Daily Archives: February 9, 2018

It Takes 11 Years for a Single Homebuyer to Save for a Down Payment

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– Saving for a down payment on the median U.S home takes six years longer for a single person than a couple, according to a new Zillow analysis.

– Less than half of all U.S. homes are affordable for a single homebuyer.

– A single buyer can afford a home up to $176,100, less than the national median home value.

– A married or partnered couple could afford a home worth more than twice as much as a home a single homebuyer could afford.

Seattle, WA – Feb. 9, 2018 (PRNewswire) In today’s highly competitive housing market, finding an affordable home can feel increasingly out of reach, especially for singles.

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A single homebuyer would need to save for nearly 11 years to reach a 20 percent down payment on the typical U.S. home, according to a new Zillow® analysis. However, for married or partnered couples, it would take less than five years. In San Jose, California, a single buyer would need more than 30 years to save for a down payment – longer than the lifespan of a typical home loan.

Zillow’s analysis combined home values and income data from Census to estimate how long it would take for both an individual and couple to save for a 20 percent down payment on the median-priced home, assuming they saved 10 percent of their income every year.

Single buyers typically have a smaller budget than couples, which leaves them with fewer homes to choose from and limits them to the most in-demand portion of the housing stock. The number of homes for sale is limited across the country, down nearly 11 percent over the past year, and nearly 18 percent for the least expensive homes. A single person could afford to buy less than half (45 percent) of the U.S. housing stock, compared to a married or partnered couple, who could afford 82 percent of all homes.

“Nearly two-thirds of Americans agree that buying a home is a central part of living the American Dream, but for unmarried or un-partnered Americans, that dream is increasingly out of reach,” said Zillow senior economist Aaron Terrazas. “Single buyers typically have more limited budgets, which means they are likely competing for lower-priced homes that are in high demand. Having two incomes allows buyers to compete in higher priced tiers where competition is not as stiff.”

The difference between what a single person could afford compared to a couple is greatest in Portland, Oregon, and Sacramento, California. In Portland, 73 percent of homes are affordable to a couple, but only 6 percent are affordable to a single buyer. For Sacramento buyers, a couple could afford 75 percent of homes while a single homebuyer could afford 8 percent of homes.

Single buyers will have it easiest in Indianapolis, where saving for a down payment takes less than eight years, and they can afford the highest share of homes among the largest American housing markets.

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Zillow is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts, and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group, Inc. (NASDAQ: Z and ZG), and headquartered in Seattle.

Ellie Mae Reports Fourth Quarter and Full Year 2017 Results

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Pleasanton, CA – February 08, 2018 (BUSINESS WIRE) Ellie Mae® (NYSE:ELLI), the leading cloud-based platform provider for the mortgage finance industry, today reported results for the fourth quarter and full year ended December 31, 2017.

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Fourth Quarter 2017 Highlights

  • Revenues of $112.9 million, up 17% from $96.2 million in 2016
  • Net income of $9.9 million(1), down from $10.9 million in 2016
  • Adjusted EBITDA of $28.5 million, down from $29.4 million in 2016
  • 11,000 Encompass seats booked

Full Year 2017 Highlights

  • Revenues of $417.0 million, up 16% from $360.3 million in 2016
  • Net income of $52.9 million(1), up from $37.8 million in 2016
  • Adjusted EBITDA of $122.6 million, up from $113.1 million in 2016
  • 40,800 Encompass seats booked

“It was a great finish to the year as we continued to gain market share and extend Encompass further into the enterprise segment,” said Jonathan Corr, president and CEO of Ellie Mae. “Our fourth quarter financial results exceeded expectations while seat bookings of 11,000 were also better than expected as more lenders are recognizing the power of the Encompass NG Lending Platform to increase productivity and efficiency.”

“During the year we made significant progress extending our leadership position. We introduced new products, including our Encompass Connect Suite of solutions, which leverage our new open and scalable architecture, completed the acquisition of Velocify which accelerates our delivery of the front end digital experience, and continued the development and rollout of our next generation lending platform. We see tremendous long-term growth opportunities as we drive toward our goal of end-to-end automation of the mortgage process,” concluded Mr. Corr.

