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The second quarter of 2024 showcased a varied landscape for real estate and related sectors, highlighting ongoing volatility. While companies like Zillow and CoStar Group reported solid revenue growth, driven by strong performance in residential services and online real estate platforms, others such as RE/MAX and Offerpad struggled with declining revenues and agent losses.
Several companies are refining their strategies to navigate an unpredictable market. Rocket Mortgage leveraged AI to enhance operational efficiency, while Redfin increased revenue despite nearly flat losses. Digital mortgage lender Better saw increased loan production but continued to face mounting losses, reflecting ongoing challenges in the mortgage sector.
The quarter also saw significant developments in the brokerage landscape, with eXp Realty and Compass posting revenue gains despite ongoing agent turnover. Meanwhile, cloud-based service providers like Real Brokerage and Blend showed resilience by achieving positive earnings in a tough market.
Overall, the Q2 earnings underscore the diverse strategies and varying outcomes across the industry, with companies continuously adapting to meet market demands and overcome sector-specific challenges.
Fathom says revenue sharing will help it recruit new agents
Fathom Realty, a flat-fee brokerage, reported a 12 percent increase in its agent count, reaching 12,224 by the end of the second quarter. Despite the growth in agents, the company faced challenges with elevated mortgage rates and home prices, leading to an 8 percent decline in transaction volume to 10,137 deals.
Fathom introduced new commission plans that allow agents to earn a percentage of the revenue generated by agents they recruit, positioning the company for continued growth. However, the quarter ended with a $1.3 million net loss, an improvement from the $4.3 million loss reported a year earlier.
Investors bullish on Blend on Q2 earnings and revenue beat
Blend Labs Inc., a cloud banking software provider, grew both its mortgage and consumer banking businesses during the second quarter, reducing its net loss by 53 percent to $19.4 million compared to a year ago. Although the improvement from its $20.7 million net loss in Q1 was modest, Blend secured a $150 million cash injection in April from Haveli Investments, giving the company more time to reach profitability.
The funding was used to pay off debt from its 2021 acquisition of Title365. Blend’s Q2 results exceeded analysts’ expectations, leading to a 23 percent increase in its stock price, which closed at $3.30 on Friday.
Expedia adjusts H2 projections despite revenue growth
Expedia Group met the high end of its earnings expectations for the second quarter of 2024, despite a challenging macro environment and softening travel demand. The firm reported total lodging bookings of $20.7 billion across all its platforms, including Expedia, Vrbo and Hotels.com, marking an 8 percent increase from 2023.
Revenue for the quarter rose 22 percent to $3.6 billion. Room nights grew by 10 percent, totaling 98.9 million, with Brand Expedia showing nearly 20 percent growth. The company recorded a net income of $386 million, with an adjusted net income of $469 million.
Investors aren’t ready to buy in to Better’s comeback story
Digital mortgage lender Better increased loan production by 45 percent during the second quarter, reaching $962 million and projected it will originate over $1 billion in mortgages in Q3 for the first time in two years. Despite this growth, investors were skeptical, as shares in Better dropped nearly 20 percent after the company reported a $42 million net loss for Q2 and announced a 1-for-50 reverse stock split to avoid delisting from the Nasdaq.
Revenue grew 41 percent quarter-to-quarter to $31.4 million, and by keeping expenses flat at $73 million, Better reduced its net loss by 18 percent from Q1, ending the quarter with $507 million in cash, restricted cash, short-term investments and self-funded loans.
RE/MAX agent count drops as revenue falls for 8 straight quarters
RE/MAX reported a 4.8 percent decline in revenue during the second quarter compared to a year earlier, marking the eighth consecutive quarter of falling revenue as the down market continued to impact the company. The franchisor’s U.S. agent count fell by 6.3 percent, losing just under 1,000 agents in Q2.
The agent count in North America dropped even more sharply, with a 4.4 percent decline in the U.S. and Canada, bringing the total to 78,599 agents at the start of Q3. Despite these challenges, RE/MAX Holdings CEO Erik Carlson described the Q2 results as “better than expected.”
Realtor.com revenue drops 2% as traffic, lead volume remain flat
Realtor.com parent company Move Inc. reported a 2 percent decline in fiscal fourth-quarter revenue, dropping to $143 million year over year. The decrease was attributed to higher mortgage rates and other macroeconomic challenges, as stated by News Corp, which owns Move Inc. Real estate revenues, accounting for 80 percent of Move’s total revenue, also declined by 2 percent.
Realtor.com’s lead volume and website traffic remained flat during the quarter, with 74 million average monthly unique visitors. Despite these setbacks, News Corp’s digital real estate services segment overall saw a 21 percent revenue increase, reaching $448 million, driven by strong performance from the Melbourne-based REA Group.
