Agent Productivity Propels Keller Williams Sales Growth

Agent Productivity Propels Keller Williams Sales Growth

While the company increases in agent count, transactions and sales volume have caught up
caroline@inman.comJul 25, 2016
AddThis Sharing Buttons

A real estate franchise’s total number of agents is only as good as the production they can deliver — the number of transactions they close and the sales volume they bring in.

In the battle of quantity versus quality, do more agents equate to more money? That’s a great question for Keller Williams, a company that reports as being the largest franchisor by agent count.

The company’s second quarter earnings results, which showed its increase in agents was accompanied by even larger growth in total transaction numbers and sales volume — would indicate the answer can be “yes.”


Keller Williams agent count, transactions and sales volume

In Q2 2016, the franchisor had a net gain of 6,073 agents — up 9.2 percent year-over-year. These agents closed 277,594 transactions, an increase of 16.1 percent from the second quarter of 2015. Moreover, the company’s $78.4 billion in sales volume represented a 19.6 percent increase from a year prior.

These numbers are “all-time production records,” for the company, according to KW.


While earnings, deals closed and agent count have all been trending toward growth, these metrics haven’t always been proportionate at KW. Last quarter, KW president John Davis said that the company’s “increasing number of new agents certainly have lower production than experienced agents.”

In Q1, the franchisor had a 36 percent year-over-year increase in agents (a gain of 4,989 individuals), while transactions and sales volume failed to catch up with that growth, at 19 percent and 24 percent growth, respectively. KW noted that in March 2016, the company added more agents than it ever had in its history.

Does the second quarter picture indicate some semblance of equilibrium?

“Our agents and local leadership teams are nailing it,” Davis said in an emailed statement. “They’re boosting production, taking territory and delivering great value to hundreds of thousands of buyers and sellers. Our people are creating opportunities, growing their careers and funding big lives.”

In addition to the guidance provided by experienced agents and local leadership teams, Davis says KW revised its signature course for new agents, Ignite: “We’re big believers in tracking our training and the results have been staggering. Our new agents are stepping up their activities and it’s showing up in the results.”

The revised course has resulted in new agents closing 91 percent more units and a 79 percent boost in their Career Growth Initiative (CGI). “It’s boosting the company’s bottom line. More important, it’s boosting our agents’ bottom line,” Davis said in an emailed statement.

Lastly, Davis says KW will continue to double down on its CGI and apply the “proven conversations, strategies and tools” from the company’s five-year growth initiative.

“It’s the next chapter in our evolution,” he added.

Comparison of agent productivity among franchises

Using the industry’s widely used and cited REAL Trends 500 survey, Re/Max — another big franchise that reports having over 100,000 agents in 100 countries— analyzes the average number of transactions per agent among the various real estate franchises every year.

Re/Max’s analysis of the 2016 REAL Trends survey showed that KW agents average a total 6.8 transactions per year, up slightly from the 6.7 reported in 2015. According to the numbers reported by Re/Max, Sotheby’s International (with 6.3 transactions per agent annually) is the only franchise with lower average agent productivity than KW.

In comparison, Re/Max led the way in annual transactions per agent with an average of 17.3, followed by Realty Executives (10.4), ERA (9.4) and Berkshire Hathaway HomeServices (8.7). The average number of transactions per among all franchises in 2016 was 7.9.

Rise in KW global associates

The second quarter of 2016 also brought an increase in global associates, as the franchisor is now home to more than 146,000 agents, office leadership, staff and coaches who make up the associate count.


These associates receive a piece of the profit pie distributed by the Keller Williams’ brokerages, a perk that’s unique to the company. The amount that associates receive is based on the number of agents that the associate has recruited and how productive those agents are.

In the second quarter, franchisee owner profit (the amount earned by brokerage owners) increased by 13.4 percent from the first half of 2015 to $61.8 million.

Profit share (that which is distributed to associates) rose 17.7 percent over the first half of 2015 to $53.9 million. This is indicative of decreased profit growth from quarter one, when both owner profit and profit share increased by 30 percent year-over-year.

“With new inventory coming online and continued strong demand, our agents are well positioned to achieve record sales in Q3,” said Chris Heller, CEO, Keller Williams in an emailed statement. “And with all the new agent production tools and innovation we’re introducing, we truly believe we’re just getting started.”

Looking forward, Davis says Keller Williams will continue to focus on its agents and providing them with the tools to succeed.

“We’re an agent-centric company so it all comes back to helping our people,” he says. “We’re committed to giving our agents the tools they need to boost their production so they can fund big lives and create opportunities.”

Furthermore, Davis expects KW to continue the momentum it’s built up by extending the Q2 winning formula.

“I have a theory that real estate seasonality is actually a myth,” Davis said.