Financial Results

Total revenue for the fourth quarter of 2017 was $112.9 million, compared to $96.2 million for the fourth quarter of 2016. Net income for the fourth quarter of 2017 was $9.9 million(1), or $0.28 per diluted share, compared to $10.9 million, or $0.31 per diluted share, for the fourth quarter of 2016. Fourth quarter 2017 net income(1) reflects the impact of changes to the GAAP tax treatment of stock compensation benefits(1) and a benefit resulting from the Tax Cuts and Jobs Act of 2017.

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1. Please see paragraph titled, “Note Regarding Employee Share-Based Payment Accounting Standard.”

On a non-GAAP basis, adjusted net income for the fourth quarter of 2017 was $11.8 million, or $0.33 per diluted share, compared to $16.2 million, or $0.46 per diluted share, for the fourth quarter of 2016. Adjusted EBITDA for the fourth quarter of 2017 was $28.5 million, compared to $29.4 million for the fourth quarter of 2016. GAAP and non-GAAP per share results for the quarters ended December 31, 2017 and December 31, 2016 include the effect of an additional 3.2 million shares of Common Stock from our follow-on equity offering in August 2016.

Total revenue for 2017 was $417.0 million, compared to $360.3 million for 2016. Net income for 2017 was $52.9 million1, or $1.48 per diluted share, compared to $37.8 million, or $1.15 per diluted share, for 2016. Full year 2017 net income1 reflects the impact of changes to the GAAP tax treatment of stock compensation benefits1 and a benefit resulting from the Tax Cuts and Jobs Act of 2017.

On a non-GAAP basis, adjusted net income for 2017 was $58.9 million, or $1.64 per diluted share, compared to $60.6 million, or $1.85 per diluted share, for 2016. Adjusted EBITDA for 2017 was $122.6 million, compared to $113.1 million for 2016. GAAP and non-GAAP per share results for the years ended December 31, 2017 and December 31, 2016 include the effect of an additional 3.2 million shares of Common Stock and 1.3 million weighted average shares of Common Stock, respectively, from our follow-on equity offering in August 2016.

First Quarter and Full Year 2018 Financial Outlook

Our guidance is provided utilizing ASC 605. We are in the process of finalizing our guidance under ASC 606, and we will present an updated guide under both ASC 606 and ASC 605 when we report results for the first quarter of 2018. We will adopt ASC 606 using the modified retrospective method. The adoption of ASC 606 could have an effect on the timing of both revenue recognition and the recognition of costs to obtain contracts including commissions.

For the first quarter of 2018, our revenue is expected to be in the range of $107.0 million to $109.0 million. Net loss is expected to be in the range of $(9.0) million to $(8.0) million, or $(0.26) to $(0.23) per basic share, which reflects additional implementation costs related to the adoption of ASC 606 and the amortization of intangible assets and integration costs related to the Velocify acquisition. On a non-GAAP basis, adjusted net income is expected to be in the range of $2.4 million to $3.4 million, or $0.07 to $0.09 per diluted share, which reflects the non-GAAP tax adjustment. Adjusted EBITDA is expected to be in the range of $13.6 million to $15.6 million. Per share guidance assumes a weighted average share count of approximately 36 million.

For the full year 2018, revenue is expected to be in the range of $495.0 million to $505.0 million. Net income is expected to be in the range of $10.0 million to $14.0 million, or $0.28 to $0.38 per diluted share. On a non-GAAP basis, adjusted net income is expected to be in the range of $61.0 million to $65.0 million, or $1.68 to $1.78 per diluted share, which reflects the non-GAAP tax adjustment. Adjusted EBITDA is expected to be in the range of $126.7 million to $132.0 million. Per share guidance assumes a weighted average share count of approximately 37 million.

Additional information about the non-GAAP financial measures presented in this release, including a reconciliation of the non-GAAP financial measures to their related GAAP financial measures, is set forth below under the section entitled, “Use of Non-GAAP Financial Measures.”

