEO Ryan Schneider (Realogy, Illustration by Kevin Rebong for The Real Deal)

Realogy expects the housing market’s hot streak to continue and plans on rapidly expanding its iBuying program to capitalize on it.

The brokerage giant reported $2.2 billion in revenue in the third quarter — a 15 percent increase compared to the same period last year — as the housing market heated up amid eased pandemic restrictions. The company’s net income was $114 million, up $16 million from the previous year, according to its Thursday earnings report.

Closed transaction volume increased 12 percent year-over-year, marking the fifth consecutive quarter the company reported a gain.

Last month, Realogy paid down $435 million in debt, continuing its efforts to deleverage and ended the quarter with $700 million in cash. Its total corporate debt was $2.4 billion at the end of September. The company also reported its goal of trimming $80 million in costs this year is nearly complete with $70 million in cost savings realized.

CEO Ryan Schneider pointed to moves by firms catering to the luxury market, including the Corcoran Group doubling its transaction volume and Coldwell Banker’s recent acquisition of Warburg Realty. Schneider also pointed to its iBuyer division, RealSure, as a key part of its growth strategy.

RealSure, the company’s iBuyer program that was founded in 2019 alongside joint venture partner Home Partners of America, this week appointed its first CEO. The move signaled a time of major growth for the platform, on which sellers are guaranteed a 45-day offer with the option to list their home traditionally with an agent and then pick between the two offers.

Katie Finnegan comes to RealSure from a retail and eCommerce background, most recently as an executive at Rite Aid after working with Marc Lore at Jet.com.

The venture between Realogy and Home Partners of America formalized about a year after Realogy launched the program. Blackstone later acquired HPA for $6 billion in June.

The iBuying program now operates in 24 cities, up from 21 last quarter and 13 in the first quarter of the year. Schneider said about 70 percent of RealSure clients request to list their homes with agents.

“RealSure will step up meaningfully in Q4,” the CEO said, noting that Finnegan will be building out the division in coming months and the platform will begin providing services to buyers by fronting cash so they can make competitive offers. Services to buyers will initially roll out in five markets, he said.

Earlier in the month, the company announced the sale of a majority stake in its title insurance business business.

Realogy formed a joint venture with private investment firm Centerbridge Partners, which bought 70 percent of the business for $210 million as the company retained its 30 percent stake. Schneider described the deal as unlocking capital for the brokerage giant and enabling it to focus on its key businesses.





    Related Articles

    arrow_forward_ios
    New York Community Bank CEO Thomas Cangemi
    NYCB slashes 10% of staff as resi mortgages slump
    NYCB slashes 10% of staff as resi mortgages slump
    The Oppenheim Group's Jason Oppenheim (The Oppenheim Group, Getty)
    Commission suits could spell “armageddon”: Jason Oppenheim
    Commission suits could spell “armageddon”: Jason Oppenheim
    From left: Lee & Associates' Max Lapke and Brent Roberts
    Lee & Associates announces Midwest expansion
    Lee & Associates announces Midwest expansion
    @properties Thad Wong
    Watch: “Losing money should not be an option in brokerage”: Thad Wong
    Watch: “Losing money should not be an option in brokerage”: Thad Wong
    M&T Bank's Darren King
    A fifth of M&T’s office loans in danger of default
    A fifth of M&T’s office loans in danger of default
    Tal and Oren Alexander,  Tyrone McKillen (Side, Getty, Pulse Development Group)
    Alexanders tap top Compass agent for LA expansion
    Alexanders tap top Compass agent for LA expansion
    Signature Bank’s Joseph DePaolo and Sam Bankman-Fried (SignatureNY, Getty)
    As Signature severs crypto arm, CRE lending to suffer
    As Signature severs crypto arm, CRE lending to suffer
    Anywhere CEO Ryan Schneider (Realogy, Getty)
    Anywhere announces more layoffs, shutters iBuying
    Anywhere announces more layoffs, shutters iBuying
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...