Brokerage Growth Dominated by New Models

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The fastest growing real estate brokerages of the past seven years – representing over $383 billion in sales volume growth – are new companies with new models.

Why it matters: While the job of an agent hasn’t changed much, the business models of the fastest growing brokerages have undergone a transformation.

  • The biggest gainers – Compass, eXp, Real, and Side – are all new models that barely registered back in 2018, but account for over $383 billion in new sales volume growth.
     

  • The biggest incumbents of 2018, Anywhere and HomeServices of America, only grew their sales volume by $10 billion during the same time period.

 
 

The growth of the new models has been stunning compared to the large, traditional incumbents.

  • In 2018, Anywhere was nearly 9 times as big as eXp – now that lead has shrunk to only 1.2 times larger.
     

  • In 2018, HomeServices of America was three times the size of Compass – now Compass is 1.7 times larger.

 
 

As a percentage, sales volume at three brokerages grew less than the increase in average sales price of a home during the same period of time: Anywhere, HomeServices of America, and Redfin.

  • This is a reflection of declining market share at these businesses since 2018.
     

  • And Redfin has faced its own series of challenges (for a deeper dive, check out my recent podcast episode on that topic).

 
 

Which brings us to today (or at least the end of 2024), with the top 11 brokerages a wild mix of traditional incumbents and new models.

  • The list includes luxury brands, 100% commission models, 100-year-old brands, portal hybrids, cloud brokers, and more.
     

  • The source of this data (and a lot more) is RealTrends.

 
 

The bottom line: It’s difficult to tell if the industry is changing quickly or slowly, but zoom out and it’s clear that a range of new models are growing extremely fast, while the traditional incumbents remain large, but are lagging.

  • It’s not one size fits all and there is no “winning model.” Yet.
     

  • But every brokerage in this list, regardless of business model, shares one important factor: at the center of every deal, every sale, and every transaction is an agent.

Thanks to Mark McLaughlin for the discussion that led to this analysis!