The Real Brokerage (REAX) Stephens 26th Annual Investment Conference | NASH2024 summary

Macroeconomic and industry outlook

• U.S. housing transactions expected to rise slightly in the coming year, with 30-year mortgage rates projected to fall to the high 5% to low 6% range by year-end.

• Home prices anticipated to remain flat or see modest gains, with affordability as a key challenge.

• Market normalization to historical transaction averages is expected by 2027.

• No significant downward pressure on agent commissions anticipated in the next 12 months following NAR settlement changes.

• Recent market data shows less seasonality and stronger winter activity compared to previous years.

Regulatory and policy changes

• NAR settlement introduced two main changes: seller agents can no longer offer buyer agent compensation on MLS, and buyers must sign agreements outlining agent compensation.

• Company proactively educated agents and digitized compliance processes, resulting in smooth adaptation and no business disruption.

• Clear Cooperation Policy (CCP) requires listings to be on MLS within 24 hours; company remains neutral but sees current policy as consumer-friendly.

Business model and growth strategy

• Operates a cloud-based, low-overhead brokerage model with no monthly fees, an 85/15 commission split, and a $12,000 cap.

• Agents benefit from equity incentives, revenue sharing, and participation in ancillary services like title and mortgage.

• Addressable market is 1.5 million agents, with industry fragmentation presenting significant growth opportunity.

• 80%+ year-over-year agent growth, with 85% of new agents joining via referrals; revenue share program is a key recruitment tool.

• Attrition rate measured by revenue churn is below 2% per quarter, outperforming industry norms.