Check out the latest round up of real estate industry news bites
Former Keller Williams Realty CEO and President John Davis Alleges Fraudulent Business Practices
Former Keller Williams Realty CEO and President John Davis came out swinging against his former employer this week. Davis issued a press release with stunning allegations of fraudulent business practices, deceit, and operations similar to a criminal enterprise. Davis is seeking $300 million in damages from defendants Gary Keller, Josh Team, Keller Williams Realty, and Inga Dow.
Davis resigned in 2019 to avoid then-Board Chairman Keller’s constant pressure to lower the franchisee’s revenue model, altering franchise operations outside of their franchise agreements. It will be argued that by pressuring individually owned and operated offices to change their economic model, the Chairman of the Board and later CEO Keller improperly interfered with each individually owned and operated office that did so, possibly breaching franchise law, violating his obligations as Chairman, CEO, and majority owner and putting those offices at financial risk.
eXp Posts 22 Percent Revenue Gain In 2022
What slowdown?! While many real estate companies and brokerages felt the financial pinch of last year’s market slowdown, eXp managed to ride the wave to solid heights.
According to its earnings report, the company saw its revenue increase 22 percent to $4.6 billion in 2022, with revenue of $933 million in the fourth quarter of 2022. Gross profit increased 24 percent to $366.9 million annually with gross profit of $83.1 million in the fourth quarter of 2022. Net income was $15.4 million in 2022 with net loss of $7.2 million in the fourth quarter of 2022.
“Thanks to the hard work of our agents and our industry-leading operating efficiency, our core eXp Realty North American business remained solidly profitable in the fourth quarter despite the market downturn,” said Glenn Sanford, Founder, Chairman and CEO of eXp World Holdings. “In line with how we manage our business, we are now reporting segment-level financial information, which also provides transparency into the financial performance of our core business and the investments we are making to reinforce and extend our position as the most agent-centric brokerage on the planet.”
Mortgage Applications Decrease in Latest MBA Weekly Survey
Mortgage applications decreased 5.7 percent from one week earlier, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending February 24, 2023. On an unadjusted basis, the Index decreased 4 percent compared with the previous week.
The Refinance Index decreased 6 percent from the previous week and was 74 percent lower than the same week one year ago.
“The 30-year fixed rate increased to 6.71 percent last week, the highest rate since November 2022, which drove a 6 percent drop in applications. After a brief revival in application activity in January when mortgage rates dropped to 6.2 percent, there has now been three straight weeks of declines in applications as mortgage rates have jumped 50 basis points over the past month,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Data on inflation, employment, and economic activity have signaled that inflation may not be cooling as quickly as anticipated, which continues to put upward pressure on rates.”