Release Date: April 23, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you provide more color on the Homes.com production this last quarter, including win-loss rates, inbound versus outbound, and decision cycle?
A: Andrew C. Florance, Founder, CEO & Director of CoStar Group, Inc., noted that Homes.com exceeded expectations, primarily driven by outbound efforts. There was strong inbound interest and significant sales at industry events. The sales cycle is notably fast, often closing simultaneously with demos. There isn't a significant win-loss scenario as the service is unique in the U.S., and most sales involve individual agents paying by credit card at the end of a demo. About 90% of agents opt for an annual agreement, indicating strong product acceptance.
Q: How do you see the average price of Homes.com memberships changing as growth matures?
A: CEO Andrew C. Florance explained that the current pricing around $475 to $500 per month is likely to remain stable. The pricing strategy is designed to be competitive yet profitable, and there has been minimal resistance to it. The focus is on broad market adoption rather than adjusting prices in the short term.
Q: What are your plans for adding additional premium tiers to Homes.com, and how might this affect average rates over time?
A: Andrew C. Florance mentioned that while there is demand for premium tiers, the company's immediate focus is on achieving high penetration with the basic membership. Premium tiers might be considered once significant market penetration is achieved. This strategy is intended to foster widespread adoption before segmenting the offering further.
Q: What is the outlook for unit deliveries in the Apartments.com segment, and how might this impact growth rates going into 2025?
A: Andrew C. Florance discussed that unit deliveries are expected to remain high by historical standards, which is beneficial for Apartments.com. The current environment with elevated vacancy rates is seen as favorable for the platform's growth, although stability in the market would be welcomed in the coming years.
Q: Can you discuss the integration and future plans for Matterport within CoStar's ecosystem following its acquisition?
A: CEO Andrew C. Florance expressed confidence in significantly accelerating Matterport's revenue growth both as a standalone product and integrated within CoStar's platforms like Homes.com and Apartments.com. The acquisition is expected to enhance CoStar's offerings by incorporating advanced 3D digital twin technologies across its platforms.
Q: What are the key draws for agents subscribing to Homes.com without current listings?
A: Andrew C. Florance highlighted that Homes.com provides value even to agents without listings by enhancing their visibility and connecting them with potential clients. The platform helps agents establish their presence in the market, which is crucial for new or less experienced realtors.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
