Companies in this industry act as agents or brokers in the buying and selling of residential real estate, in addition to leasing and managing residential properties. Major companies include Keller Williams, HomeServices of America, Long & Foster, Realogy, and Re/Max (all based in the US), as well as Countrywide Group (UK), Deutsche Wohnen (Germany), FirstService (Canada), and Leopalace21 (Japan).
Demand is driven by population growth and construction activity. The profitability of residential real estate brokerage and management companies depends on demand for properties and the volume of transactions they handle. Demand and volume are usually higher during periods of strong economic growth and can be negatively impacted by a recession or too much new construction. Large companies have only modest economies of scale and benefit mainly from better name recognition than smaller rivals. Small companies compete effectively by developing expertise in a single market or region. The US industry is fragmented: the 50 largest companies account for about 25% of revenue.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major services include sales, leasing, and management of residential property. Many companies provide multiple services; for example, companies that lease residential units to tenants might also manage the properties. Some residential real estate leasing companies operate as real estate investment trusts (REITs), which are covered in a separate industry profile.