HomeSmart Franchise Cost, Revenue & Review 2026
- Investment
- $66K – $205K
- Disclosed sales
- not disclosed
- SBA charge-off
- 0.0%
- on 14 loans
Data from FDD filing + SBA 7(a) records
Analysis by FranchiseVerdict Research · Methodology
HomeSmart is a residential real-estate brokerage franchise built on a high-efficiency, technology-driven model. Franchisees run offices recruiting and supporting agents, earning from commissions and fees.
FranchiseVerdict summary · 2026
A HomeSmart franchise requires a total initial investment of $66K – $205K, including a $20K franchise fee. This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. SBA 7(a) loans show a 0.0% charge-off rate across 14 loans[1]. FranchiseVerdict grade: A (Strongest tier), an editorial assessment, not investment advice. Run a live ROI scan →
Sources, dates and evidence
FDD issued: · Data extracted: · Last cited check: · Staleness risk: low - issued within the last 12 months
Evidence: strong✓ Investment (Item 7)✓ Item 19 status✓ Units and owners (Item 20)✓ SBA loan coverage✓ Litigation (Item 3)✓ Financial statements (Item 21)✓ Franchisor identityhow this is scored3 of 3 headline figures on this page cite a page of the filing.
Overview
- Investment
- $66K – $205K
- 50th pct Real Estate
- Avg gross sales
- N/A
- Royalty
- Set by a formula
- Units
- 258
- 69th pct Real Estate
- SBA charge-off
- 0.0%
- % of SBA 7(a) loans not repaid · median varies by category
Quick verdict · Real Estate · color = vs category peers
Green = favorable by >10% vs Real Estate median · No shading = within ±10% · Red = unfavorable by >10% · Source: FDD filings + SBA 7(a)
Data from public FDD filings and SBA records. Not financial advice. Methodology
Bottom line
- COSTTotal investment $66K – $205K including a $20K franchise fee.
- RETURNSThis franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that.
- RISKVerdict A (Strongest tier), verdict score 71/100 (higher is better). SBA loan charge-off rate of 0.0% across 14 loans (well below the franchise average, based on all SBA 7(a) franchise lending, 2010–2025).
- GROWTHNegative: net -4 franchised outlets in the latest year (8 opened, 12 closed); 6 signed but not yet open (Item 20).
- GROWTHSystem growing at 20.6% CAGR over 3 years with 258 total units. Strong expansion trajectory.
Item 1 · who you're contracting with
The Franchisor
Corporate structure & franchisor financials
- Legal entity
- HomeSmart International, LLC
- Parent company
- HomeSmart Holdings, Inc.
- FDD Item 1, page 6 of the 2026 FDD
- Predecessor
- and Affiliates
- Prior franchisor entity
- CEO title
- Chief Executive Officer and Founder
- Matt Widdows
- Incorporated in
- AZ
- HQ
- 8388 East Hartford Dr., Suite 100, Scottsdale, AZ 85255
- Auditor
- Richey, May & Co., LLP
- Audited financials
- Franchisor revenue
- $430.6M
- vs $459.0M prior year
Overview
About
- CEO
- Matt Widdows
- Headquarters
- AZ
- Founded
- 2005
- FDD year
- 2026
- States available
- 40
Can you afford it, and what does the money buy?
Entry cost is about typical for a real estate franchise (near the category median).
Source: FDD 2026 · Items 5–7
FDD Item 7 · 2026 filing
Initial investment breakdown
| Cost component | Low | High |
|---|---|---|
| Initial franchise fee | $20K | $20K |
| Working capital (3–6 mo) | $25K | $50K |
| Equipment, build-out, other | $21K | $135K |
| Total initial investment | $66K | $205K |
Source: HomeSmart 2026 FDD, Items 5 and 7[2]. “Equipment, build-out, other” is computed as total minus disclosed line items above.
Item 7 · what it costs to open + operate
The Vitals
- Total investment
- $66K – $205K
- Middle of category vs category
- Liquid capital req'd
- $25K – $50K
- Bottom third — review vs category
- Franchise fee
- $20K – $20K
- Top 40% of category vs category
- Royalty
- Greater of ($12/agent/month plus $120 per completed side)…
- Ad fund
- Franchise Marketing Accrual Fund Contributions are equal …
- Total fee load
- 4.0%
- vs 9–13% typical
Ongoing fees · Item 6
| Fee | Amount |
|---|---|
| Technology fee | $250 |
| Training fee | $500 |
| Transfer fee | $4K |
| Renewal fee | $10K |
| Total fee load | 4.0% of rev |
ROI & LBO modelsSingle-unit · 25-unit portfolio · editable
HomeSmart makes no financial performance representation in Item 19 of its FDD - a voluntary item under the FTC Franchise Rule - so no unit revenue figures are disclosed. The return models need a revenue figure to start from, and the operating costs that turn gross sales into a profit are in no FDD. Enter your own and the calculator runs on your assumptions — nothing here is modelled until you do.
