Real Brokerage reports a strong third quarter and previews key technology innovations

“I think we’re approaching a point where we have a critical mass of features and incentives and are aligning with our agents to drive mass adoption of our support services,” Poleg said during a Q3 earnings call. “Next week we have our annual RISE conference, where we will announce what I believe is the biggest technology innovation we have announced since the company started.

“That innovation will have a huge impact on our ability to connect titles, mortgages, wallets and insurance down the road. I think we are very close to a meaningful change in the adoption of our support services.”

Real closed 53,512 transactions in the third quarter – up from 35,832 a year earlier – with total transaction value rising 49% to $21.4 billion.

At the end of October, the company reported more than 30,700 agents on its platform.

“There is volatility in the trend of brokers,” Poleg said. “That said, I think the platform is delivering more and more value as we continue to make progress. I think the lower (agent churn) numbers reflect the value and the fact that the platform is becoming more and more sticky.

“I also think that as agents think about some of the alternatives that are out there, I don’t think there are any better alternatives in the real estate space. And that’s probably what these numbers indicate.”

Automation and AI

Chief Operating Officer Jenna Rozenblat highlighted the company’s increasing reliance on automation and artificial intelligence (AI) to improve operations.

“In September, we launched Real’s dedicated AI automation team, focused on using AI and workflow automation to reduce manual or low-value processes across the organization,” said Rozenblat. “In the first few weeks, the team delivered more than a dozen live automations, collectively saving the company more than 10,000 hours per year, equivalent to several full-time positions.”

Rozenblat said these automation initiatives have also improved agent satisfaction and retention.

“Importantly, these improvements translate into stronger agent retention, evidenced by our revenue churn, which fell to 1.4% in the third quarter – the lowest level in more than two years,” she said.

Title and mortgage operations

One Real Title generated revenue of $1.3 million, down from $1.4 million a year earlier.

Leaders attributed the decline to the phasing out of several joint ventures (JV) as they transitioned to state partnerships.

“We put a lot of emphasis and focus on support services – and especially on the title, I would say,” Poleg said. “At the beginning of the year, our seizure rates were generally between 2.4% and 3%. We then transitioned from team-based JVs to state joints, and that transition created a headwind, about minus 50% for us as a company.

“In September we had a rate of 3.7%, so I think we’re making some progress on the rate front. The rate on the new JVs is around 35%, and I think we can get a lot higher, but we’re seeing a lot of momentum in some states.”

Revenue from one Real Mortgage increased 47% year over year to $1.8 million. The division now includes approximately 100 loan officers, with more than 60 participating in the Real Originate program.

Fintech expansion via Real Wallet

As of October, more than 4,600 agents were using Real Wallet business checking accounts, totaling about $20 million in deposits, Poleg said.

Real Wallet Capital – a new lending product that gives the company’s US brokers access to working capital directly through its digital platform – launched earlier this month.

The program works within Real’s proprietary software platform reZEN and uses agent performance data to determine credit eligibility and loan amounts.

“($20 million) is up from about $14 million at the time of our last earnings call,” he said. “Real Wallet Capital allows us to provide credit based on an agent’s production history and expected earnings, allowing us to provide financing that many banks cannot provide. We believe Real is the only major broker offering agents this type of embedded access to capital, often on the same day.”