Dave Liniger, the adventurous co-founder of RE/MAX, is always on the move, and he doesn’t expect the real estate industry to sit still, either.


Liniger, who shared his industry insights during an Inman News conference call Thursday, said the industry can be resistant to change but it is not immune to change. He should know. Liniger won over the industry after initially battling to get a foothold for the then-radical concept of 100 percent agent commissions.


“Every industry resists change,” Liniger said. “So no change happens rapidly. I think the industry has to be tolerant and allow the changes that are coming to come. Everybody has to have a chance to make it work.” Citing the example of buyer agency, Liniger said it was “an incredible change in the industry” that gradually gained acceptance until it became a common practice.


Fee-for-service real estate operations likely will become the next major wave of change for the industry, Liniger said, though the shift certainly won’t happen overnight. While home prices in some areas have soared 400 percent to 500 percent in a short time, “the cost of selling homes did not go up that much,” he said. “I think you’ll see that fee for service will become an important factor over the next 10 years. (It) will be a commonly accepted business practice.”


Liniger and his wife, Gail, founded RE/MAX in 1973. It has since ballooned into one of the most dominant brands in the business, with three RE/MAX offices ranking in the top 20 of the Real Trends list for both closed transaction sides and sales volume in 2003. RE/MAX offices represented about 33 percent of the 500 total residential real estate companies on that list.


Not bad for a brand whose name (short for “Real Estate Maximums”) evolved from a session that involved “a bottle of tequila, some salt and some lime,” Liniger recalled. And, of course, a dash of brainstorming.


With the creation of RE/MAX, “I was attempting to do something that hadn’t been done before,” Liniger said. “We were undercapitalized, we had lots of financial problems and recruiting was very tough.” At one point, RE/MAX was under investigation by more than a dozen government agencies, he recalled. “By the fifth year we were number one in the market. The rest is history.”


RE/MAX has not been free of changes. The original 100 percent commission plan for agents has evolved into a 95/5 split system for over half of the RE/MAX network, he said, driven in part by the need to bring in new recruits. Under the 95/5 split, RE/MAX regional offices and local office broker-owners get a share of 5 percent of the commissions taken in by agents, with agents retaining 95 percent.


Though Liniger was a an early proponent of maximized agent commissions, others companies have since adopted similar business plans. “No competitive advantage lasts forever,” he said. This is a big, big industry and there’s going to be room for everybody.” Even so, this robust real estate market that has enjoyed a prolonged boom may finally be coming back down to Earth, Liniger said, and the expected rise in interest rates could curb the real estate market’s strength by 10 percent to 20 percent.


Though he recently parked his hobby as a NASCAR driver and also backed away from a U.S. Senate race, Liniger said he is ready for new adventures. He is a member of The Explorers Club, an international society for explorers and field scientists around the world, and he still carries that boyhood zest for new quests that first carried him from the soybean and cornfields of Indiana to the war zone of Vietnam. A pilot of airplanes and balloons, Liniger in the late 1990s was part of a team that sought to circle the planet in a high-altitude balloon.


Asked about his decision to step out of consideration for a Senate seat, Liniger said the lack of privacy, the time away from home, and the demands of running a company were important factors. “I’ve got a thick skin and I figured I could handle it, but I was really concerned about my family,” he said. “It was really quite a dream. I really got caught up in it,” he said, adding that he envisioned a platform focused on his strengths as a “self-made man” and a “job creator,” but “I was concerned…for my children and for my wife.”


What will the future hold for him? “I’m going to die at my desk, or in a racecar, or in a jet plane or something.” And expect him to continue to be a leader in the real estate industry. “I have an incredible passion for this industry,” he said. “This is a fun, fun job.”


And what about those critics who fought his very entry into the real estate marketplace? “I was in my 20s and they were in their 50s. Now I’m in my 50s and they’re all dead.”

Send tips or feedback to Glenn@inman.com or (510) 658-9252 ext. 137.


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