Returns model · single-unit ROIC
What would one HomeSmart unit return on the cash you put in?
Illustrative category typicals — not sourced to any filing, survey or sample. Replace them with figures from franchisee validation calls before you rely on the output.
Unlevered ROIC · per unit
Your modelled return on total invested capital, before any debt financing.
—
An FDD discloses gross sales, not profit. We hold no sourced figure for annual revenue, royalty rate, ad fund rate, COGS, labour, rent / occupancy and other operating costs, and will not substitute an assumed one. Enter your own and the model runs on your assumptions.
These models are for research and scenario planning only. Not investment advice. Actual results depend on your specific location, management, and market conditions. Consult a franchise attorney and accountant before signing any franchise agreement.
Item 19 · Source: 2026 FDD
Financial Performance
No financial performance representation
This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that.
Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Operator outlook
What the numbers say
Data-driven interpretation of this brand's financial disclosures, fee structure, and system trajectory.
Fee burden
Total ongoing fee load of 4.0% — below the Real Estate median of 7.5%.
Disclosure
This franchisor makes no financial performance representation in Item 19 of its FDD. Item 19 is voluntary under the FTC Franchise Rule, and this filing states that it makes none, so no revenue or earnings figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Operator retention
System expanding at 20.6% CAGR over 3 years across 258 units — operators are staying and new ones are joining.
Source: FDD Item 19 financial performance representations and publicly filed FDD data. Past performance is not indicative of future results. Verify all figures with the franchisor and current franchisees before making any investment decision.
vs Real Estate medians
How HomeSmart Compares
Category median of published Real Estate brands that report the figure; the middle half spans the 25th to 75th percentile and n counts the brands behind it. Medians are used because a few very large systems pull an average far from the typical brand. Revenue is disclosed gross sales, not profit.
Is the system healthy?
Source: FDD 2026 · Item 20
Unit growth
Item 20 · unit dynamics
The Growth Chart
- Total units
- 258
- Opened
- 8
- Last reporting year
- Closed
- 12
- Terminated
- 12
- Franchisor ended the franchise (per Item 20)
- Non-renewed
- 0
- Term expired, not renewed (per Item 20)
- Turnover rate
- 4.7%
- Company-owned
- 57
- Corporate units in the system
- % franchised
- 78%
- vs corporate-owned
- Net growth (3-yr)
- -2.2%
- Net unit change over 3 years
- 3-yr CAGR
- +20.6%
- Compounded over last 3 years
Last fiscal year · Item 20 exits and transfers
- Terminated
- 12
- Not renewed
- 0
- Transferred
- 2
- Reacquired
- 0
- Franchisor bought back
- Signed, not yet open
- 6
- 0.02 per open outlet · Item 20 Table 5
- Projected new
- 16
- Franchisor's next-year forecast
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 30 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator. Not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee contact records (FDD Item 20). Shows states with at least one current operator on file. Full state registration data (Item 12) will appear on a future FDD refresh.
Where the owners are · Item 20 owner list
76 current owners across 28 states; 10 former (terminated, transferred or not renewed) listed separately.
- CA 14
- NY 9
- NJ 7
- IL 6
- WA 4
- CO 3
- MA 3
- FL 2
- GA 2
- ID 2
- LA 2
- MN 2
- +16 more states
Counts only, from the list the franchisor prints in Item 20. Names and phone numbers are for your own due diligence and are not shown here.
SBA loan performance
Government records
SBA Loan Data
Aggregated from SBA 7(a) and 504 loan disclosures, public data unique to FranchiseVerdict.
- Total loans
- 14
- Loan volume
- $8.1M
- Median loan
- $467K
- 50th percentile
- Charge-off rate
- 0.0%
- on 14 loans · rates vary by category · see methodology
Historical SBA 7(a) lending data, not predictive of future performance. How SBA charge-off rates are calculated
- Repayment rate (PIF)
- 100.0%
- 5-yr charge-off
- 0.0%
- Loans approved 2021+
- Active lenders
- 8
- Defaults
- 0
- Typical loan rate
- 5.5%
- avg rate to borrowers
- Franchised industry avg
- 14.8%
- brand beats franchise avg ↓
- Jobs supported
- 658
- 8.1 per loan
- Lender concentration
- 21%
- top lender's share
Borrower mix: 8% went to startups / new businesses, 92% to established operators
Franchise vs independent — in offices of real estate agents and brokers, franchised businesses charge off at 14.8% vs 29.6% for independents — franchising is associated with 50% lower SBA default risk in this category.
