Rocket Cos., the parent company of the nation’s biggest mortgage lender, plans to get into the iBuyer and real estate brokerage business through its Rocket Homes subsidiary.
Rocket Homes, which is already licensed as a real estate broker in all 50 states as the operator of a property search site and agent referral network, will hire on-staff real estate agents and launch an iBuyer program “throughout the remainder of 2021 and into early 2022,” the company announced.
Rocket Homes said that beginning in the fourth quarter of 2021, on-staff agents working from downtown Detroit will provide services to sellers at a discounted commission rate of 1.5 percent. Those remote agents will provide advice on listing price, facilitate photos, place homes in the local multiple listing service, negotiate offers, and handle paperwork.
Sellers who would rather work with an agent in their market will be referred to the Rocket Homes Verified Partner Agent Network, which provides access to agents in 3,000 counties, and has assisted close to one million buyers and sellers to date, the company said. Sellers who don’t want to work with an agent at all can use Rocket Cos.’ ForSaleByOwner.com platform for free.
“Whether a client is looking to sell their house on their own, get assistance from an on-staff Rocket Homes agent or meet face-to-face with our trusted local real estate professionals, we will have unique options and resources to help every client move through the process in a way that is fully customized to them,” said Doug Seabolt, CEO of Rocket Homes, in a statement.
Seabolt told Inman that although Rocket Homes has employed real estate agents for years, they’ve provided services to Rocket Cos. employees, friends and family.
“We are expanding that now [to the general public] because it’s worked so well for us,” Seabolt said.
Rocket Homes said a “soon-to-be-released iBuyer program” will be facilitated through third-party partner companies, giving homeowners who want to buy a new home a guaranteed offer on their current home, and eliminating the need to make a contingency offer.
“We’ve been loking at that iBuyer space for a long time,” Seabolt said, and Rocket Homes is in discussions with potential partners.
With direct connections to Rocket Cos. subsidiaries Rocket Mortgage and Amrock, a provider of closing and settlement services, Rocket Homes said it’s aiming to provide a “comprehensive suite of services.”
Last month Rocket Homes announced that its property search portal’s coverage had expanded to include listings from all 50 states. The company is licensed as real estate broker in all 50 states, and is a member of the MLSs where it displays listings, a spokesperson told Inman.
In its most recent annual report to investors, Rocket Cos. said Rocket Homes’ partner agents were involved in 27,400 transactions in 2020, down from 30,300 in 2019. But gross revenue increased by 6 percent, to $45.6 million. Rockethomes.com averaged 568,500 unique monthly visits last year, up 216 percent from 180,000 visits a month in 2019.
Rocket Cos. also disclosed that the Consumer Financial Protection Bureau had issued a civil investigative demand to Rocket Homes in May, 2020, “to determine if Rocket Homes conducted any activities in a manner that violated RESPA [the Real Estate Settlement Procedures Act] and to determine if further CFPB action is necessary.”
Rocket Cos. said it was “cooperating fully with the CFPB in this investigation and are confident in the compliance processes that Rocket Homes has in place.” RESPA, which governs compensation for business referrals made in connection with a federally-related mortgage, can be difficult to interpret, the company said in its annual report.
“In some cases, it is unclear as to how such laws and regulations affect Rocket Homes based on our business model that is unlike traditional brokerages, and the fact that those laws and regulations were created for traditional real estate brokerages,” the company said.
A CFPB spokesperson told Inman that the bureau had no comment on the status of the Rocket Homes investigation.
The move by Rocket Homes to hire in-house agents echoes plans by a sister company of Better Mortgage — Better HoldCo Inc.’s real estate brokerage subsidiary, Better Real Estate LLC — to employ 500 salaried real estate agents in 20 states by the end of the year. About 90 percent of Better Real Estate’s clients come through Better Mortgage’s pre-approval process, Christian Wallace, Better’s head of real estate services, told Inman.
Last month loanDepot and its agent matching subsidiary, mellohome, announced cash rebates of up to $7,000 on bundled services when clients buy and sell with a mellohome preferred real estate agent, finance with loanDepot, and choose the company’s title insurance services.
Editor’s note: This story was updated with additional comments from Rocket Homes CEO Doug Seabolt.