Quarterly Conference Call

Ellie Mae (the “Company”) will discuss its fourth quarter and full year 2017 results today, February 8, 2018, via teleconference at 4:30 p.m. Eastern Time. To access the call, please dial 877-723-9502 or 719-325-4835 at least five minutes prior to the 4:30 p.m. Eastern Time start time. A live webcast of the call will be available on the Investor Relations section of the Company’s website at http://investor.elliemae.com. An audio replay of the call will be available through February 22, 2018 by dialing 888-203-1112 or 719-457-0820 and entering access code 3311197.

Use of Non-GAAP Financial Measures

Ellie Mae provides investors with the non-GAAP financial measures of adjusted net income, adjusted EBITDA, adjusted gross profit, and free cash flow in addition to the traditional GAAP operating performance measure of net income as part of its overall assessment of its performance. Adjusted net income consists of net income plus stock-based compensation expense, amortization of intangible assets, acquisition-related costs, and the non-GAAP income tax adjustments. EBITDA consists of net income plus depreciation and amortization, amortization of intangible assets, and income tax provision, less other income, net. Adjusted EBITDA consists of EBITDA plus stock-based compensation expense. Adjusted gross profit consists of gross profit plus stock-based compensation and amortization of intangible assets that are included in cost of revenues. Free cash flow consists of net cash provided by operating activities less acquisition of property and equipment and internal-use software. Ellie Mae uses adjusted net income, adjusted EBITDA, and adjusted gross profit as measures of operating performance because they enable period to period comparisons by excluding potential differences caused by variations in the age and depreciable lives of fixed assets, amortization of intangible assets, acquisition-related costs, and changes in interest expense and interest income that are influenced by capital market conditions. The Company also believes it is useful to exclude stock-based compensation expense from adjusted net income, adjusted EBITDA, and adjusted gross profit because the amount of non-cash expense associated with stock-based awards made at certain prices and points in time (a) do not necessarily reflect how the Company’s business is performing at any particular time and (b) can vary significantly between periods due to the timing of new stock-based awards. The non-GAAP income tax adjustments are calculated based on the annual non-GAAP effective tax rate, which quantifies the tax effects of the non-GAAP adjustments and reverses the one-time measurement of the tax impact from the enactment of the Tax Cuts and Jobs Act, and the excess tax benefits from the adoption of ASU 2016-09 for GAAP purposes. These non-GAAP financial measures are not measurements of the Company’s financial performance under GAAP and have limitations as analytical tools. Accordingly, these non-GAAP financial measures should not be considered a substitute for, or superior to, net income, operating income, gross profit, operating cash flow or other financial measures calculated in accordance with GAAP. The Company cautions that other companies in Ellie Mae’s industry may calculate adjusted net income, EBITDA, adjusted EBITDA, adjusted gross profit, and free cash flow differently than the Company does, further limiting their usefulness as comparative measures. A reconciliation of net income to adjusted net income, EBITDA and adjusted EBITDA, gross profit to adjusted gross profit, and operating cash flow to free cash flow is included in the tables below.

Note Regarding Employee Share-Based Payment Accounting Standard

Ellie Mae adopted an accounting standard issued in 2016 whereby excess tax benefit generated upon the settlement or exercise of stock awards are no longer recognized as additional paid-in capital but are instead recognized as an income tax benefit. The adoption was effective January 1, 2017, and the Company recognized a benefit to GAAP net income of $15.9 million for the year ended December 31, 2017. This also had the accounting effect of increasing net cash provided by operating activities by $10.2 million and $4.8 million and a corresponding $10.2 million and $4.8 million decrease in net cash provided by financing activities for the full year and fourth quarter ended December 31, 2016, respectively.

Disclosure Information

Ellie Mae uses the investor relations section on its website as the means of complying with its disclosure obligations under Regulation FD. Accordingly, we recommend that investors should monitor Ellie Mae’s investor relations website in addition to following Ellie Mae’s press releases, SEC filings, and public conference calls and webcasts.

