Realogy boss on cost-cutting, the competitive landscape and what to look for in 2020
“In an industry where 3 of the top 6-owned brokerages lose money, we like to make a substantial amount,” says CEO Ryan Schneider
Ryan Schneider likes to keep Realogy’s eyes on the prize: better agents, better products and better technology that will keep the firm profitable in the long run. The rest — lawsuits, short-term stock price fluctuations, rivals flaunting big signing bonuses — is all noise.
“In an industry where three of the top six-owned brokerages lose money, we like to make a substantial amount of money,” Schneider told Inman in an interview. “We like the fact that the market is looking for that flight to quality and we’re seeing that show up in the competitive environment, also.”
Schneider discussed Realogy’s approach to cost-cutting. The firm, parent company to brands such as Coldwell Banker, Sotheby’s International Realty and the Corcoran Group, has shut several offices this year, combined teams, and even sold off businesses to get costs under control. But all that, he said, has to come hand-in-hand with investment in the firm’s main business.
“I tell my team all the time, ‘you can’t cut your way to greatness,’ he said. “You’ve got to actually drive growth.” During the third quarter, Realogy generated $1.6 billion in revenue, down 2.8 percent year-over-year. The company said it lost $69 million during the quarter, compared with last year’s net income of $104 million, which it attributed to an impairment — or write-down in value — of its NRT business.
Without naming the likes of Compass, which Realogy is engaged in a major lawsuit over the SoftBank-backed brokerage’s competitive practices, Schneider said that six- and seven-figure signing bonuses were “not economic or sustainable.” Compass has said that it was approached by Schneider regarding it potentially buying Realogy, which Realogy has denied.
Schneider also discussed the big trends that Realogy was tracking in 2020, including the instant-homebuying craze known as iBuying that has been taken on by everyone from Zillow to Opendoor to Keller Williams, as well as Realogy. Its approach to iBuying, known as RealSure, gives sellers the “certainty of an offer that they can get for 45 days and we try to sell their house for the best price possible,” he said. [Inman] — TRD Staff