Our Storii Time hosts, Saad and Mike dissect the impacts of the latest big real estate headline: the announcement of Compass x Anywhere Real Estate, and what it means for our industry.
Mike: This is the greatest show.
Saad: You’ve yelled at me for driving and driving before.
Mike: I know. I know. I’m not looking at you though. I know. I know. I know. I know. know. I know. I know. know. know. know. know. know. know. know. know. know.
Mike: The levee has broken.
Saad: Yeah, definitely. Joe, what’s going on? Thanks for joining. Joe Hoppis.
Mike: He’s a Joe! Hey! Hey, buddy. He just led a breath work class over the weekend, actually, which probably I could stand to breathe a little bit more.
Saad: Speaking of breathing, how’s your day been? know anybody who’s listening, including Joe, Mike’s been a busy guy the last few days, maybe the last couple of weeks. how’s the day been?
Mike: Good. We’re good. Obviously, we had our coaching call. We had a little back and forth on my South Boston listings. That’s doing well. Just met a couple for they want to sell their place in the new year and buy one out west of the city. Sorry, I am trying to find a side street here.
Mike: My God. Oh, here we go. Here we go. I’m across from Wallaston Golf Club. I get I can pull in there.
Saad: You should be all right. You should be all right.
Mike: I’ll just park in front of this stranger’s house. All right.
Saad: I remember the last time, yeah, I maybe I’ve done this a couple times where I was driving and driving. The last time I did it was when Brady was our guest and both of you guys were like, what are you doing? We both like, what is going on? But yeah, Mike’s been a busy guy, very busy and it’s going to lead well into our topic of the day. Yeah, you know, just because, I don’t think this news changes anything. for for I mean, obviously it’s big. is big news, like in terms of like the landscape and what have you. But for agents and generally for consumers, at least uh at least right now, uh nothing changes. People have needs. People got to buy. People got to sell. And agents need to stay busy. This news doesn’t change anything in terms of kind of what you’re doing day to day as an agent. So that’s kind of like really is the headline.That’s why Mike continues to stay busy. Things are still happening. We’ve got several listings coming on. The rest of our agents are starting to get busy, which is super exciting. There a lot of buyers in the pipeline. I think that’s really the headline of it. Let’s get into this deal, this Anywhere Compass deal, which was announced a couple of days ago.
Mike: Wasn’t it yesterday?
Saad: Biggest merger in real estate. You have the second largest real estate brokerage by volume with Compass and Anywhere and some people may not know anywhere but anywhere it holds a bunch of household names. You’ve got Coldwell Banker, Century 21, Sotheby’s, a few others as well. Those are probably the most marquee names. A lot of agents like 300,000 plus or something like that. When you take the first, the biggest brokerage, the second biggest brokerage, That’s a huge deal in any industry. So, I think they’re to have somewhere around like 20 % market share uh when it comes to volume, amount of deals, all that kind of stuff.
Saad: So it is a big deal in the grand scheme of things. But when you saw the news and maybe read up on it a little bit, did you have any kind of general thoughts? I know obviously grand scheme of things doesn’t really change anything for us. But did you have any thoughts in terms of what it might mean? I don’t know. A months from now, a year from now, couple years.
Mike: A bunch, they all got clogged and then I had no thoughts for little bit, but now I’m back to having thoughts again. First off, it’s our industry is full of contractors, right? Like everyone for their, unless you’re part of the actual corporate structure of running the brokerage, all the agents, all the brokers, right? That are underneath these different brokerages are 1099s. Maybe they have to sign something to like stay on, but you’re not beholden to any one broker. So that’s why like there’s more freedom of movement within the industry itself, which is why people like, you know, people move for what reason their manager potential help…in terms of support staff. That’s more local to the offices within the larger brokerage, splits, obviously, and then just general culture.
Mike: And so I thought of it from a cultural perspective. First of all, people leave Compass or go to Compass because they’re feeling a certain way about Compass. Same thing for Coldwell. That’s a different, very different vibe than is at Compass and Century 21 is different and all those things. And to now have that under all one umbrella, you got to think there’s like a eroding of each different business. And that my initial thought was like, what’s keeping people from from jumping there and going somewhere else? Like, does do all those agents actually stay with the trust that one company is taking over and they’re going not going to change the the vibe of the company that they’re currently with.