“By keeping up the activities we know lead to results, we’re focused on building momentum through Q3 so we can minimize the ‘traditional’ real estate decline in Q4.”

Marian McPherson contributed reporting to this story. 

Email Caroline Feeney.

Like me on Facebook! | Follow me on Twitter!

Rates declining but California still among national foreclosure leaders

Report: Rates declining but California still among national foreclosure leaders

According to a new report issued today by real estate information tracking firm CoreLogic, in February 2016, foreclosure inventory declined by 23.9 percent and completed foreclosures declined by 10 percent compared with February 2015.

The number of completed foreclosures nationwide decreased year over year from 38,000 in February 2015 to 34,000 in February 2016. The number of completed foreclosures in February 2016 was down 71.3 percent from the peak of 117,776 in September 2010.

The foreclosure inventory represents the number of homes at some stage of the foreclosure process and completed foreclosures reflect the total number of homes lost to foreclosure.

Since the financial crisis began in September 2008, there have been approximately 6.2 million completed foreclosures across the country, and since homeownership rates peaked in the second quarter of 2004, there have been approximately 8.2 million homes lost to foreclosure.

As of February 2016, the national foreclosure inventory included approximately 434,000, or 1.1 percent, of all homes with a mortgage compared with 571,000 homes, or 1.5 percent, in February 2015.

The February 2016 foreclosure inventory rate is the lowest for any month since November 2007.

California was among the top five states with the highest number of completed foreclosures for the 12 months ending in February 2016. At 72,000, Florida recorded the most foreclosures over the past 12 months followed by Michigan (49,000), Texas (29,000), California (25,000) and Ohio (23,000). These five states accounted for almost half of all completed foreclosures nationally during the past year, according to CoreLogic.

CoreLogic also reports that the number of mortgages in serious delinquency (defined as 90 days or more past due including loans in foreclosure or REO) declined by 19.9 percent from February 2015 to February 2016, with 1.3 million mortgages, or 3.2 percent, in this category. The February 2016 serious delinquency rate is the lowest in eight years, since November 2007.

"Job creation averaged 207,000 during the first two months of 2016, and incomes grew over the past year," said Dr. Frank Nothaft, chief economist for CoreLogic. "More income and improved household finances have helped bring serious delinquency rates down in nearly every state. However, serious delinquency rates increased in North Dakota and West Virginia, two states affected by price declines for the energy fuel each produces."

"Home price gains have clearly been a driving force in building positive equity for homeowners," said Anand Nallathambi, president and CEO of CoreLogic. "Longer term, we anticipate a better balance of supply with demand in many markets which will help sustain healthy and affordable home values into the future."



Rising Mortgage Rates Can be Good for Housing Market

First American Chief Economist’s Existing-Home Sales Capacity Model Decreases 3.1 Percent in October | Business Wire

SANTA ANA, Calif.--(BUSINESS WIRE)--First American Financial Corporation (NYSE: FAF), a leading global provider of title insurance, settlement services and risk solutions for real estate transactions, today released First American’s proprietaryExisting-Home Sales Capacity (EHS-C) model for the month of October 2015, which provides a gauge on whether existing-home sales are under capacity or over capacity based on current market fundamentals. The EHS-C rate decreased by 3.1 percent compared to September and decreased by 7.3 percent compared to a year ago. The seasonally adjusted, annualized rate (SAAR) of existing-home sales capacity is up 73.6 percent from the low point of sales reached in February 2009*. The EHS-C decreased by 181,500 sales (SAAR) in October.

“Rising mortgage interest rates and moderation in house price appreciation were the most important market fundamentals that reduced market capacity this month. Now that interest rates are pre-adjusting in response to signals from the Fed for a highly expected increase in December, demand is also declining.”

Tweet this

EHS-C is down 779,000 sales (SAAR) from the most recent peak in February 2014. The current underperformance gap is an estimated 209,000 (SAAR), which is significantly less than the sales capacity gap of 1.7 million existing-home sales in February 2014.

Chief Economist Analysis: Market Capacity Pre-Adjusting to expected Fed Rate Increase
“The housing market’s capacity for existing-home sales is declining with the expectation of a Fed rate increase pre-adjusting mortgage rates and causing a slowdown in house price appreciation. Market capacity remains modestly in excess of actual sales due to leverage-assisted housing asset inflation, which is home price appreciation fueled by low mortgage rates,” said Mark Fleming, chief economist, First American. “Rising mortgage interest rates and moderation in house price appreciation were the most important market fundamentals that reduced market capacity this month. Now that interest rates are pre-adjusting in response to signals from the Fed for a highly expected increase in December, demand is also declining.”

