The Real-RE/MAX Deal: What Every Canadian Agent Needs to Know

What does it actually mean for your real estate business when the number one brand in the world gets acquired by a company a fraction of its size? That is not a hypothetical… it just happened. And if you are a Canadian realtor trying to make sense of the noise, figure out where the industry is heading, and understand how these massive structural shifts affect your day-to-day business, this episode is essential listening. 

Johnder Perez and Steve Tabrizi are joined by Taylor Hack, Team Leader of HACK&CO and RE/MAX Hall of Fame based in Edmonton, Alberta, to unpack the Real Brokerage–RE/MAX merger in full. 

From the morning the announcement dropped to the long arc of how legacy brokerages, cloud models, and technology platforms got to this inflection point, Steve, Taylor, and Johnder hold nothing back. 

They cover production numbers, MLS battles, private listing networks, demographic divides between newer and established agents, and what the hybrid model of real estate looks like going forward. 

Just straight talk from three people embedded in this industry every single day about what’s to come next!

Listen For:

3:43 What was the immediate reaction when the Real-RE/MAX acquisition news broke?

13:11 How did RE/MAX's original model reshape the real estate industry  and where did it lose momentum?

25:33 How are demographic shifts and technology redefining which brokerages attract top-producing agents?

30:13 What do the MLS battles and private listing networks mean for consumers and realtors?

44:43 What comes next for RE/MAX, Real Brokerage, and the Canadian real estate industry?

Connect with Guest: Taylor Hack, Founder and Team Lead |HACK&CO | RE/MAX River City
Website | LinkedIn | Facebook |Instagram | The Leads Are Sh*t Podcast 

Real Estate Magazine Article: OPINION: Will the real, Real Remax please stand up?

Connect with Steve Tabrizi, Chief Operating Officer/Owner | RE/MAX Hallmark®

LinkedIn | Instagram | Facebook 

Connect with Johnder Perez, Director of Innovation & Business Development | RE/MAX Hallmark®

Website | LinkedIn | Instagram | Email 

Transcript

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Steve Tabrizi (00:00):

Underdog really took a risky bet, but is a calculated bet because the bet is on the agents and on the brand recognition that nobody can dispute in this economy or a global market. This is a number one brand with the market share, with the consumer's acknowledgement. So your bet is really calculated. The risk is only right now is how to merge these two cultures together.

Johnder Perez (00:33):

All right, everybody. Welcome to this episode of Real Estate Strategies with RE/MAX Hallmark. And today we have a fantastic episode. I'm joined with two fantastic, intelligent, super smart gentlemen, and we're going to have a real conversation pun intended. Steve Tabrizi, Chief Operating Officer of RE/MAX Hallmark. Requires no introduction because you've seen him here on our podcast. You've seen his articles, you've read him, you've seen him on videos. So welcome to Steve. And we've got Taylor Hack. Taylor is an associate with RE/MAX. He leads Hack & Co, a diamond team. He's received all these accolades with RE/MAX, Hall of Fame, lifetime achievement, consistently top performing realtor on RE/MAX. He leads his fantastic team out of Edmonton, Alberta. And you're also a podcast host on the Leads Are What? It's a Glengarry Glen Ross reference.

Taylor Hack (01:28):

So you know what? My friend owns real estate magazine.

Johnder Perez (01:32):

Andrew Foliato.

Taylor Hack (01:33):

Our friend actually, Andrew Foliato. And I used to have this weekly call with Andrew where we would just talk about sales and marketing. And the funny thing was, is when people feel like their sales and marketing don't line up, they call lead quality. And the thing they say always is these leads are shit.

Johnder Perez (01:54):

Glengarry Glen Ross.

Taylor Hack (01:54):

And the truth is, is that if you're calling in the wrong stuff or you're reacting in the wrong way to the things that you're calling in, that's your perception because lead quality is all based on quality or response.

Johnder Perez (02:10):

Yeah. And this is one of the many things that we're going to be talking about because Taylor also talks about technology, about the real estate industry, talking about artificial intelligence. We're not going to be talking about AI today, but maybe a part of it is going to be about that. But we're going to be talking about the recent trends that are happening in our real estate industry, particularly when it comes to consolidations that have taken place. The discussions about the private listing networks and the battles between brokerages and MLSs, there's going to be a lot of different things, but the underlying thing is, again, we can't really hide it. It's the RE/MAX and Real. It's called an acquisition. Some are saying that it's a merger. We're going to find out what it really is. And we're going to go through this fantastic conversation with Steve and Taylor today.

(02:55):

You know what? We did a little bit of a pre-show setup and what we're going to do here is we're going to have this conversation to sort of discover what led up to today and what we're talking about today with the industry, with these two fantastic brands and what the real estate mindset is and should be with regards to how this should treat us. But no holds, bar, like you guys don't hold back on anything. We were joking around of, we hope we don't kill the deal or anything. And if it happens, well, you know where to find us, right? But let's start out in the beginning. So Taylor, when we were starting our conversation, and Steve, of course, you can talk to this as well. You suggested that one of the ways that we could start this conversation is finding this out. Let's start with the day this announcement was made, and then let's work retroactively to the beginning of the journey.

