Ricky Carruth on changing the infrastructure of real estate

Name: Ricky Carruth on changing the infrastructure of real estate
Uploaded: 2026-08-12T08:00:38+00:00
Duration: 27 min 18 s
Channel: HousingWire

00:10Welcome, everyone. My guest today is Rikki Carruth, Chief Housing Analyst for Realty Co.,

00:15top producing real estate agent, and a very successful real estate coach, as well as the

00:20host of the Rikki Carruth Show podcast to talk about some of the new challengers looking to

00:25upend the real estate transaction, or at least get a piece of the pie, and how agents should be

00:30prepared. Rikki, welcome to the podcast. How are you doing, Sarah? I am doing great. Thank you so

00:36much. I know how busy you are, and I follow you on social. Love seeing what you're doing and just

00:43all the industry knowledge you have and how you're doing that for agents. So really appreciate you

00:48being on. No, my pleasure. Where are you at? I am at the Florida Association of Mortgage

00:55Professionals in Orlando. I'm at the Ritz-Carlton. Very nice. Oh, fancy, are we? We are, yeah.

01:02So, but look at you. You have your great studio, so. Yeah, yeah. Yeah, absolutely. No, I was in

01:07Dallas last week. That's where your home base is, right? Yes, it is. Yeah. Yeah, yeah. I was in

01:11Dallas last week speaking to Build, and I've done, I think I've been on, I was trying to add it

01:16up the

01:16other day. I think I've done 16, I've been on 16 stages this year, you know, traveling around,

01:21speaking to agents and conferences and stuff like that. So we're always on the move, aren't we?

01:27Always on the move. And I mean, your social presence is really impressive, too. So I don't

01:32even know how you managed to do all that. You and Logan, you guys are like, you're doing all this

01:36stuff, but then you would think you have a full-time job on social, but no, you're also doing all

01:40this

01:40other stuff. So very impressive. Yeah, it's like social is just like the side gig.

01:43Like, almost feels like a full-time job, so. Yeah, so I'd love to get your take on what some

01:50of those larger infrastructure changes, what that means for the industry. And start wherever

01:55you want there. You can start at the top. Yeah, no, no, no. It's an evolving, it's an evolving

02:01creature, if you will. You know, 40 years ago, around 40 years ago, like, you know, NAR basically

02:07came into the picture, created the MLS structure because there was all this backdoor deals with

02:13listings, agents were hiding listings and stuff. So they created this platform where everything

02:18was transparent. Like, every agent knows what every other agent has out there for sale, all

02:23the consumers know, and they wanted to create this world of transparency. So fast forward to

02:28today, you have basically NAR and Zillow, who have kind of almost, in a way, monopolized

02:35the entire thing. And it's rubbed some feathers the wrong way, basically, with a lot of different

02:43people out there. You know, case in point, the number one guy against it all is Robert

02:48Refkin over at Compass. You know, he started his stuff back, I don't know, it was like 2018-19,

02:53he started doing these private listings over in California. And NAR actually changed the

02:58rule, they created this clear cooperation policy, which basically said that when you get a listing

03:04as an agent, it's mandatory that you put in MLS for everyone to see within 24 hours, or that

03:10you can't publicly advertise it, you know, for unless it's an MLS within 24 hours of public

03:17advertising it. And so that kind of eliminated his ability to have those quote unquote, private

03:24listings or that private listing, you know, portal, portal situation. So fast forward to

03:29today, it's kind of morphed into this thing where he's just continued to fight this tooth and

03:34nail. And then the big, like, it's almost like he was kind of gaining traction, whereas it's

03:42like, okay, who's going to win this Zillow or Compass? And then all of a sudden, boom, he

03:46just drops a bomb on the industry and buys anywhere. And now he literally has more agents in his

03:53ecosystem than anyone else by far. And he's able to kind of control the market. And what's

04:00interesting is, you know, like some of these MLSs, some of these local MLSs,

04:04you know, are against these private listings because, you know, like they're not getting

04:09that, you know, the listings on their website and then it doesn't get syndicated to Zillow

04:14and it's like a chain reaction. Well, you know, Robert's like, well, okay, we'll find us

