Unicorn real estate technology company HomeLight has raised referral fees on agents’ gross commissions to 33%.
The change went into effect on Tuesday, Oct. 25. Prior to the hike, the company’s referral fee was 25% of agent commissions for deals under $4 million and 30% on transactions over $4 million.
In an email sent to agents, HomeLight said it was the first time it has raised its referral commission, according to Inman, which first reported the news.
Several of HomeLight’s competitors take about one-third of the commission income from real estate agent partners. Zillow’s Premier Agent Flex fee is typically about 35% while realtor.com‘s Opcity charges between 30 and 40%, according to Inman. (A referral fee from a fellow agent is typically 25%.)
The email obtained by Inman said the change would allow HomeLight to invest more in marketing and strengthening its products. The company, which connects home sellers with agents, plans to roll out a “text-first experience” to help with client vetting, new strategic partnerships and an improved mobile app.
The company laid off 19% of its workforce in late June, two weeks after it announced it had raised $60 million in capital and $55 million in debt financing. HomeLight at the time said the capital raise placed its market valuation at $1.7 billion, and increased its fundraising total to $645 million.
HomeLight CEO Drew Uher told TechCrunch on June 16, “This fundraise and acquisition allows us to play both offense and defense, expanding our business while also positioning the company to weather uncertainty this year and into next year.”
HomeLight was founded in 2012 with start-up money from Google Ventures.