(03:43):

So both of you gentlemen, what was your initial reaction when you woke up and it was 7:00 AM Eastern Time, Steve was messaging me, a whole bunch of other people were messaging me. I'm sure you were also messaging each other. So the news broke out. What were your initial reactions?

Steve Tabrizi (03:59):

So first of all, thank you again being on the show. I'll start. I was actually, it was very interesting. The week prior to the announcement, I was celebrating my 60th birthday in Spain. I came back on Sunday night, time difference, jet lag. I decided to go to the office at 6:00 AM. I'm at my desk where I am right now. And at 7:00 AM, my business partner, Ken called me from Florida. He said, "Did you hear it? " I said, "What? It's 7:00 AM. What did I hear?" Because we talk probably 10 times during the day on a daily basis. Then he broke the news to me because we were one of the first franchisees got a personal call from the head office that be aware that the announcement's going out. My first reaction was I was ready to hear about this news for the last two years, but my first reaction regarding the real brokerage, I have to admit, it was an underdog.

(05:08):

And basically I said, "Wow." I was suspecting among the leadership team, we had bet with Zillow going to be the takeover, homes.com going to be takeover, I will call it a large platform going to take over. It took me about probably 45 minutes, an hour, probably I would say easily till 9:00 AM, to really realize, okay, why? And we can talk about those whys as we go forward. I don't know about Taylor's reactions.

Johnder Perez (05:43):

Taylor, what was your reaction when you found out?

Taylor Hack (05:45):

Well, the cool thing is, is that sometimes the world just comes to you just like with Steve. Ken's right in touch with him. This stuff gets delivered. And that was the same thing for me. It was Andrew actually. And he was like, "Hey, did you see?" And I was like, "Ah." So taking a look at it, the first thing was that double take moment to be like, "Okay, not a usual suspect." And then the other thing was to kind of like ... I guess my first reaction was, I don't know that I've ever heard of that happening. Imagine that you heard that it was a very small animal that kind of ate a very large animal, right? There's that joke about how to eat an elephant, one spoonful at a time.

Johnder Perez (06:35):

Yeah. Yeah.

Taylor Hack (06:37):

Yeah. And so that was the other thing. This company has 40,000 agents and they are acquiring a company that has 140,000 agents. And so that was the beginning of my processing. And then you start to take a look at it and you see the numbers, 880 million and you're like, "Oh, okay. What are you paying for? What do you believe you get when it comes down to that? " Because there's a lot of people that are wondering and there's people that wonder about all kinds of companies. If you were evaluating Tesla as a car company, the stock is going to look weird to you. If you are evaluating companies like Follow Up Boss based on revenue when they were bought by Zillow, that would have been mystifying.

(07:31):

However, when you start to take a look at aggregate data, which is what we're getting more capable of producing and contextualizing, like the neatest thing about the way that artificial intelligence works is that it can really put the database together in interesting ways, and that's going to continue to go forward. We really need super computers for that to happen. But now, imagine that you are not just getting RE/MAX, but you're also getting metadata that will help you understand how the highest producing agents in the marketplace continue to do well, even in a situation where maybe their brand has lost momentum.

Johnder Perez (08:27):

Well, so this is a very good point and I'm going to touch on the brand has lost momentum discussion as well, because that's a very important line as well. And this is not the first time this has happened, obviously, the recent Compass Plus Anywhere. So we're seeing small, what we call them, Steve's word was underdog, right? And I think to contextualize what that means is these companies have not been around for a while. Their growths have been accelerated, but clearly, for example, a company such as Real, they were backed by intelligent financiers who saw the value of this proposal and the reason why it would work. So I mean, some might think it's a gamble. I'm sure you gentlemen would agree it's a calculated risk, but let's talk to this trend of consolidation in our industry because this is not definitely ... I mean, this is the first couple of them that has happened.

(09:20):

It's not definitely going to be the last. I think we should have prefaced this by saying this is not to be taken as financial advice. The usual disclosures that have to be claimed on here because these are two public companies. So whatever we say, you can't make it, you can't blame us for the decision to buy or hold these stocks or sell these stocks or whatever. Okay. I just have to get that out of the way. But let's go back to consolidation in our industry. Both of you gentlemen, like Steve and I, whenever we talk about this, talking about the different platform plays, everybody's sort of striving to get the most eyeballs and the most users on their platform, Compass Anywhere sort of became that thing. Real, RE/MAX is that there's going to be future ones. So let's go back to the journey. Taylor, this is what you said in the beginning, the journey of where all of this would have started.