04:19then, you know, and it's like, if you want to take us so far, we'll just leave MLS. So

04:23it's turned into this like portal war kind of situation where everybody kind of has where

04:28they stand on what's happening, but you can't deny what direction we're going in. You know,

04:33we're going to go in a direction where we're going to see some fragmentation, you know,

04:38like you're going to, it's going to, you're going to have to kind of, you're not going

04:41to be able to go. I don't believe in one place and see everything for sale. Like you

04:45can't now. I think that's, that's the direction that we're going to go in and like what the

04:50end, end result is going to be. And in today's world of like AI and technology and stuff, I don't

04:57see it like 20 years ago, 10 years ago, that'd be horrible. But in today's world where we

05:02have all this technology and we have all this great AI that's getting better and better and

05:06better, I don't see it as the worst thing in the world. And it's just like, what side

05:10do you lean on? For me, it's like if a seller isn't getting access to all the buyers, they

05:17can't possibly get the best price or the highest price. Right. And from the buyer's side, if

05:22they can't see everything for sale, they're obviously not, not, that's not great for them

05:26because what if the house they want is privately listed somewhere that they can't find or don't

05:32have access to. And so this is where you find the arguments on both sides when it comes to this.

05:38Right. And then you've got NAR, right. NAR is the national association. Then you have the state

05:42associations. Then you have the local associations and NAR has made it to where you have to be

05:47mandatorily a member of them to have access to your local association and a lot of different

05:52areas. Like most areas, you have to be a national member to have access to your local MLS, to

05:58even be a member of your local MLS, you know? And so it's just like all these things are kind

06:03of, you know, bringing up all of these arguments and it's starting to mold the next, the next

06:11era of the industry, you know? Yeah. And, you know, we see the challenger now to NAR,

06:16right. Um, and I, I think they've been out for what, has it been a year already? Um, so we

06:21had,

06:21uh, Mauricio Mansky, we have, um, Jason. He's been, he's been working on that for a lot longer than a

06:29year. It started to gain a little traction about a year ago. And I work really closely with Mauricio

06:34and Jason and, you know, even connected RealtyCo and ARA, you know, Briggs and Jason. And they've

06:41literally just, oh man, the last really, like you say, the last year, but really here in the last

06:47six months, I mean, they, they signed Remax. Now they signed Compass, you know, and all the different

06:52brokerages in the Anywhere brand. Um, and there's some other really huge announcements coming up for,

06:59for ARA. Um, but they're doing a lot of great work, right? I feel like they're doing the work

07:06that NAR should have been doing the whole time in terms of just providing real value to the agents

07:11outside of just lobbying on Washington. You know, NAR was the largest lobby, like the most contributor

07:18to Washington and like tobacco companies. Okay. Um, like they're the biggest and, uh, it's like,

07:27I'm an, I'm a member. I have to be because of my local MLS. Well, I have no say so

07:31over

07:31what their agenda is or what they're lobbying for. Um, you know, it's like, what, what are we doing?

07:38But ARA, American Real Estate Association, right, is tapping into the, to the needs of agents,

07:44listening to agents and, um, you know, and, and working towards providing real, you know, value

07:50around like healthcare and tax services and legal and things of that nature, which NAR,

07:56never really did, you know? So it's just kind of like,

08:01It's interesting how, how these things are going together, right? So if you think about

08:05NAR and, and the link there to the MLS, to the listings, and then you think about,

08:09we have all these things happening at the same time. It does feel like you said,

08:13it's, it's not going to be the same going forward. There's going to be some change happening.

08:17Well, it's, it's kind of like the lawsuit, the CISR Burnett trial, whereas, you know,

08:21they basically made, you know, created these new standards around, you know, having a buyer sign

08:30a buyer agency agreement before you even talk to them, basically before you even show them a

08:34property. And then in most States, when you take a listing used to take for the full commission and

08:40split it with the buyer agent. Now you don't, you take half the commission, basically your commission,

08:44you know, the 3%, the 2%, the whatever you're charging. And then the, the, the buyer agent puts

08:52what they want in the purchase agreement and is negotiated with the seller directly between,

08:55I guess the buyer and the seller negotiates the buyer commission now, as opposed to how it used

09:00to be. But at the end of the day, it was just kind of a, you know, a paperwork swap

09:05where everything,

09:07nothing really changed. You know, the, the seller still pays the buyer agent commission,

09:11just like they did before. It's just kind of presented a different way and kind of,

09:14shuffled around differently, but it didn't really change.

