Life hasn’t been easy lately for U.S. real estate brokerages. Unaffordable housing has been exacerbated by constrained inventory levels, stubbornly high mortgage rates, historically low home sales, potential commission rate compression and a never-ending string of legal threats.
To adjust to the stagnant and shrinking housing market, brokerages are trying to add real estate agents in bulk as a way to grow their businesses. While this approach certainly isn’t new, it’s taken on added importance in a highly challenging market. And as the industry contracts, it’s gotten harder to add head count, particularly because agent migration mobility is in decline, according to the Agent Movement Index from Relitix.
Excluding the short-term drop and immediate recovery during the first few months of the COVID-19 pandemic, the Relitix index is at a 10-year low point.
“The combination of political uncertainty and major regulatory changes has clearly influenced agents’ decisions to stay put,” Relitix founder Rob Keefe wrote in the company’s October index report. “However, as these factors stabilize, we anticipate a potential rebound in agent mobility. Brokerages should remain vigilant and prepared for a possible uptick in movement as the market adjusts to the new normal.”
Sourcing from financial filings, HousingWire compiled agent counts at publicly traded brokerages. While the year-over-year growth rates for each of them has fallen since 2022 — when the housing market was roaring — there’s a clear divide between rapidly growing brokerages and ones that are stagnant or falling.
Newer companies are luring agents with remote-work arrangements and more developed technology platforms that help with logistics, marketing and metro-level reports. Most older brokerages remain considerably larger than younger ones, but their growth is either negligible or has turned negative.
The two brokerages that are adding the most agents are Compass and The Real Brokerage. While its annual growth rate has slowed since regularly topping 100% throughout 2022, Real’s year-over-year gain in agents was 78.8% as of third-quarter 2024.
In the process, Real’s total agent count of 21,700 has zoomed past Compass, Redfin and Fathom Realty.
Compass, however, is holding its own. CEO Robert Reffkin has made no secret of his ambitions for growth, stating on an earnings call this year that he wants Compass to achieve 30% market share in 30 unspecified major metro areas.
While it’s yet to be seen whether it gets there, Compass is posting impressive year-over-year gains. It grew its agent count by 24.8% year over year in Q3 2024, bringing its total to 17,542.
“While Compass is likely growing agents at a decent organic clip, the headline growth is a bit skewed by acquisitions,” John Campbell, managing director at Stephens Inc., told HousingWire in an email.
“Real Brokerage seems to be the only player that is rapidly (and organically) growing agent count, which we think is partially due to its value proposition and partially due to the early stage nature of its ascension. eXp looked similar to Real during that phase of its growth story.”
Fathom Realty has also grown rapidly in the past three years, expanding from 6,045 agents in 2021 to 12,383 today. But the company’s rate of growth has slowed considerably. In 2022, its year-over-year agent growth was 49%, but it has since fallen to 9.3%.
It’s a different story at the legacy brokerages. Anywhere (182,100) and Keller Williams (153,834) are the largest in the industry, but their growth has turned negative with head counts falling by 8.4% and 4.3%, respectively, in Q3 2024. The total for Keller Williams includes agents in Canada.
RE/MAX’s agent count has fallen from 62,261 in Q1 2021 to 52,808 in Q3 2024. While not a legacy brokerage, eXp Realty’s growth has largely flatlined after growing from 50,333 in Q1 2021 to 82,856 in its most recent filing.
“I think the agent-count declines with the larger players largely mirrors the broader industry trend of contraction, which isn’t surprising given the fallout in US housing and, our view, that the market was already oversaturated,” Campbell said.
