HomeSmart, a tech-forward brokerage that promotes “low fees, high value,” has launched a new model that allows agents to choose their commission structure and invest in revenue sharing.
In a press release, HomeSmart touts the referral-based HomeSmart+ as “a revenue sharing program that provides a way for agents to earn additional income beyond their own transactions, and an opportunity to [put] money into their retirement.”
To participate in HomeSmart+’s revenue sharing, agents will forgo the company’s traditional 100 percent commission structure for an 80 percent model, capped annually, in exchange for earning money on the revenue generated from agents they’ve referred into the program.
HomeSmart elaborated on its new program in an email to Inman, stating, “When a HomeSmart+ Agent refers another Agent, who joins the HomeSmart+ program, the program counts that as an ‘Active Personal Referral,’ and the Referring Agent receives 25% of the revenue share amount — plus, the potential additional Check Match Bonus and National Pool Bonuses.”
The remainder of the 80/20 commission split will is divided equally among the greater revenue share pool and company operations.
HomeSmart launched in 2000 from Phoenix, Arizona, to provide the industry with a new model that emphasized technological efficiencies and reducing costs for agents to operate.
In addition to its day-to-day back-office tech, HomeSmart offers agents and their clients a mobile app, HomeSmart Client. The app empowers consumers to search and share listings, schedule showings, communicate with agents, submit offers and oversee transaction progress among other buying and selling tasks.
However, beyond technology, which is a common offering, HomeSmart provides agents with a host of employment benefits, such as group life insurance, tiered prescription plans, concierge service options, identity protection, legal expertise, and pet benefits which are uncommon in the industry.
HomeSmart has made a number of regional acquisitions to broaden its industry footprint. In 2019, it bought TriStar Realty, a mid-Atlantic-based independent brokerage with more than 650 agents, according to an Inman report.
Earlier this year, it took on another 2,000 agents in six states when it acquired Palmer Properties, which Inman reported “was ranked as the 63rd most productive brokerage with more than 8,500 closed transactions in 2019 and ranked 102nd on the Swanepoel Mega 1000 with $2.3 billion in transaction volume.”
HomeSmart+ represents an emerging trend in the industry as it relates to agents seeking alternative forms of value from their brokerages. Inman’s The New Normal: What if agent pay was more than just commissions? looked at the issue extensively.
In the Inman story, Russ Cofano, chief operating and strategy officer for title company NexTitle, said that technology isn’t always the main reason why an agent moves brokerages.
“Agents don’t go to eXp because of the [virtual world]” he explained,” he said. “That’s not the draw. What is the draw is the split, the cap, the stock awards and the revenue share.”
EXp offers agents a share of revenue from referred colleagues, while Keller Williams dropped its long-time revenue sharing plan in 2020.
However, commission structure in general is currently under fire in Washington, and industry antagonist, pro-salary Rex has become a vocal proponent of altering the status quo.
There are 194 HomeSmart offices in 40 states as of today. The company states it has more than 23,000 agents nationwide.
Have a technology product you would like to discuss? Email Craig Rowe
Craig C. Rowe started in commercial real estate at the dawn of the dot-com boom, helping an array of commercial real estate companies fortify their online presence and analyze internal software decisions. He now helps agents with technology decisions and marketing through reviewing software and tech for Inman.