09:18You had some lawyers make a lot of money. That's what changed it.

09:21Yeah. So I try to, I try to calculate, I think the homeowners got like 27 bucks a piece. It

09:27was

09:27like a half a million property owners. And then like the lawyers, if they were to charge like 30,

09:3140% or whatever they charge, I mean, they got hundreds of millions of dollars, you know,

09:38and the whole time the lawyers were on TV talking about how this was going to basically eliminate

09:43buyer agent commission and commissions, we're going to go down. Do you know right now, Sarah,

09:48that commission rates, right? It's 5.44 is kind of the average commission rate, right? The second,

09:53that's literally the highest in history. And the sister Burnett trial was two years ago is when we,

10:00is when that was resolved. So commission rates have went up since that lawsuit and specifically buyer

10:07agent commissions, the ones that the one, and it's, it's funny because that lawsuit and that

10:14new standard basically created this world where the agents had to prove their value. And also they

10:22were able to negotiate their commission. Whereas before the listing agent basically negotiated the

10:27buyer agent commission because they got it on the front end. Well, now the buyer agent through their

10:31buyer can negotiate what that commission is. We're seeing a lot of cases where, you know,

10:36they would have gotten two and a half or now they're getting three. Um, yeah, it is. It is so

10:42interesting. Um, but yeah, agents and to take it one step further, because a lot of people talk about

10:48we're at 94 levels of transactions and this is, you know, worse than 2008 in terms of home sales. And,

10:54you know, we're in this really bad, you know, housing, housing recessionary period or affordability is

11:00crazy and stuff like that. Do you know, real estate agents collectively are making more money

11:06right now collectively than they have ever made in history, right? So the last three years has been

11:13around $95 billion were paid out to real estate agents. Okay. That blows any year pre pandemic away

11:20in history. Now in 2021, that was the biggest year ever is 117 billion, right? So 20 and 21 or

11:2820,

11:2821 and 22, uh, where we're, we're slightly bigger, but you go back pre pandemic. And that was because of

11:35the post pandemic housing boom, right? You go back pre pandemic, the last three years,

11:42singularly, 2023, 24, 25, or each in their own respective rights, bigger by far, as far as

11:49commissions paid out to agents, right? And this down market that we're in, um, it's so interesting

11:56to look at like real data. I love the chart daddy. People sometimes call me, people, uh, call me chart

12:03daddy jr or chart baby. It was like, I'll break it out. And it's just like, here's the facts.

12:09You know, we see this. So we have real trends verified, right? So we have, we, for decades we

12:14have, um, you know, we have the data on who the top agents are, the top teams, top brokerages.

12:21And you see like people talk about a down market, but like, there's plenty of people who are doing

12:25great. Um, so the, the illusion is, is that people aren't making money, but the fact is,

12:33is, and the reason why it looks that way is because the real data is 5% of agents are

12:40making

12:40half, literally 50%, 5% are making 50% of that commission pool and 15% are doing 99%. So

12:51the bottom

12:5185% 85% are literally fighting over that 1% of the commission pool. And so agents are like,

12:59well,

12:59okay, Ricky agents are making all this money. I'm not seeing any of it. It's like, well,

13:05it's because 5% are making half of it, you know? And really, if you want like agents are making

13:10there,

13:11I know agents who are making more money, like hand over fit, more money than they've ever made.

13:16Like it's crazy how much money they're making in little markets too, not New York, Miami. Like I'm

13:21talking to small markets, regular average agents who have just continued to grind through this time,

13:27recalibrate their business to what, to, to, to the current market levels and environment.

13:32And they've just built this monster of a business during this time. And they're absolutely crushing

13:37it. And like right next to them is an agent that can't pay their bills, you know? And then we

13:42really

13:42have a tell of two agents right now in the market, but I'm just like, if that's what's happening right

13:48now, what do you think it looks like when the market rebounds? You know, it's going to be insane.

