The US residential real estate brokerage and management industry includes about 165,000 companies with combined annual revenue of about $170 billion. Major residential leasing and management companies include Equity Residential, AvalonBay Communities, Health Care REIT, and Essex Property Trust; major residential real estate brokers include NRT LLC, HomeServices of America, Long & Foster, and ZipRealty. The industry is fragmented: the 50 largest companies account for less than 30 percent of revenue.
COMPETITIVE LANDSCAPE
Demand is driven by population growth. The profitability of residential real estate brokerage and management companies depends on demand for properties and the volume of transactions they handle, both of which are usually higher during periods of strong economic growth and can be negatively impacted by a recession or too much new construction. Large companies have only modest economies of scale and benefit mainly from better name recognition than smaller rivals. Small companies compete effectively by developing expertise in a single market or region.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major services include real estate brokerage (45 percent of industry revenue), leasing residential units to tenants (35 percent), and property management (15 percent). Many companies provide multiple services; for example, companies that lease residential units to tenants might also manage the properties. Some residential real estate leasing companies operate as real estate investment trusts (REITs), which are covered in a separate industry profile.
Residential real estate leasing involves connecting property owners with tenants. Leasing companies might represent properties ...
