As brokerages work to grow their revenue and increase profits, many have looked to core services, such as mortgage, title, home warranty, escrow, and property and casualty insurance as an extra source of income.
A total of 65 brokerages made the 2022 RealTrends 500 Core Services rankings. The brokerages were ranked by the number of core services transactions completed. It should be noted that these rankings rely on company submitted data that has not been verified by third-party sources.
After trailing HomeServices of America, Inc. for a number of years, the 2022 list was topped by Realogy Brokerage Group which completed a total of 294,757 core services transactions, up from 290,856 a year prior. HomeServices of America, Inc (287,965 core services transactions down from 302,060 in the 2021 rankings), Hanna Holdings, Inc (70,966 core services transactions, down from 72,984 a year ago), First Team Real Estate (29,054 core services transactions, down from 39,071 a year ago) and Crye-Leike Real Estate Services (20,659 core services transactions, up from 19,098 a year prior) rounded out the top five.
These brokerages have made up the top five for the past four years.
“We have been at this now for some 35 years, so we’re not new to the game,” Don Casey, the president and CEO of Realogy Title Group, said. “Our brokerage was really built on a series of acquisitions and a lot of those brokerages had their own title and closing operations, so we formed our title group from that. We also have our own underwriter, the mortgage joint venture with Guaranteed Rate, as well as Realogy Insurance Agency to provide homeowners insurance, so it is all very inclusive. We look at things on a much more consolidated basis and we have a vested interest in streamlining things.”
HomeServices of America CEO Gino Blefari shared similar sentiments about his brokerage: “We have the most experienced leadership across our core services and through our system of accountability and teamwork have mastered the ability to deliver these services in a way that resonates with today’s consumers. Owning and operating the full suite of services—brokerage, mortgage, title/escrow and insurance, moving services, home warranty, inspection and others—translates into increased flexibility and represents the ability for HomeServices to diversify and take advantage of the fluid real estate market.”
While the rankings look at five categories of core services (mortgage, title, home warranty, escrow, and property and casualty insurance) not all brokerages offer all of the services. HomeServices of America was the only brokerage that reported transactions in all five service categories. While First Team Real Estate reported transactions in just three categories (mortgage, title and escrow), with this being the first year the brokerage reported mortgage transactions (273 transactions).
For all of the top five, except for Hanna Holdings, the majority of the brokerages’ core services transactions came from title transactions, with Realogy seeing a total of 219,862 title transactions in 2021. Hanna Holdings recorded a slightly larger number of property and casualty insurance transactions (21,373) than title transactions (20,621), continuing a trend that can be seen in historical data, however, the number of title transactions is on the rise.
Although Hanna Holdings saw a slight drop in the total number of core service transactions it completed in 2021, F. Duffy Hanna, the president of Howard Hanna Financial Services was pleased with the overall performance of the brokerage’s core service providers.
“Our attach rates were strong this year, but naturally we are looking to improve them,” Hanna said. “The key to this whole business is relationships and building confidence and trust between our service providers and our real estate agents. In a crazy market like this it is important for agents to have service providers they feel like they can trust and rely on.”
For Blefari, reliable service is also key to improving HomeServices of America’s attach rates. “Improving capture rates is simple,” he said. “Every one of our services must provide unparalleled customer service.”
While they may not be what immediately comes to mind when a homebuyer or seller thinks about the function of a brokerage, there is no doubt that core services are very important to brokerages and their overall function of helping clients buy and sell their homes.
“Core services have always been extremely important and they are becoming more important everyday,” Hanna said. “They have always been part of the fabric of our company. A lot of companies expand core services through acquisitions and affiliations, but we have realized that you call them core services for a reason, they are part and parcel of what we do.”
Casey, Blefari and Hanna see having in-house core services providers as a huge advantage for real estate agents and brokers, as well as homebuyers and sellers.
“If a client asks their agent a question about financing, the agent has someone within the brokerage they can turn to for help, regardless of whether or not the client is using our mortgage service,” Hanna said.
Casey added: “People want that one-stop shop and the one thing that can make or break a real estate professional is service. So, we focus a lot on the customer experience. The real advantage of having our own mortgage and title companies is that we are never on hold waiting for someone to pick up our call. There’s a lot of familiarity.”
Looking ahead, improving attachment rates is a goal both Hanna and Casey have for their respective firms.
“The relationships within our brokerages and branches really drives our attach rate and we are always looking to strengthen those relationships,” Casey said. “We also have a few consumer-facing applications that are also helping us. There is Power Snap, which shows the seller exactly what their net profit will be selling through Realogy and it shows the buyer what the end cost of buying a home will be, including all the fees, mortgage, etc. If the buyer wished to continue, they can order the title right through the app. We have also created an app with Coldwell Banker called HomePlace and it allows buyers and sellers to purchase their mortgage, title, just do everything through an app on their cell phone. By going direct to the consumer we have been able to grow our attach rates.”
In the 2022 RealTrends 500 transaction sides rankings, HomeServices ranked No. 1 with a total of 388,098 transaction sides. Realogy came in at No. 2 with 376,892 transaction sides, while Hanna Holdings ranked at No. 8 (124,016 transaction sides), Crye-Leike Real Estate was No. 16 (25,781 transaction sides), and First Team Real Estate was No. 61 (10,128 transaction sides).
Complete breakdown of real estate brokerages who ranked for core services below.