13:53If you look at commissions back in 2005, that was the big year back then. There was this peak. Well,

14:00that peak became the new norm in the late teens, like 2018, 19, before the pandemic, that, that peak

14:07became the new norm. And now we have this 117 billion dollar peak in 21. And like, I just look

14:14at that and I'm like, that's going to become the new norm, you know? Yeah. So let's talk about some

14:20of these people who want to new entrance into the market, right? Some of them have been around for a

14:25while because my question at the end of this is going to be like, what does this mean for current

14:30agents? But especially what does this mean for new agents, for people who want to get into the

14:34industry? So if we look at just this year, we see that, you know, Bed Bath & Beyond jumped into

14:40it.

14:40We have Kelly Blue Book jumping into home valuations and they want to do some different

14:47things there, connect people with either real estate agents or lenders. We have Google, which has had

14:53home listings for a while, but they just expanded that to all 50 states, right? So they use House Canary

15:00come home and, and they're, it's designed to drive calls, messages, booked appointments for agents.

15:05So almost like a different kind of Zillow, except they're getting you, they're getting that person

15:09on the search, you know, like you, you type it in. And then on top of all that, we have

15:14AI, which it's

15:15like, listen, if it can just go out there and scrape all this data and MindChat GPT can tell me

15:19what, what house is listed where, like all of these things are potentially, to me, more disruptive

15:25than maybe what we've used that term in the past, just is some, some new technology there.

15:31Yeah. You just never know. Because, you know, if you remember back in the day, like maybe

15:35it's probably 10 years ago now, Amazon kind of like got into the home, the home business,

15:42you know, for a second, they were, you know, they partnered with, uh, I want to say better

15:46homes and garden. You can fact check me, but they partnered with one of those companies and

15:50they were basically going to put like a, you know, an Alexa home service in, in, in the homes

15:55that were bought and they were trying, they were, it was like their way to kind of like

15:58test the waters and inch their way into, and you're like, okay, what's going to happen

16:01here? And we've seen a couple of companies that aren't in the space, try to like get a

16:08foothold in the space and it didn't work out, you know? And so you kind of wonder what these

16:12things, like when, when these things happen, you just kind of have to like step back, watch

16:17it, see what, what transpires because, you know, like they come in hot, everybody's

16:22excited, everybody's either worried or whatever. And then it's a big nothing burger, right?

16:28A lot of times, you know, when you see these outside companies, it's almost like when a

16:33real estate agent tries to go get their mortgage broker license. It's just like, you know, it's

16:38like, no, it's two completely different things, you know, like it is too, like you think, you

16:43know, what's going on. You don't know what's going on. Same thing here, but it's interesting

16:47with Bed Bath & Beyond, you know, what they did, you know, cause they're basically taking

16:51this company that was suffering financially, you know, and they're just trying to revive

16:55it and get their foothold in the market. And, and like, it's going to, it's just going to

16:59be really interesting to see like what actually transpires there. Like I see what they're trying

17:07to do, right? They're, they're, they're like, okay, the housing market is down. Let's invest.

17:11Let's buy a company that is down right now and let's build infrastructure for when the market

17:18rebounds. So I think it's a good strategy. I just don't, I'm just not convinced that

17:25they're going to be the ones to be able to revive that, you know,

17:28That particular one, when it came across the news desk, we're all like, wait, what?

17:33It's like, Bed Bath & Beyond, they're still around?

17:35They really took that Bed Bath & Beyond part to the whole, a whole nother level.

17:40You know, like, okay. Yeah. Way beyond. Um, yeah, I, I can get your point there. And I think that

17:45that's really true. I do think, and, and I think you've made this point on, on social sum is that

17:51like, if people now are, are looking to search or, or to their, um, chat GPT or whoever it is,

17:57their, their AI to say, Hey, um, who should I look at? You know, what's a good real estate agent

18:03or

18:03whatever. And they have these lists. Maybe they look at real trans verified. Maybe they look at a

18:07local list of people. How does that work? If you're new to the, if you want to get into real

18:12estate,

18:12how do you get into that? Because you don't have, I mean, you're never going to be on that list.