About Ellie Mae

Ellie Mae (NYSE:ELLI) is the leading cloud-based platform provider for the mortgage finance industry. Ellie Mae’s technology solutions enable lenders to originate more loans, lower origination costs, and reduce the time to close, all while ensuring the highest levels of compliance, quality and efficiency. Visit EllieMae.com or call (877) 355-4362 to learn more.

Forward-Looking Statements

This press release contains forward-looking statements under the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. These forward-looking statements include projected revenue, net income, adjusted EBITDA, and adjusted net income for the first quarter and fiscal year 2018, as well as statements regarding Ellie Mae’s ability to successfully integrate Velocify’s software solutions with Ellie Mae’s software solutions and the potential benefits of the combined software solutions. These statements involve known and unknown risks, uncertainties, and other factors that may cause Ellie Mae’s results to be materially different than those expressed or implied in such statements. Such differences may be based on factors such as changes in the volume of residential mortgages in the United States; changes in other macroeconomic factors affecting the residential real estate industry; the impact of the Company’s implementation of Accounting Standards Codification (ASC) 606 Revenue from Contracts with Customers on its results of operations, including its projected revenue, net income, adjusted EBITDA, and adjusted net income for the first quarter and fiscal year 2018; changes in strategic planning decisions by management; the Company’s ability to manage growth and expenses as it continues to scale its business; reallocation of internal resources; costs incurred and delays in developing new products; changes in anticipated rates of SaaS seat additions, and new customer acquisitions; the possibility that economic benefits of future opportunities may never materialize, including unexpected variations in market growth and demand for the acquired products and technologies; delays and disruptions, including changing relationships with partners, customers, employees or suppliers; the satisfactory performance, reliability and availability of the Company’s products and services; the amount of costs incurred in connection with supporting and integrating new customers and partners; ongoing personnel and logistical challenges of managing a larger organization; changes in other macroeconomic factors affecting the residential real estate industry, and other risk factors included in documents that Ellie Mae has filed with the U.S. Securities and Exchange Commission (“SEC”), including but not limited to its Annual Report on Form 10-K for the year ended December 31, 2016, as updated from time to time by the Company’s quarterly reports on Form 10-Q and its other filings with the SEC. Other unknown or unpredictable factors also could have material adverse effects on Ellie Mae’s future results. The forward-looking statements included in this press release are made only as of the date hereof. Ellie Mae cannot guarantee future results, levels of activity, performance or achievements. Accordingly, you should not place undue reliance on these forward-looking statements. Finally, Ellie Mae expressly disclaims any intent or obligation to update any forward-looking statements to reflect subsequent events or circumstances, unless otherwise required by law.

© 2018 Ellie Mae, Inc. Ellie Mae®, Encompass®, AllRegs®, the Ellie Mae logo and other trademarks or service marks of Ellie Mae, Inc. appearing herein are property of Ellie Mae, Inc. or its subsidiaries. All rights reserved. Other company and product names may be trademarks or copyrights of their respective owners.

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Realogy Makes Executive Moves in Owned Brokerage and Franchise Group Business Segments

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Sue Yannaccone Appointed Regional EVP for NRT’s Brokerage Operations; Simon Chen Promoted to President & CEO of ERA Real Estate; Fred Schmidt to Retire from Coldwell Banker Commercial

Madison, NJ – Feb. 9, 2018 (PRNewswire) Realogy Holdings Corp. (NYSE: RLGY) today announced several senior executive moves within NRT, its company-owned brokerage operations, and Realogy Franchise Group, its residential real estate franchising business. The changes include:

