RE/MAX CEO: Don't expect to 'get rich off somebody else's back'
At a conference this week, Nick Bailey said the company’s value lies in its strong brand identity and agent experience — not downlines or profit sharing.
Key points:
- RE/MAX hosted its Broker Owner Conference this week in Chicago with a focus on growth.
- At the conference, CEO Nick Bailey reaffirmed the company’s principles and strategies, and highlighted RE/MAX agents' above-average experience.
- He pushed against the theme of downlines, which he said is no substitute for the core business of selling houses.
At RE/MAX's Broker Owner Conference this week in Chicago, company leaders reaffirmed the brokerage's commitment to its agents but also took aim at competitors.
A blog post about the event published by RE/MAX on Monday appears to target firms that utilize revenue-sharing models, such as eXp and Real.
"Having a value proposition based on helping agents and teams close more sales — rather than chasing downlines or discounts — gives RE/MAX brokerages a distinct edge in attracting serious professionals," the post begins.
That comment can be attributed to RE/MAX President and CEO Nick Bailey, the company confirmed. During a call with Real Estate news, Bailey elaborated on this theme, suggesting that recruitment tools like downlines can be detrimental to an agent's success in a sales career.
"For anyone that thinks they're going to have a profit share, a downline, or they're going to get rich off somebody else's back, that's not going to happen," he said. "You are a successful agent in this business because you sell a lot of houses, and that's what we do best."
And when inventory is tight and competition for leads is stiff, experience matters, Bailey added.
"The reality is, two years ago, there were a lot of order takers in this business and a lot of people that didn't have the foundation of what they needed," he explained, noting that the typical RE/MAX agent has on average 15 years of experience versus the industry average of just 7.
"The number one reason that consumers hire an agent is because they trust them. That is what it's all about," he said of RE/MAX's value proposition to consumers.
Despite Bailey's push against downlines and his emphasis on helping agents close sales, RE/MAX has been dealing with a declining U.S. agent count over the last two quarters. The company's second quarter earnings report noted that while global agent count increased, U.S. agent count fell by 6.3% — an even bigger drop than in Q1, which saw a 5.4% decline.
Meanwhile, eXp has seen its ranks grow steadily. Last week, eXp announced that its total agent count of 88,248 represented an increase of 7% year-over-year.