18:16I

18:16mean, you, you might be on that list in a couple of years. How do you make it for, for

18:20those first

18:20couple of years? If most, I mean, like in the beginning you're, you're in the beginning, it's

18:25more outbound than inbound, right? Like, so you have to get out there and beat the streets and you have

18:30to figure out, I mean, it all comes down to volume of conversations with the right people and then

18:37getting them to tell you whatever it is that they want to do and why they want to do it.

18:41So you can just

18:42help them do it. Like a lot of people get into real estate and they feel like it's this old

18:46school sales where you have to get people to do things. And they just, they go down this path

18:53and it just doesn't, it doesn't end very well. Right. But if you understand that sales, especially

18:58in today's world, more than ever people, it's like, dude, you know, as well as anybody closings

19:04are happening every day by the truck, it'll never stop. And so it's not a matter of getting

19:11people to buy homes. They're buying homes. Like every day there's like truckloads of people

19:15buying homes in your market. It's not a matter of getting people to buy a home or sell a home.

19:19It's a matter of, can you communicate in a way that makes them feel comfortable enough

19:24with you to open up to you, to tell you everything they want to do and why. So you can

19:28just simply

19:28help them do it. And so now they're buying a house through you and the whole thing is their

19:32idea, right? You're just, you're just guiding them through the process. And if you can get

19:37that one thing and then realize that it's just about conversations with people. So like

19:41we, we did cold calls for a long time, but pickup rates have dropped dramatically. And

19:46so it just doesn't work like it used to. So we've transitioned over to just handwritten

19:51letters, text and email, and we are crushing it. I mean, like, it's like gangbusters, you

19:59know, we're not big on social or not big on Google or not big on like searching on AI

20:04and stuff like that. I want the, I want to be able to pick my client and I know it's

20:08just about me, my level of communication to them. So as a new agent, it's scary because

20:1571% of agents aren't selling anything, but I'm telling you any body, anybody, I don't

20:22care who you are. Anybody can succeed in this business. If you just understand the principles,

20:28you know, and you're like, get out of all this shiny penny like stuff, like worry about

20:35that stuff after we have momentum in your business. I tell like they want to do social

20:38media day one. I'm like, let's do that. Like, like month seven or something, you know, like

20:43let's, let's like, let's get business happening and get like people coming to you and let you

20:49learn how to convert and talk to people and like have some fun with it. And I think that's

20:53agents get in and they get in to have fun, but then it ends up not being so fun. I'm

20:57like, let's, let's get back to having fun, you know, and helping people. So.

21:02Absolutely. I do think some of the things we've talked about make, um, a knowledgeable agent

21:08even, even more important. Right. So if you think about the fact that you're not maybe seeing

21:12all the listings that are out there, well, as a consumer, you don't even know that maybe,

21:17and you don't know where to look and you're not sure, you know, how do I navigate that?

21:22Like you actually now need an agent more, you know, you know, and we can, you know,

21:29last year, a higher percentage of consumers use a real estate agent than ever in history,

21:35all time high, right? When we have more information, they have more information they've ever had

21:40there. They have access to their own buyers and sellers. They've got AI now you've got,

21:47and it's like, why are more people using agents than ever before? And it's exactly what you just

21:51said. The more information they have, the more confusing the process is for them because

21:57they're just bombarded with stuff and to take AI another step. And this is my belief. AI is going

22:04to create so much wealth in the world. I mean, there's all kinds of projections out there. I've

22:10seen 20, 20 trillion by 2030 or whatever it ends up being. It is going to create wealth. You know,

22:18it's going to, it's going to increase GDP globally. And it's just like, where's all that wealth going

22:23to go? Well, it's going to go into real estate. People are going to buy stocks. People are going

22:28to buy businesses. People are going to buy cars. People are going to buy homes. They're going to

22:33buy nicer homes, newer homes, bigger homes, whatever. And, and second homes, third homes,

22:39fourth homes, investment properties, apartment complexes, commercial strips. And I believe that,

22:47that this, this AI era and this, this creation of wealth and GDP is just going to increase the demand

22:56of real estate agents. Uh, I think we're going to have more, I think, you know, people think AI is

23:01going to replace agents. I think it's going to create a scenario where we have actually more real

23:05estate agents than we have now. We're going to have a higher demand of real estate agents, right?

