This article was shared here with permission from Mike DelPrete for Inman Intel, a data and research arm of Inman offering deep insights and market intelligence on the business of residential real estate and proptech. Subscribe today.
Why it matters: The data shows, in very real terms, what “investing for growth” really means, and which companies are best positioned to grow mortgage as a meaningful adjacency.
- Zillow is the standout, doubling its MLO (mortgage loan originator) headcount over the past 14 months — during a very difficult time to be in mortgage.
- But one other company has done so, seemingly back from the abyss: Better Mortgage.
- After shedding over 1,000 MLOs during the dark days of 2022, Better is back — or at least investing for growth — by doubling its MLO headcount over the past year.
- Like Zillow, its goal is to attach mortgage services to its core brokerage operation, but in contrast to Zillow, its headcount is shrinking (down 30 percent since acquisition).
- Redfin’s mortgage business is still larger than Zillow’s, but unlike Zillow, it’s not growing.
The bottom line: My latest podcast guest, Greg Schwartz, CEO of Tomo and former president at Zillow, summed up the situation well: “Growth is in our control.”
- Meaning that even in a down market, companies can uncover key insights and grow their market share – as long as they have cash to invest.
- Redfin’s high debt, dwindling cash, and unprofitable core business make it difficult for the business to invest for growth, especially compared to Zillow, which has billions in free cash to match its lofty ambitions.
Mike DelPrete is a strategic advisor and global expert in real estate tech, including Zavvie, an iBuyer offer aggregator. Connect with him on LinkedIn.
