Is Compass Real Estate in trouble?

Posted On Tuesday, 16 August 2022 21:03

As arguably the fastest growing real estate brokerage firm in the entire United States, Compass Real Estate has seen unprecedented highs since its inception in 2012. Operating across a wide range of states including New York, Washington, and California just to name a few, and with a strong digital presence to accommodate real estate inquiries across limitless boundaries, this combination of online and in-person real estate expertise has led to Compass being valued at $8 billion as of last year. 

However, you may have heard some post-pandemic rumblings about Compass due to a few legal issues and other obstacles that the company has endured over the last few years. And with this news, you may have wondered whether this innovative real estate broker was in some serious trouble. 

Fortunately, those past issues have been well and truly resolved, but in keeping with the openness and transparency that has made Compass so successful, it’s important to address the past so that the future can be clearer to potential home buyers and sellers across the country. 

About Compass

For further info on Compass, it’s important to know about the beginnings of the business. Originally known as Urban Compass, this cutting-edge company was founded ten years ago by Robert Reffkin and Orio Allon. With a focus on technology that disrupts the status quo of the real estate industry for the benefit of potential sellers and buyers everywhere, they experienced fast growth and acclaim for their future-focused business practices. 

Compass was actually the first ever company to create a mobile app that was made for real estate agents. This app helped them to provide faster and more efficient service to their clients, a trend that many real estate companies followed afterward. 

About past issues 

Any company that’s managed to achieve so much success in such a short time will inevitably have a few ups and downs over the years. But is Compass Real Estate in trouble? 

Like all businesses, Compass felt the knock-on effect of COVID-19. During the lockdown, the housing market could be extremely volatile, and due to the uncertainty of the world at the time, the demand for real estate significantly diminished. This led to Compass losing $270 million in 2020, at the peak of the pandemic. However, since then, the real estate market has recovered, and Compass has continued to provide the same level of service it always has to its growing list of clients. 

In 2019, Compass faced lawsuits from a competitor, when Zillow filed two lawsuits against the company, claiming that Compass had allegedly stolen trade secrets and poached employees who had signed non-compete clauses in their contracts. Compass strongly denied these allegations, and issued a rebuttal that accused Zillow of using scare tactics in their contracts. The two companies later reached a settlement and the issue has now long been resolved. 

About the future 

With these past obstacles now overcome, Compass has continued to do what it does best - look to the future. By continuing to persevere through these problems, Compass has helped countless clients achieve their real estate goals, winning the 2020 Webby People’s Voice Award for Real Estate in the process.

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