LPT Realty founder and CEO Robert Palmer took the stage Tuesday at HousingWire’s The Gathering in Austin, Texas — outlining growth strategy built on team empowerment, agent retention and a deliberate separation from mortgage origination.
Palmer, who spent roughly 20 years in the mortgage business, has made a pointed decision not to attach a mortgage company, RP Funding, to LPT Realty. The firm offers only servicing and refis, not origination.
Palmer’s remarks came as LPT Realty continues to build momentum.
The firm climbed from No. 10 to No. 7 in transaction sides on this year’s RealTrends Verified brokerage rankings, increasing its total to 61,041 sides.
He said LPT made a strategic choice not to compete with its own agents and teams on mortgage, instead letting them pick the best local mortgage provider, loan officer or joint venture (JV) partner.
“I think it’s become an excuse for large brokerages that are losing money to say, ‘Oh, we need the ancillaries,’” Palmer said. “I love to say it looks great in the spreadsheet. Every big lender and big real estate brokerage who do a JV — you know, spreadsheet together — they’re going to make all this money because they’re going to underpay the loan officers and expect the Realtors to fall in line and use them. And in reality, that doesn’t happen.”
He pointed to recent pivots from major players, including Compass and Anywhere, away from large-scale joint ventures.
“The problem is if you actually pay loan officers what they’re worth — which I think they should be paid — it doesn’t look as good on the spreadsheet anymore,” Palmer said. “And it’s not all of a sudden this super margin creative play for real estate brokerages.”
LPT has remained profitable for two consecutive years while growing 50% to 70% annually, according to Palmer.
“We run the brokerage like a business instead of running the brokerage as a loss leader,” he said. “I think that irresponsibility is what brought me into the industry and why I was confident to leave mortgage behind.”
“Whoever has that consumer relationship is really appreciated influence — you know, [over] who they’re going to do business with,” Palmer said. “And we don’t have that as a cloud brokerage. But the teams here [do], the agents do.”
A ‘team-first’ model for agents at every level
Palmer rejected the industry’s historical tendency to prune lower-producing agents, noting that a large percentage of the industry falls into that bucket.
He recalled watching his mother struggle as an agent, moving between real estate and mortgage work.
“When the market is down and we’re in a 4 million-home sales market like we’ve been in, that marginal agent or lower-producing agent is going to lose the most,” Palmer said. “They’re very dependent on that activity in the industry. But on the flip side, when we get to the boom — we call it boomsday at LPT — the market turns around and we get back to 4.8 million or 5 million home sales.
“That’s going to feel like a bonanza, even though it’s not a great number by historical standards, and we’re going to need those agents to step up and help serve consumers.”
The firm now counts nine of the top 20 teams in the United States and more thousand-unit-plus teams than any other brokerage, Palmer said.
Unlike many models that impose maximum caps on what teams can pay agents, LPT allows team leaders to set compensation as high as they want.
“If they want to put an agent on a 95/5 [split] because they’ve been with them for five years and they don’t need their leads anymore, we support that as a brokerage without changing their economics, where most brokerages don’t,” Palmer said. “That allows our teams to look more like traditional brokers, traditional franchises — and offer that team-for-life construct so the agents don’t have to look at the team as a stepping stone.”
Organic growth and two strategic acquisitions
Rather than acquiring legacy franchise brokerages, Palmer said LPT has focused on organic growth and two technology purchases; Humaniz, a team recruiting platform; and Reside, a coaching and team efficiency platform that also provides outsourced CFO services for teams.
“The idea of buying a larger legacy franchise brokerage, I worry, do they become a cloud brokerage because we bought them, or do we end up becoming a legacy franchise brokerage?” Palmer said.
He said with more than 500 teams inside LPT, growth feeds itself.
“Even if we didn’t attract any new teams — which we do continue to do — we would still grow as a brokerage as we help those teams grow inside of our network,” said Palmer.
He added that both Humaniz and Reside remain brokerage-agnostic. “It’s not about making teams move to LPT,” Palmer said. “It’s about helping teams grow.”
On private listings and the one thing he’d change
Palmer said LPT’s guiding principle on private listings is agent choice, though he called the concept largely irrelevant for most of the firm’s markets where the average sales price is roughly $390,000 to $400,000.
“I understand the idea of private listing if you’re in Manhattan,” Palmer said. “I’ve got a home out in Montana in a neighborhood where everything was a private listing. Nothing has ever hit the MLS. I understand there are certain areas and neighborhoods and properties where that’s necessary.
“But where I live in Central Florida, it’s irrelevant. With a half-million dollar home that was built by a builder in the last couple years, we would be doing a disservice [to add it to] a private listing network.”
Asked what he would change about the industry with a magic wand, Palmer pointed to the lag between effort and reward in real estate.
“The efforts an agent is putting out today — the open houses they’re holding, the neighbors they’re talking to — is not going to turn into any type of revenue for them for [about] four, five, six months down the road,” he said. “We see too many great entrepreneurs who have the potential and the talent, and they just don’t have the ability to last through that lag.
“I think it’s the absolute hardest part of this industry.”