Douglas Elliman’s Howard Lorber and Tongo’s Brandon Wright (Getty Photographs, LinkedIn/Brandon Wright)
When residential dealmaking dries up, brokerages have to uncover unconventional means to generate dollars.
Douglas Elliman rolled out a payday personal loan company system to its brokers, giving an alternate supply of earnings as the field braces for a down sector.
Tongo, a 3rd-get together platform backed by New Valley Ventures, Elliman’s expense arm, lets brokers borrow up to 75 per cent of a pending commission for a 3 to 5 % payment charged every single 30 times. Tongo introduced past 7 days that it had completed a $7 million seed spherical.
The move is a way to give brokers liquidity, mentioned a spokesperson for Elliman, who insisted that it was unrelated to the humdrum point out of the residential marketplace.
“The timing comes solely due to the fact we recently found Tongo and are enthusiastic about their answer,” the spokesperson explained.
Even now, a cooling marketplace with less deal stream usually means that brokers may have to wait around for a longer period, for much less checks. Tongo described its service as a “cash on demand” debit card item that could support agents stabilize hard cash flows.
And Elliman isn’t the only brokerage asserting new products and solutions. Keller Williams this month claimed it will supply wealth administration coaching to its brokers, with an eye toward possibly licensing out these kinds of teaching to other corporations. And business agency Walker & Dunlop is getting into the non-public lending business with Walker Personal Lending, concentrated on multifamily house proprietors.
It’s all taking place in opposition to the backdrop of extreme economic uncertainty. Cushman & Wakefield in late August predicted a mild recession pushed by substantial oil selling prices and the ongoing Russian invasion of Ukraine. Ian Shepherdson, main economist at Pantheon Macroeconomics, informed the New York Write-up that house costs could drop by 20 % via the center of future yr.
That could spell difficulties for Elliman, which did not develop its income in line with some of its opponents in the next quarter. Elliman’s revenues rose just below 20 p.c concerning the initial and 2nd quarters of this year, whereas Compass, eXp and Any where all saw rises of at least 30 per cent.
Elliman’s stock is down 62 per cent this 12 months.