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  • Sue Yannaccone was appointed as Regional Executive Vice President at NRT. Effective March 5, 2018, she will be responsible for NRT’s Coldwell Banker brokerage operations in the Eastern Seaboard and Midwest regions, and also will oversee NRT’s national commercial real estate brokerage support team. Yannaccone most recently served as President & CEO of ERA Franchise Systems for the past two years after joining ERA as its Chief Operating Officer in 2015. She has two decades of industry experience in brokerage operations and franchise management.
  • Simon Chen was promoted to President & CEO of ERA Franchise Systems, where he will succeed Yannaccone effective March 5, 2018. He previously served as the brand’s Chief Operating Officer and was responsible for supporting ERA’s growth goals specifically around increasing agent productivity and enhancing market share. Chen joined ERA in May 2017 and has a strong business background with a focus on technology consulting and real estate operations. ERA will now begin a national search for a new chief operating officer.
  • Fred Schmidt, who has served as President and Chief Operating Officer of Coldwell Banker Commercial Affiliates, has announced his plans to retire on June 1, 2018, after a distinguished 15-year career with Realogy and more than 35 years overall in commercial real estate. He joined Coldwell Banker Commercial (CBC) in 2003 and has led the brand as its president for the past eight years. Moving forward, the CBC organization will be further integrated with Coldwell Banker Real Estate LLC under the leadership of current President & CEO Charlie Young, who is responsible for the Coldwell Banker residential and commercial franchise systems.

QUOTES:

“The internal changes we made today are intended to take advantage of our leadership talent and deep bench across Realogy to best position us to deliver on our growth strategy that is aligned with serving and supporting agents. While focusing on the highest points of leverage, we are also taking steps to improve our agility and streamline our respective franchise and brokerage businesses. We are working closely together to accelerate change and more closely synchronize our organizations to support Realogy’s agent-centric strategy and ultimately drive better business results.”
— Joint statement from John Peyton, President & CEO, Realogy Franchise Group and Ryan Gorman, President & CEO, NRT LLC

“Sue Yannaccone is a proven real estate leader whose deep expertise in brokerage operations and franchise management will be an incredible asset to NRT as we increase our management focus on and support of enhanced agent services in our core brokerage business. She now joins Greg Macres and Kate Rossi as our senior-most operators responsible for our Coldwell Banker-branded NRT operations.”
— Ryan Gorman, President & CEO, NRT LLC

“Simon Chen has brought a unique perspective to the ERA brand based on his entrepreneurial background in technology and real estate. He is ready to take the next step forward and lead the growth of this great franchise into the future, and we congratulate him on this well-earned promotion.

“Also, we thank Fred Schmidt for his 15 years of leadership at Coldwell Banker Commercial and Realogy, and wish him well in his retirement. Under Charlie Young’s leadership, we will now align the Coldwell Banker commercial and residential real estate organizational structure in a more integrated manner to better serve our affiliated agents and brokers.”
— John Peyton, President & CEO, Realogy Franchise Group

About Realogy Holdings Corp.
Realogy Holdings Corp. (NYSE: RLGY) is a leading provider of residential real estate services that is focused on empowering independent sales agents to best serve today’s consumers. Realogy delivers its services through its well-known industry brands including Better Homes and Gardens® Real Estate, CENTURY 21®, Coldwell Banker®, Coldwell Banker Commercial®, Corcoran®, ERA®, Sotheby’s International Realty® as well as NRT, Cartus, Title Resource Group and ZapLabs, an in-house innovation and technology development lab. Realogy’s fully integrated business model includes brokerage, franchising, relocation, mortgage and, title and settlement services. Realogy provides independent sales agents access to leading technology, best-in-class marketing and learning programs, and support services to help them become more productive and build stronger businesses. Realogy’s affiliated brokerages operate around the world with approximately 192,600 independent sales agents in the United States and approximately 94,000 independent sales agents in more than 100 other countries and territories. Realogy is headquartered in Madison, New Jersey.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements, other than those of historical fact, contained in this report, are forward-looking statements including, but not limited to, statements regarding the Company’s leadership changes. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Realogy Holdings Corp. to be materially different from those expressed or implied by such forward-looking statements, including that there can be no assurance that the Company’s leadership changes will result in the anticipated benefits to the Company. Any forward-looking statements speak only as of the date of this press release and, except to the extent required by applicable securities laws, the Company expressly disclaims any obligation to update or revise any of them to reflect actual results, any changes in expectations or any change in events. For additional information concerning risks, uncertainties and other factors that may cause actual results to differ from those anticipated in the forward-looking statements, and risks to the Company’s business in general, please refer to Realogy Holdings Corp.’s SEC filings, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2016 and its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2017.