Fleming added, “This past September, I published an analysis of the impact of a possible rate increase on existing-home sales and house prices titled "Does a Fed Rate Increase Doom Housing?" Based on a 25 basis point increase in the 30-year fixed rate mortgage rate, house price appreciation on a year-over-year basis slows down by 1 percent more than expected without the rate increase. Existing-home sales slow by about 2.5 percent on annualized and seasonally adjusted basis, a decline of less than 150,000 sales a year. The housing market isn’t doomed by a Fed rate increase, but demand would fall modestly.”

Rising Mortgage Rates Can be Good for Housing Market
“An increase in rates on the part of the Fed, causing mortgage rates to rise, can actually be good for the housing market in the long run. Continued low mortgage rates are a contributing factor to the pace of price appreciation that we have seen in the housing market over the past three years,” said Fleming. “Leverage-assisted housing asset inflation is a significant contributing factor to the market capacity for existing-home sales exceeding actual existing-home sales. The longer rates remain low, the longer leverage-assisted housing asset inflation outpaces income growth and reduces affordability for the first-time homebuyer.”

Current Projection for October Existing-Home Sales and 2016 Look Ahead
Actual existing-home sales were estimated to be 5.55 million (SAAR) in September. Early forecasts for October actual existing-home sales predict a significant drop from the 5.55 million (SAAR) reported in September.

“Based on our EHS-C model, I estimate that actual existing-home sales in October will be 5.44 million (SAAR),” said Fleming. “Looking ahead to 2016, I expect existing-home sales to reach 5.5 million by the end of the year. Housing demand is expected to be increasingly dominated by the first-time homebuyer as existing homeowners will have a reduced incentive to sell in a higher rate environment.”

*Previous EHS-C releases referred to November 2011 as the low point of sales. The model used to generate existing-home sales capacity has been enhanced to more accurately reflect the dynamic relationships between sales, prices, interest rates and the user-cost of housing, resulting in a model that more accurately reflects past conditions.

C.A.R. releases its 2016 California Housing Market Forecast

C.A.R. releases its 2016 California Housing Market Forecast -- LOS ANGELES, Oct. 8, 2015 /PRNewswire-USNewswire/ --

LOS ANGELESOct. 8, 2015 /PRNewswire-USNewswire/ -- California's housing market will continue to improve into 2016, but a shortage of homes on the market and a crimp in housing affordability also will persist, according to the CALIFORNIA ASSOCIATION OF REALTORS®' (C.A.R.) "2016 California Housing Market Forecast," released today. 

The C.A.R. forecast sees an increase in existing home sales of 6.3 percent next year to reach 433,000 units, up from the projected 2015 sales figure of 407,500 homes sold.  Sales in 2015 also will be up 6.3 percent from the 383,300 existing, single-family homes sold in 2014.

"Solid job growth and favorable interest rates will drive a strong demand for housing next year," said C.A.R. President Chris Kutzkey.  "However, in regions where inventory is tight, such as the San Francisco Bay Area, sales growth could be limited by stiff market competition and diminishing housing affordability. On the other hand, demand in less expensive areas such as Solano County, the Central Valley, and Riverside/San Bernardino areas will remain strong thanks to solid job growth in warehousing, transportation, logistics, and manufacturing in these areas."

C.A.R.'s forecast projects growth in the U.S. Gross Domestic Product of 2.7 percent in 2016, after a projected gain of 2.4 percent in 2015.  With nonfarm job growth of 2.3 percent in California, the state's unemployment rate should decrease to 5.5 percent in 2016 from 6.3 percent in 2015 and 7.5 percent in 2014.

The average for 30-year, fixed mortgage interest rates will rise only slightly to 4.5 percent but will still remain at historically low levels.

The California median home price is forecast to increase 3.2 percent to $491,300 in 2016, following a projected 6.5 percent increase in 2015 to $476,300.  This is the slowest rate of price appreciation in five years.

"The foundation for California's housing market remains strong, with moderating home prices, signs of credit easing, and the state continuing to lead the nation in economic and job growth," said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. "However, the global economic slowdown, financial market volatility, and the anticipation of higher interest rates are some of the challenges that may have an adverse impact on the market's momentum next year. Additionally, as we see more sales shift to inland regions of the state, the change in mix of sales will keep increases in the statewide median price tempered."











SFH Resales (000s)








% Change








Median Price ($000s)








% Change








Housing Affordability Index








30-Yr FRM








p = projected
f = forecast


Appleton-Young will present an expanded forecast Thursday afternoon during CALIFORNIA REALTOR® EXPO 2015, running Oct. 6-8at the McEnery Convention Center in San Jose, Calif.  The trade show attracts nearly 8,000 attendees and is the largest state real estate trade show in the nation. The remaining highlights of CALIFORNIA REALTOR® EXPO 2015 include:

Thursday, Oct. 8

1:45 p.m. – 3 p.m.
CEO Fireside Chat
C.A.R. CEO Joel Singer sits down with Redfin CEO Glenn Kelman for a very special thought leadership session about the state of today's housing market, what's next for third-party portals, and who will take what role moving forward. Presented by Joel Singer andGlenn Kelman.