Saad: Think culturally, at the end of the day, so culture you’re absolutely right. One thing that’s a benefit to those uh agents that were under Sotheby’s, Callow Banker, Century 21, any of the other brands under anywhere, is the technology. Compass was a, or is, a bit more of a tech forward company, at least they tout themselves as such. I think they do have, our real estate coach is from Compass and stuff like that and I’ve seen some of their tech platforms and the things they’ve built out internally. It’s nice and it’s gonna probably be, it’s gonna be a better experience for the agent, at least the agents that buy in. Some agents are a little bit more old school and struggle with technology….it’s probably gonna weed them out. I think there’s a possibility of that, because you gotta follow the parent company’s processes, and if you don’t, you’re get left in the dust. So think there’s gonna be some of that happening. That is good for, I think, those agents that buy in. It’s good for consumers, but not good for those agents that maybe were stuck in their ways. So, I think that’s something that we’re gonna see. I think, too, I think when one brand, one company is holding 20% of the market share, they’re have a little bit of control in the industry in terms of commissions, splits even, things like that. I think at the end of the day, it’s enough. It’s not like they have 50% shares, 60% shares, so it’s not going to completely take over. But in this era right now of more and more of these acquisitions happening, I mean, who knows what the future holds on that, right? So the more of, I don’t wanna say monopoly, but I’m gonna say it, the more one company takes over an industry, the more risk there is of not having fair play, or a fair market, I should say, in the industry. Both in terms of commissions, so that impacts sellers and buyers and then also splits, which impacts agents.
Mike: Yeah, I agree with that. And that’s that was my point too of like, who’s to stay like say that the volume of agents that are there, like with the combination that’s not decreasing, right? Right from there. It’s like, OK, like I’m going to switch out. There’s other battles being fought right now. The biggest one…literally that, Joe, thank you. That was literally my next point was it seems like they’re not fighting like each other real estate brokerages. It’s the battle for against Zillow, right? Zillow has slowly over time crept into different crevices. They were a search engine. Then they became house buyers, you know, for a time. I don’t know if that program is still in existence.
Saad: It’s not. But that’s at least last I kind of looked into that it failed miserably. They lost tons of money on that.
Mike: Yeah. Yeah. Right. Like I don’t know. It just seemed a little far reaching for what they originally the core of their business was. now it’s OK. Like if Zillow is the monopoly or duopoly with you know Redfin’s probably a distant second in terms of search. But Zillow has become like the household brand name of looking for properties with the MLSs and the fact that me as an agent or us as agents have to put stuff onto MLS to list it. Zillow then captures that and then sells the leads back to the agents. And then beyond that is taking chunks of the referral for that. Like there seems to be with Redfin and Compass and Zillow and then you have Mauricio also trying to start a different MLS outside of like the gnar game. It just I don’t I don’t know It that intimately to say like what will the future bring but I know that those are the competing entities Where where are your properties going to be listed? How are they going to show up? How are they going to show up and then what money are they extracting almost like double dipping for the fact that they’re selling leads back to agents for some subscription?
Saad: I think part of it definitely seems like I think anybody who’s been following Compass and especially the stuff that they’ve been involved in in terms of those pocket listings. That whole conversation recently where they were trying to make that a standard and that getting a lot of pushback, they’re kind of putting, this is a power play too, so they can have a bit more control, actually a lot more control over those types of initiatives and increase at the end of the day the bottom line.