(10:09):

You have a brand such as RE/MAX. So there was an article today in Inman that took it to a bit of a different spin in terms of, oh, RE/MAX was, in your words, a brand that was a bit going through challenging times, even though it was the market leader in its day. So they're kind of framing it as these legacy brands have sort of lost their footing. Let's go back to the journey of these legacy brands, how they built up, what has changed, and then how has technology and how have these technology driven platforms, starting with Zillow, then came Compass. And there's a whole bunch of them, right Finn? We can go on all day. So Steve, why don't you start commenting on that first in terms of legacy to tech to where we're at today?

Taylor Hack (10:53):

Steve, can I take you into one place here related to that?

Steve Tabrizi (10:57):

Yeah, go. Go

Taylor Hack (10:59):

For it. So like when we take a look at, if we were reflecting some of the changes in the industry now and we wanted to draw people back to one of these singularities where it changed, it would have been the point where these brokerages used to be what people would look at as a team. It was one broker that was able to manage advertising and all these other aspects of a business, working with a sales team on splits. That was like the beginning of cooperation real estate. And then rockstar agents started to have these real conflicts with their brokerages about where value is being created. And that's when RE/MAX literally picked up the ball and ran. And the way they did it was to model against those brokerages that were based on splits holistically by setting a rent that was so well researched. And the statement was, "If you are not successful at real estate, you cannot afford to work with RE/MAX."

Steve Tabrizi (12:10):

Correct.

Taylor Hack (12:11):

"And if you are successful in real estate, you cannot afford to work anywhere else."

(12:19):

And that was the beginning, but then there was all this structure put on. Well, not structure put on, I guess I should say that there was a need for structure because it was more than just in your neighborhood. It was in your city, it was in your province, your state, it was everywhere and suddenly the network, meaning relocation and all these other things, this is what required leadership and you are part of the leadership group of the largest brokerage in the global network for RE/MAX. Arguably, they're one of their most valuable assets and statements to this brand. That secret sauce worked for so long.

Steve Tabrizi (13:11):

Yeah, but let's take a look at this. I think it's a good segue. I think I go back to the Johnder question and also the answer that you provided, Taylor, for the first question is, I mean, I've been doing this now for 29 years and it's really what you describe. It's that evolution happened. I remember 29 years ago when I came to the business, MLS book, RE/MAX was really this unorthodox model of the ... Started in US as 100% commission, fixed fee of the cap program, 1,200 bucks a month, 1,300 bucks a month. Royal LePage in Canada, I mentioned the name because we are having a candid conversation. Everybody was scratching their head. They said, "Hold on a second. 60, 40 is split, 70, 30 is split now, 100%. Who is this guy coming from Denver that can think they can change the model?" But let's go forward a little bit.

(14:10):

MLS system came into the fruition properly through, I remember the MLS Dos portal. The book, they disappeared. Fast forward, in early 90s, we as a practitioner, we start complaining. We gave up our number one asset, which was listing the data to MLS, and we all complained about it. We all complained about it through the decade of the 90s and early 2000. In early 2000, everybody was convinced that the MLS system is beneficial for the industry. Fast forward to just before the COVID. COVID was a trigger point for the industry. You want to call RE/MAX, Century 21, Coldwell Bankers, Sotheby's Legacy, traditional, whatever we want to label them, because everybody likes to label them in a way to their advantage of their argument. I refer to them, not a legacy. I don't refer to them as a traditional. I simply refer to them as a model.

(15:18):

There was a model with attachment of the brand. So COVID, prior to COVID, EXP Real, Keller Williams is probably 20 years. I would give it a run. Keller Williams was the first one created a different model than the RE/MAX, came up with the rev share program. But Keller Williams didn't go completely cloud, went a hybrid model, a hybrid model that basically said, "Yeah, we need the brick and mortar. Yes, we need the culture. Yes, we need the sense of community, but guess what agent? We have this model to also to give you the benefit." Back to the Taylor comment, the agents or their top producer says, "Okay, now I'll see a benefit in this community for me. " So beside, yes, the brand awareness, beside whatever the support every brand was given, COVID turned it, COVID turned it in a sense for the first three years of the COVID, everybody got this picture, "Oh, we don't need a brick and mortar." And you got the brand of the cloud-based.

(16:22):

They had a massive growth, massive growth during those three years. But one problem, those brand, they all created for it. And then we end up having basically, during that era of the 2019 to 2020, I would say four. We had two models headbutting constantly, and it was all over the social media, so visible. RE/MAX is dying, brand Century 21 is this, Royal LaPage is this, our cloud is going to take over, agents are going to be disappearing since 2024. AI, artificial intelligence, you name it, everything came to the equation. But both parties, one side of the river, the old guard, one side of the river, the new guard that just said, "I'll take it to the next level." The new kids on the block, they miss one thing. They miss attracting quality agent. Yes, they had a good run. They attracted a percentage of the quality agent, but if ... Look, John, there you know me.