Thursday Lunch: "2016 Housing Market Forecast with Leslie Appleton-Young"
C.A.R. Chief Economist Leslie Appleton-Young will share valuable information and insight about next year's California housing market, including projected home sales, median prices, housing affordability, and mortgage rates and availability.

Journalists who would like to attend CALIFORNIA REALTOR® EXPO 2015, please email or call (213) 739-8304.  For more information on CALIFORNIA REALTOR® EXPO 2015, visit

Leading the way ...® in real estate news and information for more than 110 years, the CALIFORNIA ASSOCIATION OF REALTORS®( is one of the largest state trade organizations in the United States, with more than 175,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

eAgentC Websites

How to build your eAgentC Website - 1.1 Edit Domain Info

How to build your eAgentC Website - 1.2 Edit Contact Info

How to build your eAgentC Website - 1 3 Manage Photo Library

How to build your eAgentC Website - 1 4 Create Professional Resume

How to build your eAgentC Website - 1 5 Create Home Page Message & How to add an image

How to build your eAgentC Website - 2 0 Design Your Website

How to build your eAgentC Website - 2 2 Choose Style, Font, Color

How to build your eAgentC Website - 2 3 Customize Page Layout and focus Boxes

How to build your eAgentC Website - 3.1 Customize website Navigation

How to build your eAgentC Website - 3.2 Edit Buyer & Seller Resources

How to build your eAgentC Website - 3.4 Add/Edit Area Links

How to build your eAgentC Website - 3.5 Add/Edit Service Providers

How to build your eAgentC Website - 3 6 Add Edit Client Testimonials

How to build your eAgentC Website - 3 7 Add Edit Pages

How to build your eAgentC Website - 3 8 Add Edit Documents

How to build your eAgentC Website - 3 9 Add Edit Neighborhood Pages

How to build your eAgentC Website - 3 10 eAgentC Blog and RSS Feeds

How to build your eAgentC Website - 4 0 Add Listings IDX Search 4 1 Add IDX Search

How to build your eAgentC Website - 4 2 Add Edit Featured Properties 4 5 Mobile Property Search

How to build your eAgentC Website - 5 2 Manage Your Autoresponders

Take Your eAgentc Website to the Next Level!

Mortgage rates hit high for 2015

Mortgage rates hit high for 2015 - San Jose Mercury News

The average interest rate for a conventional 30-year mortgage rose to 4.08 percent this week, its high point for the year.



Freddie Mac's weekly survey of lenders started the year at 3.87 percent and sank to 3.59 percent in early February. This week's report, released Thursday, showed the 30-year fixed-rate loan at or above 4 percent for the fourth survey in a row, and up from 4.02 percent last week.




Lenders offered 15-year fixed-rate loans to solid borrowers at an average of 3.24 percent, up from 3.21 percent a week ago, Freddie Mac said. The starting rates for adjustable loans also rose.




The slowly rising rates come as the Federal Reserve, having ended a bond-buying program designed to keep long-term interest rates low, is now pondering when to start raising short-term rates.




That increase would not only directly affect consumer rates tied to the prime rate, such as many home-equity credit lines and adjustable-rate mortgages, but also increase pressure on long-term rates like those on 30-year home loans.


Today’s buyers plan to live in homes an average of 20 years, study says

Today's buyers plan to live in homes an average of 20 years, study says - San Jose Mercury News

In another sign the state's housing market continues to heal, people who lost a home in the Great Recession are looking to buy again and both younger wage earners who are forming households and other buyers say they plan to live in their homes longer than in previous years, according to an annual survey released Monday.



The results of the California Association of Realtors "2015 Survey of California Home Buyers" generally reflect a shift toward buying patterns more common before the market meltdown during the middle of the last decade.




But it also shows that today's buyers plan to be nesters rather than getting into the move-up mindset common in earlier years.




For example, today's buyers plan to live in their homes an average of 20 years, more than three times longer than the six years cited by respondents in the 2013 survey, the association said.




The findings are somewhat surprising because the average length of ownership has been in the single digits for years, said Leslie Appleton-Young, the association's vice president and chief economist.




And this fact may go a long way to solving the mystery of why there has not been a supply response to what real estate agents and others say is strong buyer demand.




"I think that's really an important thing just in general terms of this market's cycle and why we have a lid on listings," Appleton-Young said.