The real estate industry has been disrupted in 2020, but not necessarily to its detriment. In a recent Q&A with Karri Callahan, CFO of the global, franchise-based real estate company RE/MAX, I discussed a variety of issues related to her company and industry, as well as broader topics for finance professionals in the 21st century. In the first part of a two-part series, I asked Karri about how Covid-19 has impacted the real estate industry and how she as CFO has addressed new challenges and opportunities. Additionally, I asked her about RE/MAX’s franchise model and how a central finance leader can effectively manage a sprawling network of brokers all over the world while maintaining a strong company culture
Jeff Thomson: The real estate market tends to suffer in an economic downturn. In the Covid-19 downturn, real estate has been severely impacted, especially in urban centers. However, there have been positive gains for real estate in less populated areas as people look to leave cities. How has this sudden re-balancing of the market impacted RE/MAX’s business and operations? What have you done as CFO to mitigate or capitalize on that impact?
Karri Callahan: One might assume real estate has been slowed by the pandemic and resulting economic downturn, but in reality, while existing home sales were depressed in the late spring and early summer, activity has since strongly rebounded. Many markets across the U.S. are scorching hot – fueled by low interest rates, high demand and very low inventory. There aren’t many houses for sale, but those that do get listed are selling quickly. As we’ve seen, residential real estate has been a bright spot and has the potential of helping to lead in the country’s economic recovery.