(17:31):

I all firmly believe numbers, they don't lie. Me and Taylor, we can sit here and argue philosophically based on logic, based on everything, but numbers tell the truth. Average agent, Toronto Real Estate Board is the largest board in Canada, probably the largest organized board in the world. The average cloud-based agent is producing anywhere between three to five transaction. Average RE/MAX agent in a downturn market, which was 2025, one of the toughest market, lagging market, did about nine transaction. Across North America, two and a half time to three and a half times. So these two brand, finally, finally around end of mid 2025, these two model, they came to sort of a close to each other. They basically realized I can't attract all the quality agents. And RE/MAX brand also for years tried to create a second momentum for themselves, re-revolutionize themselves, come out of the gate faster.

(18:42):

And technology was a topic of the mind of all the younger generation, younger agents, make your job easy, make your process easy, make sure your connectivity with the consumers easy, but they failed. Let's be honest, they failed. Not only RE/MAX, Royal LePage failed, RE/MAX failed, even EXP failed. And there was a trend in 2024 and 2025. Let's outsource. BoldTrail, Inside Real Estate, kvCORE, you name it, all of that because they said, "Okay, we are not in technology business." But now what happened in 2025? Look at the stock market performance. I am writing an article. I will share it with Andrew. Hopefully he will publish it. I firmly believe these companies, they never should have been a public entity, never. There is no spike in a real estate brand stock ever because it's heavily directly connected to cycle of the economy and agent count and agent productions.

(19:43):

So if the market goes up and the agent production goes up, their contribution to the brand is higher, the stock of RE/MAX from $10 become $10.50. It's not RE/MAX going to come out of the gate or any of these merger come out of the gate. They come with the evolution of the product that they can mass sell to 200, 300 million people. It's not an iPhone. It's not a Samsung that somebody overnight, they use a product or a platform and they can scale the SaaS. This is a operational business. So these two brand, they came to a marriage, a piece now together. I need you. I need you. I need you the top agent. And in Inman, in February of this year when I attended, I said RE/MAX is undervalued, which I was right. On a Friday before the announcement, the stock closed around $7 and change.

(20:40):

Real brokerage, you want to call it acquire, merger, whatever it is, it pays double the value, to my opinion, still undervalued because you got a network that does three to three and a half times more productions. And if Real has a great technology platform, I am not there. I don't have no opinion about it yet, but from what I hear, it seems that they have an ecosystem that works, makes the life of the agent better and make the operation of the OS of the franchisees a lot smoother and easier. So it's a perfect marriage. And sorry. And what I also, after couple of hours of that morning coming to realization, I said, "Yeah, under Dog really took a risky bet, but is a calculated bet because the bet is on the agents and on the brand recognition that nobody can dispute in this economy or a global market." This is a number one brand with the market share, with the consumer's acknowledgement.

(21:52):

So your bet is really calculated. The risk is only right now is how to merge these two cultures together.

Johnder Perez (22:00):

Right. Can I interject here before Taylor gets in? Because what I'm going to say might lead to something that you might want to comment on, Taylor, as well, because Steve has brought in a lot of great points actually. So the brands and what they reflect today, technology companies of today, the fact that a startup company can take over a company that's been around for a very long time, this is something that maybe both of you can comment on in terms of demographical shifts, right? So for example, many top producers are affiliated with, again, I hate using the word legacy brands because I mean, legacy implies sort of that they're both, yeah, they're both great, but they're also old, right? But

Taylor Hack (22:39):

We need to wear that title because we earned it.

Johnder Perez (22:42):

No, that's what I'm trying to say. So when you look at the demographics, when you look at like within RE/MAX Hallmark, within different brokerages, so when you look at the RE/MAX, Century 21 World of Pages of the world, it would be fair to say that the demographics are obviously leading towards a certain age demographic, right? And then when you look at the newer brokerages that have been formed recently, yes, you're not getting the same level of ... Let's say, I mean, it's not bad production either, but you're not getting that same high volume producer with realtors that have been around since, let's say, 70s, 80s, 90s, and have built a massive successful business. So that's one thing that I'd love for you both to touch upon is how this demographical age, preferences in the market and perceptions. So somebody starting in real estate today, they'll be like, "RE/MAX what?

(23:28):

What does that mean?" Versus they look at real. I think it was Gary Vee that put it out there as a term, the TikTokification of things, right? So when you're looking at a realtor today, you're looking at, "Oh, this person's dancing around on TikTok. They bought X amount of followers. They must be successful." But when you look at their production, you know what? It's not quite there. Somebody who's not in our office, Steve, you know who I'm talking about, he's Diamond Club producer, but you won't even find them on social media. So there's the demographic aspect of it that I'd love for you to both comment on. But at the same time too, I want you to tie in this demographical shift to the importance of technology in terms of how that's amplifying some of these platforms. RE/MAX is great as a platform, yes, because it built up literally the technology of its day, which is the top producer.