23:10And I still do believe though, that this gap between agents that are crushing it and not the

23:15ones that are crushing it, not selling anything is going to continue to get wider and wider and wider

23:19because of this. There's a thing I like to refer to as age inflation, meaning that every generation

23:25of real estate agents is better than the last. And so as time goes, goes on as an agent, you

23:30have to

23:31become more and more exceptional as an agent. If you take an average agent right now and put him

23:36back in the market 10 years ago, they're like a number one agent in the market. Right. Um, you

23:41know, you take it, same thing with sports, you take LeBron and put him back in the thirties. There's

23:45no debate against like who the goat is. Like it would be him. You take an average basketball player

23:50in the NBA and put him back 10 years ago. He's like one of the greatest ever. So it's the

23:54same thing

23:54with agents. And that's why we're seeing this gap, um, of, of agents who are crushing it and not.

24:00And I believe that it will continue to get worse and worse.

24:03So I, you know, I think something that you've said here also makes me think it's the same thing,

24:09like the referral relationships that you have. So if you're really being the person who's like,

24:13Hey, what do you want? How do I get you what you want? That, that mortgage lender is more important

24:19than ever because, you know, we see on the, on the mortgage side, lots of innovation, lots of them

24:25trying to figure this out. You know, how can, you know, maybe it's a reverse and, and, you know,

24:29new reverse is nothing like the older verse. Maybe it's, there's just a lot here. And so I feel

24:34like the relationships with your clients and then the relationships with your referral partners,

24:39more important than ever.

24:40It, it, it's always been a big deal, but you're right. It's, it's, it's becoming more and more of

24:45a big deal. Um, but like I was a single agent. I didn't have like a team of agents, right?

24:50I was

24:50just a single agent and I had an assistant, but I, I refer to myself as a team because I

24:55had the best

24:56lender in the area. I had the best title company in the area. I had the best inspector and I

25:01had to

25:01go through several mortgage people, several title companies, several inspectors, you know, and all

25:06the other different, you know, different people that you need. I had to go through a lot of them to

25:11find

25:11the person that was the best fit for me that provided the value to my clients that I was,

25:15that I could depend on to, to, to treat my clients the way I needed to be, that they needed

25:20to be

25:20treated. Um, and so you're absolutely right. I mean, that it's so big to have those pillars in

25:27place where you can basically, I never, I never, you'll think this is funny when I was selling

25:34and a client would ask me what the more current mortgage rates were, the current 30 year fix or

25:38whatever. I had no clue because that wasn't my lane, right? My lane was communication, you know,

25:45getting leads, finding out what it is they want to do and why, helping them do it, servicing the deal.

25:50Like if it was something mortgage, it's like, here's the mortgage guy. Like I had no, I was so

25:55oblivious to like data, national data. Now I pay attention to it. Like I read it every day. Um, it's

26:01pretty funny thinking back. Like I didn't, couldn't even tell you what a 30 year fix was, but that just

26:04tells you how important your partners are. Like know what your lane is, know what your role is

26:09in the transaction, in your business model, right? And then have those pillars in place

26:14so that you've got really great people to send your clients to.

26:18Ricky, this has been so interesting. I'm going to have you on again because we need to

26:23check back as things change so fast in this industry, but really appreciate you taking the

26:28time because I, I think it's ironic that what, what I get out of this conversation is that all,

26:32all the things that are changing, it comes back to some things stay the same. And the things that

26:37stay the same are what, you know, how you control what you can control and the relationships on,

26:42on all the sides.

26:44Yeah. Yeah. Yeah. I say the more things change, the more you have to depend on things that never

26:48change. And the thing that never changes is that, or the way to protect yourself against

26:53the ever changing market is your own private network, right? Your own network of people,

26:59right. And what the relationship is we're in. So it's good stuff.

27:03Well, thank you so much for being on and we will talk again soon.

Ricky Carruth on changing the infrastructure of real estate

Category

Transcript

Comments

Recommended