Foxtons CEO Van Davis has left the discount real estate company for personal reasons, according to an announcement today.
Davis, 46, stepped down from Foxtons on Aug. 1, Foxtons announced. He had joined the company in July 2004 after a four-year stint as CEO and president of Century 21.
“The company, a subsidiary of Foxtons UK, London’s leading property services company, will be led by its executive management team, which will report directly to the UK parent,” the announcement states. Foxtons offers real estate services in Connecticut, New Jersey and New York.
The announcement credits Davis with converting Foxtons to a full-service platform. Foxtons officials provided no other details Monday about Davis’ departure.
The U.S.-based Foxtons discount real estate company was launched by real estate innovator Glenn Cohen in March 2000 as YourHomeDirect. London-based Foxtons injected $20 million into the company as an investment in 2003, and the company’s name changed to YHD Foxtons. In April 2003 the company stripped “YHD” from its name, and London-based Foxtons bought out Cohen in March 2004. After Cohen’s departure, Foxtons founder and CEO Jon Hunt stepped in as temporary chief executive for the U.S. Foxtons operations.
Davis’ move to Foxtons came after a 20-year career at Century 21. He began his real estate career as a Century 21 sales associate, and worked his way up to Century 21 president and CEO by 2000, serving in that role until he left to join Foxtons.
Foxtons has been a pioneer in the U.S. discount real estate business, and made waves in the industry with its low commission rates for real estate services. Some agents and brokers at traditional full-service real estate companies have not embraced the company’s discount business practices. And, in fact, Davis told Inman News in June that the company contacted the New Jersey Attorney General’s Office to describe practices by some agents that Foxtons believes may be discriminatory.
After making a name for itself as a discount company that offered real estate services to sellers for a commission as low as 2 percent, Foxtons tweaked its business model last year to offer fuller services and raised its low-end commission rate to 3 percent. Historically, commission rates for real estate services have hovered around 6 percent of the sale price – with the seller’s agent typically splitting that rate with a buyer’s agent – though the average commission rate has dropped to about 5 percent in some markets over the past few years.
Under the new business plan, Foxtons agents working with sellers who choose a 3 percent total commission rate receive 2 percent of the commission while the remaining 1 percent goes to an agent on the buyer’s side.
Davis told Inman News last year that the company made the change to address the demands of buyers and sellers. “American consumers really want a full-service real estate experience. The thing they don’t want is to spend a full commission. Our belief is that the American real estate market is one that is ripe for change,” he told Inman News in September 2004.
Foxtons agents are employees and receive health benefits. At most real estate companies, agents are independent contractors and pay for their own health coverage. Also, Foxtons agents work either exclusively with home buyers or exclusively with home sellers.
There are employees who handle Internet and telephone leads, a team who follows the transaction process from contract to closing, and a team who are in charge of multimedia displays for property listings, including virtual tours and photographs.
Davis, speaking at a real estate conference in San Francisco in July, said Foxtons employees receive performance-based bonuses, and the average agent at the company will earn about $100,000 this year. Listing agents typically get about 19.5 listings per month, while the company’s buyer’s agents get about 4.5 deals per month, he said.
Foxtons “is experiencing a record-breaking year, having set company listing and closing records in the last two months,” the company stated in the announcement today.
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