Douglas Elliman sees revenue tick up in Q2 2024
New York-based brokerage Douglas Elliman saw a slight revenue increase in the second quarter of 2024, providing some relief after facing pressure from shareholders due to its shaky recent performance. Consolidated revenues rose from $275.9 million in Q2 2023 to $285.8 million in Q2 2024, while gross transaction volume increased from $9.9 billion to $10.6 billion year over year.
The company also improved its net loss, which decreased to $1.7 million, or $0.02 per diluted common share, compared to $5.2 million, or $0.06 per diluted common share, a year earlier.
Zillow Q2 revenue exceeds expectations, grows 13% to $572M
Zillow Group’s strong second-quarter performance was driven by better-than-expected results in its residential segment, which helped boost revenue by 13 percent year over year to $572 million, surpassing the midpoint of its outlook range. The company’s mortgage segment led in percentage growth, with a 125 percent increase in purchase loan origination volume, driving its revenue up 42 percent to $34 million.
The rental segment also saw significant gains, with a 44 percent rise in multifamily revenue pushing overall revenues up 29 percent to $117 million. Although residential revenue growth was more modest at 8 percent, this segment, including Premier Agent, ShowingTime+ and Follow Up Boss, contributed the most to Zillow’s success, bringing in $409 million for the quarter.
Real Brokerage sees new highs in revenue, gross profit during Q2
The Real Brokerage posted surprisingly strong second-quarter earnings in a challenging market, with revenue hitting a new high of $340.8 million, up 82 percent year over year. Gross profit also reached a record, growing 79 percent to $31.9 million.
The company improved its net losses, reducing them to $1.2 million, down from $4.1 million a year earlier, with a loss per share of $0.01 compared to $0.02 in Q2 2023. Chairman and CEO Tamir Poleg credited the firm’s results to the resilience and appeal of its business model, along with the efficiencies provided by its unique technology platform.
UWM shares at 3-year high on prospect of refi ‘mini boom’
United Wholesale Mortgage, the nation’s largest mortgage lender, posted a solid $76.3 million profit in the second quarter, paid down debt and positioned itself to capitalize on dropping mortgage rates. Shares in the company are now trading at a three-year high.
Mortgage originations increased by 6 percent year over year to $33.6 billion, the highest level since Q1 2022, with gain margins improving to 1.06 percent from 0.88 percent a year ago. UWM expects third-quarter originations between $31 billion and $38 billion, with gain margins ranging from 0.85 percent to 1.10 percent, consistent with recent performance.
Matterport revenue grows, losses improve during Q2
Spatial data company Matterport saw its total revenue grow to $42.2 million in the second quarter of 2024, up from $39.6 million the previous year, as the company focused on expanding its market share. According to an earnings report released Tuesday, subscription revenue contributed $24.2 million, a 16 percent increase year over year.
Services accounted for $10.9 million, while product revenue totaled $7.2 million. The company’s net loss was $0.45 per share, with a Non-GAAP net loss of $0.02 per share, reflecting a 71 percent improvement from the previous year. Matterport’s gross profits also increased, reaching $19.4 million, up from $15.9 million a year earlier.
Redfin sees Q2 revenue rise, while losses remain nearly flat
Redfin saw its revenue rise by 7 percent to $295.2 million between April and June 2024, according to its second-quarter earnings report. Despite the revenue growth, the company posted a net loss of $27.9 million, slightly more than the $27.4 million loss from the same period in 2023. The report also noted that Redfin’s web traffic remained steady, with nearly 52 million average monthly users, the same as in Q2 2023.
Travelers spent $21.2B booking through Airbnb last quarter
Airbnb continued its strong performance in the short-term rental market during the second quarter, with revenue growing 11 percent to $2.75 billion, driven by robust travel demand and international expansion, according to its earnings report. The company reported a net income of $555 million, a 15 percent decrease from the previous year due to higher income taxes.
Airbnb and its hosts generated $21.2 billion in total bookings, an 11 percent increase from a year ago, with travelers booking 125.1 million nights and activities. CEO Brian Chesky expressed optimism about the upcoming summer travel season during a call with investors.
Offerpad trims Q2 loss, but sales and revenue continue to slide
Shares in iBuyer Offerpad dropped to a new all-time low in after-hours trading Monday after the company reported trimming its losses but also anticipating further declines in revenue and homes sold. Offerpad posted a $13.8 million net loss in the second quarter, a 21 percent improvement from the previous quarter’s $17.5 million loss and a 38 percent reduction from its $22.3 million loss in Q1 2023.