(24:19):

These days, technology is about the cloud. It's about leveraging AI. It's about unifying everybody on one system. And one thing that Steve pointed out, which Taylor, I'd love for you to dissect as well, when we're having discussions, and again, this is not official, this is not from real or RE/MAX, but when you're looking, this is sort of because I'm a tech geek and I dive deep into these things, there's a difference between these tech companies, quote unquote tech companies that have truly built out their own native platforms where everything is actually owned and proprietary to the company versus the quote unquote companies who call themselves tech, but their tech is A, B, C like Skyslope, Lone Wolf, like a whole bunch of different things put together and you call it tech, right? So Taylor, maybe you should start on this one. The demographical shifts and trends that have resulted in, let's say for example, you have one end, the legacy brands, the other end, you've got these new tech startups and how they're practically equalized.

(25:12):

I know, Steve, I know you love using the word underdog, but you know what I mean? There's just as much power in these quote unquote underdogs and as the legacy brands, because otherwise this acquisition/merger wouldn't have happened and I'd love for us to talk about that. But Taylor, your takes on demographics, tech, and how that's playing into the way we see and value these companies.

Taylor Hack (25:33):

Okay. There was a lot of points there. Steve, you put so much to decode. I like how you have processed this. Also, Johnder, I think your question there had about 30 sub points.

Johnder Perez (25:50):

Yeah, sorry for that.

Taylor Hack (25:52):

I am going to try to hit all of them.

Steve Tabrizi (25:56):

Good.

Taylor Hack (25:57):

The truth is, is that the new agent has more obstacles to choose in order to choose RE/MAX than ever before. The resistance is the future talent and at some point RE/MAX looked at it and said, "Well, they'll earn their way here. We don't want to take chances on these new agents." But man, everybody remembers the bank that didn't take a chance on them when they needed a credit card or a car loan. RE/MAX left itself in this position where technology started to create value that it didn't understand. It missed on this, even though they made attempts. Dave Liniger was the first billionaire that I met. And when you get into the top end, you get to meet people like Dave, and it was really fantastic to understand because this man once rode a buffalo into a convention. He took over. We went one time to the JW Marriott in San Antonio, and they explained how there was three decades that we weren't allowed there because of one weekend we spent there.

(27:26):

And this was the takeover of real estate. This was this big movement. And I think that that's kind of the ballsy side of this deal, is this smaller startup made an upstart

(27:43):

And saw value in a brand that no one else could get. This cloud model is a byproduct of regulation. Before, it was up to brokerages to keep the rules. It was up to brokerages to maintain. And we have empowered the regulatory bodies to the point where even our industry says, "Do you really need to pay for that? You're already paying for that. " So I see this in places like Jasper National Park. They put these deer bridges on because the deer used to run over the road and then they would cause all these car accidents and they didn't want to hurt the deer and they didn't want the drivers to be at risk. So they made these big earth bridges that turn into tunnels you drive through, but the only way that you could make these effective, you can't train deer to go over it, is you put these fences like a big funnel deep into the woods.

(28:41):

That is an example of the regulation that's taken place in real estate, is that they put these giant fences in and said, "This way is the way that everybody has to go. " Except regulation and governments really don't take into consideration that they change the game. And that would have been a fantastic idea if you didn't take into consideration that Jasper National Park has some of the largest wolves on the planet and they're so smart and they got to use those fences to create funnels so quickly and so well that they started to have several meals a day, which is really uncommon for apex predators. So these things, that's what happened, is we deferred the rules to the governing bodies and then they said, "Well, why can't we have one broker for a thousand agents? Why can't we have one centralized processing and rise to the occasion of trying to be able to do compliance?" But they also ended up leaning on all of these brick and mortar brokerages because they didn't have any boots on the ground to where violations were happening left, right, and center.This is going to feed the regulators like nothing else if this continues.

Johnder Perez (30:11):

Jesse, do you want to comment on that?

Steve Tabrizi (30:13):

Well, talking about the regulator and the regulator of the industry, when Compass took over anywhere, acquired merger, what do you want to call it? And then the fight of the ... If you go back to the NAR lawsuit, the whole premises around the NAR was consumers choices. Everybody lost, fast forward, Compass takeover anywhere. I want to touch in the regulator issue here. And it goes back to my comment of the data that we gave over asset. Real estate industry without the listing, RE/MAX was built on the premises of “list to last, list to last.” Once the listing comes, that's the data. Open house comes, buyer inquiries comes, net traffic comes. Everything is start from there. So Compass comes and it says, hold on a second, why should we follow these rules of the Zillow that any listing that we get immediately got to go to the MLS because the bloodline lifeline of Zillow is a IDX and DDF feed through the MLS.

