Real Brokerage Surges 77% While the U.S. Housing Market Stalls

While the Market Flatlines, Real Doubles Its National Share

In a stagnant U.S. housing market, Real Brokerage delivered standout performance in Q1 2025. While the broader market for existing-home sales remained flat, Real’s closings jumped 77% to 33,617 transactions, effectively doubling its national market share to approximately 3%. The company also expanded its agent base significantly, with a 61% year-over-year increase to 26,870 active agents. These figures highlight Real’s ability to scale even as legacy competitors struggle to maintain momentum in a high-rate environment.

Profitability Metrics Lead the Path to GAAP Breakeven

Real is showing financial discipline ahead of its GAAP profitability target. In the latest quarter, the company reported $8.3 million in adjusted EBITDA and $16 million in operating cash flow, even with a gross margin of only 9.6%. According to Street estimates, Real is on track to reach its first GAAP breakeven as early as Q2 2025, positioning itself as a scalable and cash-efficient disruptor in residential brokerage.

High-Margin Ancillary Businesses Still Underexploited

Real’s title, mortgage, and wallet services currently account for less than 1% of total revenue. However, these segments are scaling quickly and could become significant profit drivers. A broader rollout could add one to two points of EBITDA margin over the next 18 months, especially as these products command higher take rates and lower acquisition costs.

Revenue Trails Transaction Volume – And That’s a Strategic Opportunity

While transaction volume has surged, revenue growth has lagged slightly. Roughly 12% of Real’s agents already generate half the firm’s brokerage revenue. This dynamic signals significant upside: once Real completes its market penetration phase, management could raise commission caps, add post-cap fees, or roll out paid AI tools. Each 100 basis point increase in take-rate could contribute $10–12 million in gross profit, enough to turn a flat-sales year into a profitable one.

Q2 Results Could Validate the Scalable Model

The upcoming Q2 earnings report, expected in early August, could mark a strategic inflection point. Management is guiding toward the company’s first GAAP breakeven quarter, and if that guidance holds, it would validate Real’s operating leverage and cost-efficiency thesis in a sector dominated by bloated cost structures.

Consumer Portal Launch in 2H 2025 Adds More Firepower

Real plans to launch its Flyhomes consumer portal in the second half of 2025. The platform will integrate Zillow-level search tools with innovative “buy-before-you-sell” financing features, creating a seamless digital funnel that could increase conversion and boost mortgage attachment rates. The move represents a major step toward building a full-stack real estate ecosystem under one brand.

Macro Tailwinds: Rate Cuts Could Catalyze Transaction Growth

Historically, every 50-basis-point drop in 30-year mortgage rates leads to a 6% to 10% increase in existing-home sales within 12 months. If the Federal Reserve begins easing rates this fall, Real’s transaction volumes could ramp almost linearly, aligning with macro housing cycles and consumer demand.

Valuation Still Lags Fundamentals – Analysts See Upside

Analysts are taking notice. Roth Capital has set a price target of $7.50, and B. Riley recently initiated coverage with a target of $7.00, both significantly above the current trading price of under $4.50. The company is currently trading at just 0.7x forward sales, a level rarely seen for cash-flow-positive tech-enabled brokerages with a clear growth runway.

Risks Remain – But So Does Multi-Year Upside Potential

The market rewards Real only as long as it continues adding agents above the 40% annual clip and outpaces macro transaction benchmarks. A miss on either front could trigger volatility. However, continued execution over the next two to three years could plausibly drive the stock 3x to 5x higher, even with modest pricing adjustments and single-digit EBITDA margins. Real’s ability to generate free cash flow at this stage is a critical advantage.

Structural Advantages Over Traditional Players

Unlike Rocket, Real is less sensitive to mortgage spread volatility. Compared to Zillow, it is less dependent on ad cycles. And unlike Redfin, Real avoids balance-sheet burdens from legacy iBuying. If management continues to validate its model each quarter, the market’s reluctance to value the firm above 1x forward sales may itself be the anomaly. The company appears well-positioned to redefine what a scalable, tech-native real estate brokerage looks like.