However, revenue during the spring homebuying season fell 12 percent from Q1 to $251.1 million, with home sales also down 12 percent to 742. Offerpad expects Q3 revenue to decline further, projecting between $185 million and $225 million, with home sales expected to drop to between 550 and 650. Executives are pivoting to a buyer’s market by narrowing the scope of homes they evaluate for purchase and adopting a more conservative approach in their underwriting model.
Rocket says AI helping it grow capacity and keep expenses flat
Rocket Companies saw its net income rise by 28 percent to $178 million in Q2 2024, as the company leaned heavily into artificial intelligence tools to scale its business and grow market share. Rocket Mortgage, the Detroit-based fintech’s subsidiary, increased mortgage originations by 10 percent year over year to $24.7 billion, with gain on sale margins improving to 2.99 percent, up 32 basis points from a year ago.
Revenue for the quarter grew 5 percent to $1.3 billion, while expenses remained flat at $1.1 billion. CEO Varun Krishna highlighted the company’s significant investments in data leadership and infrastructure and its strategic partnerships with industry leaders.
Opendoor’s revenue declines as losses also grow in second quarter
IBuyer Opendoor reported a 24 percent decline in revenue year over year to $1.5 billion in the second quarter of 2024, as the company faced a slow market. This was a 28 percent improvement from the previous quarter, with 4,078 homes sold.
Opendoor recorded a net loss of $92 million, a sharp drop from the $23 million positive income it saw in Q2 2023. However, this loss improved from the $109 million loss in the previous quarter. The company’s gross profit was $129 million, down from $149 million a year earlier but up from $114 million in Q1.
Anywhere’s revenue remains flat during Q2 at $1.7B
Real estate franchisor Anywhere reported flat revenue year over year in the second quarter of 2024, as the company made significant payments toward settling a commission lawsuit and resolving a 1999 legacy tax issue related to its former parent company, Cendant. Despite these challenges,
Anywhere saw a 3 percent increase in combined closed transaction volume, with units down 5 percent but prices up 8 percent. This marks the second consecutive quarter of rising transaction volume. The company’s net income increased by 58 percent to $30 million, with adjusted net income up 37 percent to $37 million year over year.
Revenue rose and agent loss slowed for eXp Realty in Q2
EXp World Holdings saw its revenue grow 5 percent year over year to $1.295 billion in the second quarter of 2024, according to an earnings release on Wednesday. The company reported a 3 percent increase in net income to $11.8 million despite facing higher taxes on continuing operations. Adjusted EBITDA also rose by 22 percent to $32.8 million year over year.
The brokerage’s agent count continued to decline, but at a slower rate, with a 1 percent decrease to 87,111 agents and brokers, an improvement from the 2 percent decline reported in Q1.
Compass posts gains in revenue and agent count in Q2 earnings
Compass saw its revenue rise to $1.7 billion between April and June 2024, adding thousands of real estate agents to its ranks, according to its Q2 earnings report released Wednesday. Despite uncertainty in the housing market, Compass reported significant gains in revenue, transactions and agent count.
The 14 percent year-over-year revenue increase was driven by an 11.4 percent rise in transactions, even as the broader residential real estate market saw a 3.3 percent decline in transactions. This revenue boost enabled Compass to profit $20.7 million in Q2, a sharp turnaround from the $47.8 million net loss it posted during the same period last year.
CoStar Group revenue rises in Q2 as Homes.com bookings hit $55M
CoStar Group reported a 12 percent year-over-year revenue increase, reaching $678 million in the second quarter of 2024, according to its earnings call on Tuesday. The Homes.com Network saw significant growth, with traffic rising 73 percent year over year to 148 million average monthly unique visitors.
Despite the strong revenue performance, CoStar’s net income dropped to $19 million, down from $101 million in Q2 2023. CEO Andy Florance highlighted the company’s success, noting that Apartments.com and CoStar achieved double-digit revenue growth despite market challenges.
Fannie Mae, Freddie Mac boost profits in Q2 despite a slow spring
Mortgage giants Fannie Mae and Freddie Mac continued to grow their net worth in the second quarter of 2024 despite a sluggish spring homebuying season. Both companies increased their profits as firm home prices and low default rates allowed them to release billions of dollars previously reserved for losses.
Although Fannie and Freddie don’t make loans directly, they guarantee payments to investors who purchase mortgage-backed securities, which fund most U.S. home loans. In Q2, the mortgage giants guaranteed $172 billion in single-family mortgages, a 44 percent decrease from the $310 billion they guaranteed a year ago.
Jessi Healey is a freelance writer and social media manager specializing in real estate. Find her on Instagram, LinkedIn, or Threads.
