During the company’s Friday morning earnings call, the company revealed more detailed information about the company’s strategies for 2021.
RE / MAX announced Thursday during its earnings release that the company’s deep investments in its own business – through a combination of acquisitions and strategic recruiting initiatives – are keeping the company’s sales figures closely in line with 2019, even if the property market is blazing and many competitors are prompted new heights.
During the company’s earnings call on Friday morning prior to the opening of the U.S. stock market, the company revealed more detailed information about these investments and their payouts, as well as other corporate strategies for 2021.
Here are three of the most interesting details company executives revealed on the call.
Motto mortgage sets new standards
The company’s Motto Mortgage brand had a record year, closing nearly $ 2.5 billion in lending and helping more than 10,000 families. The total volume almost doubled compared to 2019.
At year-end, there were 141 themed mortgage franchises nationwide in nearly 40 states, up 27 percent from the same period last year. The company sold more than 70 themed mortgage franchises in 2020, up 35 percent from 2019.
“Closing out nearly $ 2.5 billion in credit as a network each year is a remarkable achievement, especially in a challenging year like 2020 – only our fourth full year of operation,” said Ward Morrison, president of Motto Mortgage, in one Explanation. “That was just one of many achievements for our brand over the past year.
“2020 was a record year for themed franchise sales, and the fourth quarter was our best quarter ever in the company’s history,” added Morrison. “Our dynamic is real.”
One focus of the Motto business in 2021 will be the successful integration of wemlo, a startup that offers third-party mortgage loan processing and that RE / MAX acquired in 2020.
RE / MAX to increase franchise fees
Beginning April 1 – and July 1 in New York – RE / MAX will increase its monthly franchise fee in company-owned regions in the US by $ 5, said Nick Bailey, chief customer officer of RE / MAX, on the competition of the company with investors.
This is a move that follows years of strategic acquisitions and investments in the company’s business, including deferring some new agent fees as a recruiting tool in 2020.
“To ensure we were delivering the tools, resources, and competitive advantage that RE / MAX agents could use to continue to outperform their competitors, we looked at our fee structure and decided to make a small adjustment,” said Bailey.
The average franchise fee for RE / MAX agents in company-owned regions in the US averages $ 128 per month, RE / MAX chief financial officer Karri Callahan said at the request. The company expects the increase to generate revenue of around $ 2 million in 2021.
“This investment will help continuously expand the systems and services that enable RE / MAX subsidiaries to differentiate themselves,” said Bailey.
RE / MAX is still looking for acquisitions
RE / MAX made a number of key acquisitions in 2020 to support both the real estate agent and mortgage franchise businesses. The company continues to look for opportunities, RE / MAX CEO Adam Contos announced on the conference call.
“We continue to look for interesting complementary opportunities in and around our core mortgage and real estate franchising businesses that we believe have the potential to significantly expand our market opportunities.”
In 2020, RE / MAX completed the acquisition of First, an AI-based lead nurturing tool, as well as the acquisition of mortgage software startup wemlo and location information company Gadberry Group. The company expects all three net investment acquisitions to have a positive impact on earnings in 2021.
Bailey pointed to the impact of the initial acquisition on RE / MAX agents as the real estate market becomes increasingly competitive.
“The first app is the best tool I’ve ever seen for listing contacts who are most likely to sell a home soon,” said Bailey. “Right now, with such a tight pool of houses for sale, the First App is an absolutely indispensable tool.”
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