Saad: One other thing I think it’s worth mentioning though is that this does I think allow smaller brokerages…I think there’s gonna be two schools of thought in terms of what smaller brokerages like this, know, like what they kind of like have the ability to do with this news, especially as it matures and things like that in the industry. I think on the one hand, people might think, oh, know, Compass gets so big that it’s gonna make it harder for smaller brokerages to really stand out and kind of like really be able to compete, especially if it starts to impact commissions and splits and things like that, in terms of retaining agents and et cetera. Again, it remains to be seen if this really leads to increasing commissions or reduced commissions, reduced splits, who knows, right? But I think that is something that, I’ve read it in a couple of different instances in terms of how it can impact the industry. But on the other hand, I think given a lot of these agents are going to be under one umbrella now and they’re going to be forced to follow a certain way, it allows these smaller brokerages, these more- Differentiation. Yeah, these companies that are already differentiating and trying to … Some companies like, don’t know, Torii, you know what I mean?
Saad: Like, it’ll allow them to kind of pick out a little bit more. And I think there’s something to be said about having that kind of control as well and just being able to continue being yourself. Not trying to poo poo on Compass if anybody listens to it that way. But I think that is something I thought about as well. like, this is actually a good thing. At least in terms of the differentiation piece.
Mike: Yeah.I think there’s a difference between having stuff baked in, you know, Compass has its, you know, whatever, Compass exclusives, which who knows what, you know, is going on there and who takes advantage that. There’s stuff baked in that they tout how often that is used. You know, I doubt it’s much less than it’s being advertised. We, I think no matter what company you work for as an agent, you are responsible for building your own sphere and contact base of things, right? If you do a good job of keeping up with your sphere and expanding it, then you don’t need as many Zillow leads once you’ve matured as a broker or an agent, right? Like you’re getting them from you. So you’re not paying for those things to be sold back to you. Same way with the listings. You know, we join different networks. We have different channels of stuff that we hear about…properties coming on the market. You keep tabs on agents that you know, it’s all of that, like from your own source or your small group versus some national thing that is is touting, you know, the ability to do that without the work being put into it.
Saad: Right. Yeah, I literally was having that conversation with Rasheed. Rasheed is one of the guys on our team. Like he he asked me about that deal, too. And I was like, Rasheed remember, mean like at the end of the day the brand is you. The brand is you. Right? Yes. Okay. You might be working with us at Torii or you might be working for Compass. You might be working for any of these Anywhere brands. But the brand is you. People work for you. People work with you because you are you and you need to kind of continue to build that up no matter where you are. Because that’s what people are going to remember. People are not going to refer you because you work at a particular broker, they’re going to refer you because you gave them an amazing experience.
Saad:I saw this in one of the reels I was looking at earlier today. Somebody was talking about the whole deal, the Compass Anywhere deal, but at the end of it he was like, look, this news doesn’t change the way you treat your clients, the way you market, it doesn’t change the way you’re following up with them, what kind of service you’re providing. So, just get after it, right? That’s kind of the headline. That really is the true headline. There’s been so much other news in real estate over the last year and a half with these buyer agency agreements, with the decoupling of commission, with this new home inspection law in Massachusetts, obviously the Redfin x Rocket merger or acquisition, I think, Rocket acquired Redfin. All the stuff that Zillow’s been doing, right? And now this, but what has really changed in terms of the day-to-day for an agent? I would say not much.The same things apply. Same kind of tenants apply. And I think that’s important for any agent. Don’t get lost in these headlines, right? Like your business is your business and you need to keep doing a good job for your clients. That’s it.
Mike: That’s it, man. That’s kind of it. It’s just like, you get like, you know, kind of that next rung outside your sphere, like some influence and stuff. That’s what I’m saying. Like people join stuff for different culture and okay, am I around a lot of people that kind of do approach the business in the same way as me. But once you get beyond like your immediate either team or like your local office or things like that, like the brand really has much less effect on what you’re actually doing day to day. I think; it’s the immediacy of people that you talk to and see every day.