(31:30):

Now, we are protesting this. We want to have a week or 10 days or two weeks to our own agent. What's happening in our industry that people don't want to pay attention. It's not about, oh, RE/MAX is dying or the cloud-based are better than RE/MAX or vice versa, legacy versus cloud. Both groups need each other. They need each other for one thing. How can we increase the profitability? They're a public company, but the profitability only comes through productive agent. And then how can we monetize that data behind a transaction? That's why the argument now in US is, okay, we're going to have a MLS, we're going to have a Zillow, maybe we'll have a homes.com, maybe we'll have also a compass.com. A listing comes maybe from a Compass now for the first week is going to be only Compass and the consumers storm to get that access to that.

(32:29):

And then after a week goes to Zillow. 10 years from now, I guarantee you, if the regulator and MLS industry, they don't up their game and have a value proposition for the agent that they're paying the dues, agents, they will end up having the best choices for their client. Where the best traffic comes, where the best information comes, where the best exposure comes for my clients, it won't be automatically, "Oh, let's go to MLS." MLS was in 80s and 90s, the big deal, is no longer the big deal.

Johnder Perez (33:11):

So here's a question to stem off of that because we talked about the private listing networks and you're seeing all these battles between brokerages and MLS. Well, the big one that's going on right now. So Steve, you sort of alluded to the fact that when you have a big audience, which you do, and this is sort of another level to display, and again, we're speculating here, so there's nothing to take official. When you've got the most number of top producers in your network, when you've got the most number of listings because you're listening to last, you also have the most influence in terms of how to market that. And so you're seeing, you've heard of the cooperation policy. We are all members of the Canadian Real Estate Association. So in terms of personal comments on that, I don't think we can go in terms of beyond that, but in terms of opinion, when you look at the consumer choice, and this is for both of you, when you're seeing these large networks band together, when you're seeing battles against the MLSs saying, "Hey, you know what?

(34:08):

This isn't fair because the consumer's the one who should get a choice in terms of how to expose their listing, not the MLS board rules." And then when you're seeing combinations of private brokerages banding together with MLSs, and then MLS channels banding with other MLS channels like Realtor Zillow, you're seeing that recently. Let's address this from two options, from two perspectives. One is from the perspective of the consumer and how they should benefit in terms of choice in seeing what houses are available. I mean, and we can all agree on this, that the MLS, while it did good, there's also some bad that came out of it, right? I mean, the good of it is that the original intention of sharing data, the cooperation between realtors and the exposure of your listing in a massive way versus before. If you held all the listings in town and you're pretty much king, right?

(34:59):

You pretty much had all the control to that in terms of the marketing to it. So Taylor, maybe you can start with this one. The perspective of a consumer, how it benefits them based on these changes in structure in terms of platforms, in terms of expanding sizes of brokerages, MLSs versus the brokerages and the policies. And then from an agent perspective, how does this amalgamation and consolidation affects that aspect of the business, which is, do I list on MLS? Do I give my clients exclusive and how they should direct their clients?

Taylor Hack (35:33):

I think it actually all starts with the consumer. And let's talk about the most common consumer in Canada, which is the average family. So families with kids are the biggest group and we're talking about their house and this is something that is very deep seated because shelter is a base need. So when we talk about how we help people, that deep understanding is where it begins, that this family has a challenge. They have some real restrictions when it comes to their financial ability of buying and selling at the same time. They don't want to move twice, and they need the best options that won't leave any money on the table. Now, we're looking at real estate in the modern realm, but we have to take a look at how it evolved because there's some significant asks here and there's a lot of people that don't understand how real estate agents create value, but really where is the average person getting the ability to negotiate on something as high stakes as their home?

(36:40):

They used to negotiate at future shop, that doesn't happen anymore. They used to negotiate at a car dealership, and I have to say that we've seen the results of that, the car dealership is winning. And so then when it comes down to them negotiating with a stranger, they don't understand how to play the game in most cases, like this would be the similar if it was a swimming competition, not everybody knows how to swim. Some people under those circumstances, if they were forced, if you don't know how to swim, there's a real high chance you're going to drown. And there's some people that felt that way. So in the beginning, people just had a listing agent, and then buyers thought that they were just getting their asses handed to them. And so then cooperating commissions gave both person and both people an expert. But the ask from these average families is a wide ask.

(37:32):

If you were to break down all the things that we do, there's such an uncommon array of skills.

(37:42):

When you take a look at marketing and sales, and then you have to do these efficiencies, like if you are not able to find opportunity when you're helping somebody sell their house, the amount you would have to charge them is even more than it is now. If you wonder what it's like, try to put a plumber on call 12 hours a day, and sometimes the calls are just to talk about your feelings. Okay? Think about how much that would cost for a 90 day period. Sometimes people tell my wife, she's an emergency nurse, it's in the middle of the night and she's putting an IV in, and they'll snarl at her about the wait time in the hospital as though it's her personal responsibility. And then they'll mention that they pay her salary. And she makes eye contact when she says, "Well, I'm not sure how much it would cost to get a plumber to your house at two o'clock in the morning, and right now I'm plumbing you.

