In a relatively short time, the power dynamics in residential real estate have shifted dramatically. The National Association of Realtors® (NAR) sits alongside portal giant Zillow on one side, and on the other is New York-based venture capital-backed Compass, a new behemoth that has consolidated a huge brokerage empire and appears ready to use its power to shift how real estate is practiced.
This new dynamic was on full display during Compass’s Q3 earnings call this morning—the first time the company’s leadership has reported to investors since the proposed deal to purchase Anywhere—with CEO Robert Reffkin seeking to position his company as standing for “choice over platform control.”
“(This) is an environment where I don’t think the average real estate professional feels like they are being supported,” Reffkin said.
Reffkin also made a personal “commitment” that Compass would deliver more than $300 million in net cost synergies through the Anywhere deal, with half of that in the first year—though he mostly declined any followup questions regarding the deal, citing pending regulatory approval.
But much of the conversation centered on how Compass is seeking to forge a separate path from the rest of the industry. Calling MLSs “a monopoly” and claiming that agents are “forced” to provide data and listings due to the threat of fines, Reffkin was more explicit in arguing that Compass’s business model and policy positions are in opposition to incumbents, as well as “certain portals,” as he touted his brokerage’s growth in agents and revenue.
“The average real estate professional sees that things are changing and they’re looking for a company that is going to be proactive as the world changes, and not reactive. And a company that has the resources to build the right future for their profession,” Reffkin said.
Asked to respond to Reffkin’s assertions, an NAR spokesperson said “NAR is proud to provide unparalleled value to our members to ensure they are always on the cutting edge of the industry,” and claimed that each MLS sets its own rules. The spokesperson also listed a handful of NAR “advocacy wins” and “technology and research indicatives,” including “protecting members from class action lawsuits” and “defeating rent control proposals.”
Reffkin’s comments are another explicit acknowledgement by the mercurial CEO that his company is on a diverging path from NAR and others—a path which he seemingly stepped onto over a year ago when he announced his opposition to the Clear Cooperation Policy at RISMedia’s CEO & Leadership Exchange event in 2024, and has continued through multiple lawsuits and extensive public lobbying.
Recently, Reffkin also got into a spat with CRMLS, the second-largest MLS in the country, over how it shares and licenses listing data, with CRMLS calling Reffkin’s assertions “defamatory.”
While the crux of the disagreement is still about private listings, with Compass betting heavily on its “3-phase marketing plan” and “Private Exclusives” network, Reffkin also appeared to draw other lines in the send when talking about tech.
Asked if Compass would begin sharing listing data with ChatGPT through a more formal partnership in order to drive more consumer traffic to Compass agents, Reffkin answered that “anything we do will be consistent with what sellers and their listing agents want.”
“It’s not the MLSs data, although they, as a monopoly, they forced agents to give it to them out of fear of $5,000 fines, and then they sell it to well over a hundred different entities,” he said. “I think there will be opportunities like the one you’re mentioning, but it just has to come from the listing agent and their seller.”
Reffkin also claimed that Compass agents were being recommended organically by ChatGPT based on “verifiable real-world data.” He contrasted that with “certain portals” who have “taken the goodwill of Google” to steer consumers toward agents who pay for higher search engine rankings or results.
“ChatGPT is bringing the lead flow back to the truth,” he claimed.
By the numbers
Maybe just as important were the questions Reffkin declined to address. Asked about the company’s 3-phase marketing plan, Reffkin told investors “we’re not diving into that topic.”
Compass’s lawsuit against Zillow, filed over the summer, centers on how Zillow’s restrictions on most private listings affects competition, with Compass claiming that the new rules were targeted at them and could cause “irreparable harm” if a federal judge doesn’t step in to block the rules.
Reffkin also declined to answer a direct question on the company’s “30 for 30” goal of achieving 30% market share in its top 30 markets, saying simply that “we’re not talking about that topic.”
But also very important, Compass appears to have the success to back up its ambitions with “the strongest Q3 results in our history,” reporting a 21.5% increase in transactions to 67,886 and a 23.6% increase in revenue, to $1.85 billion.
Compass’s quarterly market share was 5.63%, an increase of 83 basis points compared to Q3 2024.
The company added 851 gross principal agents, and projected adding 700 to 800 principal agents organically in Q4, with Reffkin saying this should be “the new normal.”