Saad: Exactly. mean, I’m pretty sure that none of my, I mean, yes, like the stock market cares about this, right? Cause Compass is a public company. I don’t know if Anywhere, I think Anywhere is as well, but like the stock market cares about this. People in real estate care about this, right? A lot of the real estate titans, so to speak, are talking about it. But our clients don’t give two shits about this. They don’t care at all about this. Our future clients don’t care about this. They’re probably never going even know. I would say that’s kind of the headline for me and for all of us is focus on the stuff that matters and the stuff that you can control. Just like these other things, it might have a minuscule or micro impact like you know for a day or maybe a few weeks or maybe like you know down the line it might have a larger impact on the industry but locally and hyper locally it doesn’t matter at all. So keep at it if you’re an agent that’s either on right now or sees the recap, think, just focus on the things that you can control, which is your business and the way you kind of handle it. And keep getting better at it because that’s how you’re going to differentiate yourself because most agents out there…
Mike: I mean, we know that. So yeah. And there’s third party tools for everything, right? Like we don’t, what do we use? A CRM that’s different, right? That outside of our, that anybody can subscribe to. We use uh signature tools that are, anybody can access. Like not a lot of this stuff is. You use a good email platform, a document sharing platform. You’ve got a communication tool.
Saad: I love that until now we weren’t using the names of the things that we were using. But yeah, all these things, there are so to speak tech stack, right?
Saad: in the tapestry behind you. know, I mean this is, that’s my home. One day, I’ll give you a digital tour or you could come over and I’ll show you. But that’s what we do around here. yes, I think like, yeah, to that point, that news is interesting right now. The stock market of course cares about what the people that really matter to us are clients and the agents that decide to join our team and things like that. Meaningless in the grand scheme of things.
Saad: Any last points you want to bring up, Mike? think that covers it.
Mike: Yeah, that’s most of it. I think people associate us with Torii because it’s small and we’re the ones running it, right? But if this was like a thousand agents or something like that, I don’t think anybody would know what, at a point, like what, it’s Saad or it’s Mike or it’s whoever. That’s it.
Saad: Focus on your brand, not the brand that you work with. I will say this….think that the brokerage you’re at does matter in terms of mentorship. Especially if you’re new to the game, you’re not. If you’re looking to just grow and what have you, I think who’s around you and how they support you does matter. But you can get that at a super small brokerage, you can get that at a huge brokerage. That really just depends on who that person is that’s mentoring you, coaching you, et cetera, versus the actual brokerage itself.
Mike: Yeah, that’s that hyper local piece or people that you actually have access to. If you go to a company that has 300,000 of your position, then the guy with the little headset mic that’s on stage welcoming you to the whatever event, Is it just like, “Yea,then we got Creed to play for the afternoon session.” Bullshit is like, whatever.
Saad: Listen, headline, focus on your business. Treat people well. Nate, what’s up, man? Thanks for joining. If you want to share your thoughts on the Compass Anywhere deal, please feel free. I think like if you’re a real estate professional, don’t get caught up in the news because your clients aren’t getting caught up in this news. They don’t even care about it. Do the best for your clients because they’re what drives your business and they need the help, especially in the market that we have right now.
Saad: Let’s talk about Greater Boston specifically. We talk about this ad nauseum but prices are high. interest rates are still high, right? Yeah, I know they’re dipped a little bit, great, but it’s still hard to buy right now, like that’s just a fact. A lot of people who can only put 5-10% down, does it make sense for them to buy right now? I that’s a real question they need to be asking themselves and you should be kind of coaching them on that. Be responsive, follow up properly, right? And just be there when they need you, right?
Saad: That’s the key stuff that you should be focused on, not on number one and number two brokerages combined.
Mike: Whenever you call me, I’ll be there.
Saad: And somebody who will sing to you while you’re in the I’ll be there.
Mike: I really need voice lessons to stop offending people.
Saad: If you had voice lessons, if you got voice lessons then I couldn’t sing sometimes on this. That would make me look bad.
Mike: I guess you need a flaw, guess.
Saad: Bernie Molapali, what’s going on? Thank you for joining. We’ve got Nate, Joe. Joe, thank you for the comments and your participation. Super helpful.
Saad: But yeah, mean, listen. Don’t get caught up in the headlines. Focus on you. Focus on your business. Focus on your clients. And consumers, there’s a reason why consumers aren’t even on this live right now, because they don’t care about this deal. That’s a fact. We got more real estate professionals in here than anybody else. Thanks for joining, everybody. That’s Mike. I’m Saad. This is Storii Time. And that’s my cat in the background. See you next week.
Mike: Alright, bye guys.