Steve Tabrizi (38:43):

" That's a good way of putting it.

Taylor Hack (38:47):

So we have to start this conversation at what are we actually doing for consumers? They're not set up for this. They're trying to deliver 18 summers to their kids. This is something that they would not choose to do, and it's a wide array of skills. We do agree that we made this MLS system so valuable that they fought about it in court. We made a system, and then they said the assets of that system do not belong to you as a group, because we're not allowed to be a group. That's what they were saying with the rules and what they call antitrust in the United States and what they call the competition rules here. And when you take a look at the way RE/MAX responded to that and the way RE/MAX navigated that, it's at the bottom of all our business cards. It says each brokerage is independently owned and operated.

(39:45):

That means that consumers have choice, whether they go with the RE/MAX brokerage that I work out or the RE/MAX brokerage that Steve owns. So when we take a look at how that is in the future, I think that this is something that there might be like, is there going to be enough choice when there's one brokerage that runs us all?

Steve Tabrizi (40:08):

It's a very good point that you raised, but Johnder, let's also take a look at this, what happened. Also, agent's expectation, consumer's expectation. Everybody highly got educated, as Dillard said, consumers, they are making the biggest investment of their lifetime through this process. Then let's take a look at our industry. It's became an industry that actually pivotal point for a Canadian or American economy. It's not anymore, okay, it's a sector. It's not a sector. It's truly an industry. It's not about the real estate transaction. Let's start from there. Construction is behind it. Then it's before ... We are as a practitioner, we are in the during process. There's a before process, which is construction. We are the during process, and there is a massive service industry after it. Somebody buys the car, somebody paints their home, somebody is a plumber, relocation. So in Canada, it represents 25% of the GDP.

(41:17):

So you got an industry, the consumer expectation is high. The agent expectation is high during the last decade, and they're now saying, "Okay, where do I want to be? " Agents say, "I want to be somewhere that I get highly educated, highly supported, and I can be proud of the brand I represent." So when you take a look at all these merger that happened, the last two big one, hopefully with the RE/MAX one too, the consumers basically wants the best service, the best educated, so they can make the right decision. Agent, at the same time right now, I feel Taylor references who won in the auto industry. The auto industry, yeah, by amalgamation, by monopoly of one family bought so many different brand of the car dealership. Yes, that's a negative aspect of it, but if you look at the other benefit of it is you are dealing a full skill service amalgamation.

(42:15):

Somebody like Reel will bring a tools and technology which help the process. The process is not only for agent or for broker owner, how the consumers get service, how the consumers get educated, how consumers get notified, how everything gets communicated through them. And you got also well trained agent, which is the RE/MAX side, or could be real, could be any of the brand, they're going together. One thing else also happened to our industry, like many other industry, look at the airline industry, look at car industry. In the last 30 decades, fragmented many brand, many model, many new startup, and it was chopped all over. It was destined and due for the amalgamation. John, that if you recall 10 years ago and keep talking about it, we said there are three different model of the brokerages, full service brokerages, discount brokerages, large, full service large, and a lot of pretender in the middle.

(43:20):

This pretender in the middle could be all brand, could be RE/MAX, could be able to pay Century 21. They can keep up with the top and the bottom. They either got to go up, they've got to go down, and that's the story of the amalgamation that is happening right now.

Johnder Perez (43:35):

Yeah, which is absolutely amazing. And I think this conversation, in as much as we've spent this much time talking about it, I have a feeling there's going to be a part two of this-

Steve Tabrizi (43:43):

Probably. ...

Johnder Perez (43:43):

Where we're going to explore into more of a deep dive. But this is a question for you both. And thank you, Steve. Thank you, Taylor, for your insights so far. Steve, when this first came out, it was announced as an acquisition. You jumped and said, "You know what? This is no acquisition. This is a merger." Maybe we're going to save that to a part two. But what I want to do to finish off this conversation is ask you both, where do you see things going now? Now this is happening. Hopefully we didn't rock the boat enough and I don't think we did, but for this real RE/MAX merger to combine, what do you see happening next? Not only for these two companies, but for ... I don't want you to speculate on which companies are next, because I mean, Steve, you can just read Steve's article on Real Estate Magazine and you'll find that out.

(44:31):

What's happening next to these two brands, to the real estate industry, and to real estate as a service in general? You both can comment on that.

Taylor Hack (44:43):

I have to say, first off, ballsy move. And what I mean by that is that for the CEO of Real to take a look at this deal and to be able to explain to investors why it's valuable, because obviously the market doesn't understand it if you take a look at the stock, right? But there's investors behind this that actually make the deal look like a startup, right? When you take a look at how it's funded, and then when you take a look at the brand, it's a merger. That brand announcement made a totally different statement. And then when you take a look at the actual announcement they made is an acquisition. So I think that there's some clarity be left here, but what we're actually hoping is that we see that this is just like when Ninja Appliances got Costco distribution. This is a new method because there were parts that were lost and really a lot of it was agent to agent connection when we went to the cloud.