Top lenders financing HomeSmart franchisees
Showing 3 of 8 lenders. The full breakdown — every lender, state distribution, interest rates & risk ratings — is in the SBA Lending Report below.
Explore lender portfolios on Bank Reports or regional data on State Reports.
Lender network · 7(a) + 504
SBA Lending Report
Full lending analysis for HomeSmart from SBA 7(a) FOIA data.
- Principal loss rate
- 0.0%
- Avg SBA guarantee
- 75%
- Avg interest rate
- 5.55%
- Lender concentration
- 21.4%
- Job velocity
- 8.1 per $100K
- NAICS benchmark
- 8.5%
- NAICS 531210
- Jobs supported
- 658
Top SBA lendersTop lender holds 21% of loans
| # | Lender | Loans | Volume | Default % |
|---|---|---|---|---|
| 1 | Exchange Bank | 3 | $2.1M | N/A |
| 2 | Enterprise Bank & Trust | 2 | $747K | 0.0% |
| 3 | TD Bank, National Association | 2 | $1.7M | 0.0% |
| 4 | U.S. Bank, National Association | 2 | $710K | 0.0% |
| 5 | Wells Fargo Bank National Association | 2 | $461K | 0.0% |
| 6 | PNC Bank, National Association | 1 | $266K | N/A |
| 7 | First Horizon Bank | 1 | $471K | N/A |
| 8 | City National Bank | 1 | $1.7M | N/A |
Geographic failure vector
| State | Loans | Defaults | Rate |
|---|---|---|---|
| AZArizona | 7 | 0 | 0.0% |
| CACalifornia | 3 | 0 | -- |
| NJNew Jersey | 2 | 0 | 0.0% |
| FLFlorida | 1 | 0 | -- |
| ILIllinois | 1 | 0 | -- |
SBA 7(a) lending trend
Borrower profile
Source: SBA 7(a) + 504 FOIA loan-level data, matched by FranchiseVerdict
With a 0.0% charge-off rate across 14 loans, banks have historically viewed this brand favorably for lending.
What could kill this investment?
SBA loans charge off at 0.0% — 100% below the 16.0% national norm, i.e. lower lender-observed risk.
Source: SBA 7(a) FOIA · FDD Items 3, 21
Risk analysis
FranchiseVerdict rating + FDD Items 3, 4, 8, 16, 21
Risk & Legal
HomeSmart presents meaningful caution-level risk: substantial litigation exposure, absence of financial performance data, opaque royalty mechanics, and going concern status undermine confidence despite unit growth and protected territories.
Litigation (Item 3)
Subject: the franchisor is a named party (defendant).
Washington State AOD (2020) re no-poaching provisions; Umpa v. HomeSmart et al. (W.D. Mo., filed 2023, antitrust class action re MLS commissions, settled 2024 for $4.7M plus practice changes); Boykin v. HomeSmart et al. (D. Nev., 2024, similar antitrust claims, resolved via Umpa settlement); Zawislak/D'Acquisto v. HomeSmart et al. (N.D. Ill., antitrust claims re inflated home prices, pending, HomeSmart denies wrongdoing).
Bankruptcy (Item 4)
None disclosed
Audited financials (Item 21)
Yes · Richey, May & Co., LLP
Franchisor revenue (Item 21)
Franchisor entity revenue (not unit-level)
Item 21 statements are the parent/guarantor HomeSmart Holdings, Inc. and Subsidiaries (consolidated), which guarantees franchisor HomeSmart International, LLC; the franchisor's own statements are not provided. Figures reported in thousands and scaled x1000. FY ended Dec 31, 2025. Balance sheet reconciles (assets 44,604 = liabilities 35,825 + equity 8,779). Consolidated revenue is predominantly real estate brokerage ($420.3M); franchise revenue only $5.4M and affiliated business services $4.8M (other_revenue). Revenue declined YoY ($458.97M 2024 to $430.61M 2025). Auditor issued a clean/unqualified opinion (no going-concern paragraph). Cover page carries a state-mandated "Financial Condition" risk factor stating the franchisor's condition calls into question its ability to provide services and support.
ⓘ These are the parent company's consolidated financials (the parent guarantees the franchisor), not this brand's standalone results — the figure reflects the whole corporate group, not this brand alone.