(45:49):

That mentorship and apprenticeship, it's also a huge challenge. They just recruited the unrecruitable en masse. Whoa, you guys got the wild cards — are you the leader that can take us forward? RE/MAX lost momentum through failed CEOs as well as failed tech deals, Redfin, Booj, kvCORE, you name it. We tried it.

Steve Tabrizi (46:19):

We

Taylor Hack (46:19):

Tried it with so much money that this is the results. The debt carried by RE/MAX was part of the reason that a deal like this could take place. So because of that, the future that we're really looking for is for you guys to deliver what's a huge question right now, which is does tech make money?

(46:40):

Will this tech actually energize us or was the most effective way or use of your tech to recruit, or will this actually be something that can change what's already kind of mostly working, but really good acquisition in the case that you guys just bought the largest evidence pool of value created by realtors. In my neighborhood, it's RE/MAX Field in Edmonton. Right in my community in Sherwood Park, it's RE/MAX Spray Park. There is no evidence of real estate agents like RE/MAX as for boots on the ground, so show us how to put one foot on the ground and one foot in the sky. If you can navigate that, you will win.

Johnder Perez (47:29):

Amazing analogy. Steve.

Steve Tabrizi (47:31):

I think they won't say it. They won't admit it. Both parties, they come to a conclusion. We need each other. Both party acknowledge that there is no such thing as a brick and mortar and a cloud is a hybrid. So the definition of the future is hybrid. We need community. We need smaller brick and mortar. We need technology. Taylor said it was a ballsy move by the CEO of Real. I would say very smart move. If you take a look at how Compass started and grew by angel fund through private equity, through a bank in Southeast Asia and basically acquired Agent. They used to call it sign up for agent. Real did that times 100 in one shot, but what's the value of the 140,000 agent that took 50 years to get to this point? That's number one value. Number two, value. What's the value of the global presence?

(48:44):

That's the number two value. Number three value. What's the value of the most recognized brand in a global market? That's the number three value, but the most important value. What's the price tag for the most productive agent? These CEOs, they won't admit it, Johnder, but I will tell you, everybody is talking about the future data monetization. Kudos to Tamir from Real Brokerage. He made a very smart, calculated move. The underdog showed the big players, "I'll take this risk because he's not taking the risk." Taylor just described two neighbourhoods in Edmonton. They're dominating. So who wouldn't buy such a mega force that can literally make that brand of real RE/MAX as a holding company to be a global brand? Period. Simple. Is it a value of just that piece? Is it a quarter billion dollars at a half a billion dollars? Because I recall Compass has spent close to half a billion dollar to just build their initial roster, half a billion dollar to build their initial roster.

Taylor Hack (50:10):

These cloud brokerages came in during a time when the market had more momentum in North America in real estate than we have seen in history, right? And what we do know is that whoever ends up with the most agents in a down market is in trouble. And in this case, I think that maybe also it's a sign of the times and it could be good foresight by the real CEO in knowing that there's nobody that wants a questionable agent in a questionable market. So who's left?

Steve Tabrizi (50:45):

There you go. And John, there, you said prediction who's left? The people who are left, they have two choices. Either they got to step up, they got to come from that denial. RE/MAX was in denial. I love Dave Liniger. Kudos to him. Congratulations for what he did. Phenomenal changed this industry. He's going to be remembered for decade forward through this industry. The man is resilience. What he has done is unbelievable. But also Re/Max could have done this maybe 10 years earlier. And the people who are left in this industry, the other brands, LePage, eXp, Keller Williams, those are the three that are left. Two, one in Canada, two in North America. They got two choices. They either really got to change that dynamic of the model to the hybrid and the one that they are really still stuck with the old way of running it. Sooner or later, something going to change with them.

(51:55):

Either a merger, either a buyout, or if they continue this path, they're going to make the life of their operators, which is franchisee, or agents more difficult and more difficult.

Johnder Perez (52:14):

There you go. I'm sure we can all agree interesting times ahead. Thank you, gentlemen, for this fantastic conversation. We've got a lot more to cover, so this is going to call for a part two at some point. We're constantly reading up. I'm reading up the Securities Exchange Commission, like SEC filings about what real is saying, what RE/MAX is saying. There's a lot more interesting stuff we couldn't cover in this time. Thank you, Steve. Thank you, Taylor. If you're watching this on YouTube, make sure you subscribe, make sure you comment, give us your opinions, what you agree, what you disagree with. If you're listening to this podcast, make sure you follow and rate us. And we will see you in our next episode of Real Estate Strategies with RE/MAX Hallmark. Thank you, Steve. Thank you, Taylor. Thank you for all of you who are watching and listening.

(52:57):

See you next time.