Supplier relationship · Items 8 & 16
- Franchisor sells you products: No
- Kickbacks from required suppliers: No
- Must buy proprietary products: Yes
- Restricted to system-approved products: Yes
Score breakdown · what drove the 71 / 100 verdict
- 01HIGHSignificant litigation portfolio including tortious interference, class action MLS disputes, TCPA violations, and no-poaching Assurance of Discontinuance—indicating operational and compliance risks
- 02MINORNo Item 19 financial disclosure (Avg Revenue and Net Income not provided)—impossible to assess actual franchisee profitability against $65.5K–$205K investment range
- 03MINORComplex royalty structure with $12/agent/month minimum plus $120/side plus $500/month floor creates unpredictable profit scenarios and potential margin compression
- 04MINORModest unit growth (262 units, 14.5% YoY) in mature real estate franchise segment; growth rate does not offset litigation and disclosure gaps
Severity inferred from the FDD text · not a regulatory classification
What are you signing up for?
Ongoing fees run about 4.0% of sales (royalty + ad fund), before rent and labor.
Source: FDD 2026 · Items 11, 12, 17
FDD Items 12, 15, 17 · continued from Risk & Legal
Contract & Territory Detail
| Initial term | 10 years |
|---|---|
| Renewal term | 10 years |
| Allowed renewalsℹ | 1 |
| Territory type | Protected territory |
| Protected territory | Yes |
| Exclusive territoryℹ | No |
| Online sales rightsℹ | Restricted |
| Franchisor can compete | Yes |
| Hire a manager? | Allowed |
| Owner-operator | Required |
| Right of first refusalℹ | Yes |
| Transfer requires consent | Yes |
| Termination notice | 30 days |
| Mandatory arbitration | Yes |
| Arbitration location | Arizona |
| Jury trial waiver | Yes |
| Governing law | Arizona |
| Litigation count | 4 |
View Item 3 litigation summary
Washington State AOD (2020) re no-poaching provisions; Umpa v. HomeSmart et al. (W.D. Mo., filed 2023, antitrust class action re MLS commissions, settled 2024 for $4.7M plus practice changes); Boykin v. HomeSmart et al. (D. Nev., 2024, similar antitrust claims, resolved via Umpa settlement); Zawislak/D'Acquisto v. HomeSmart et al. (N.D. Ill., antitrust claims re inflated home prices, pending, HomeSmart denies wrongdoing).
Items 10, 11
Training & Operations
- Classroom training
- 40 hrs
- On-the-job training
- 0 hrs
- Training location
- Scottsdale, Arizona (corporate headquarters) or another location designated by Franchisor
- Ongoing training
- Required
- Time to open
- 4 mo
- From signing to launch
- Site selection
- franchisee
- Franchisor financing
- Not offered
- Item 10
- POS system
- RealSmart Broker TM
- Operating tech stack
Items 5 & 11
Franchisor Support
Technology: RealSmart Broker TM
Item 20 · call current owners
Franchisee Contacts
86 owners to call
Name · phone · city · state. Extracted from FDD Item 20
Frequently asked questions
Frequently Asked Questions
How much does it cost to open a HomeSmart franchise?
The total investment to open a HomeSmart franchise ranges from $66K – $205K, with an initial franchise fee of $20K. This includes real estate, equipment, inventory, and working capital as disclosed in their Franchise Disclosure Document (FDD).
What do HomeSmart franchise owners earn?
HomeSmart makes no financial performance representation in Item 19 of its FDD - a voluntary item under the FTC Franchise Rule - so no unit revenue figures are disclosed. Declining to publish one is lawful and is not evidence of how the outlets perform. It does mean that less about this brand can be verified from its filing, and the FranchiseVerdict grade - an editorial assessment, not investment advice - reflects that. Item 20 of the FDD lists current and former franchisees; asking them directly is the standard way to fill this gap.
Who owns HomeSmart?
HomeSmart is franchised by HomeSmart International, LLC. Its parent company is HomeSmart Holdings, Inc.. Source: FDD Item 1, 2026 filing.
What is Item 19 in the HomeSmart FDD?
The FDD section where a franchisor may disclose financial performance of its outlets. Disclosure is optional and formats vary; figures are typically gross sales, which is revenue before expenses, not profit. FranchiseVerdict extracts these figures directly from the HomeSmart FDD and qualifies whose outlets they describe.
What is HomeSmart's franchise failure rate?
Based on SBA 7(a) loan data, HomeSmart has a charge-off rate of 0.0% across 14 loans, meaning 0.0% of franchise loans were charged off. Charge-off rates are one proxy for franchise risk, though they do not capture all closures. This data comes from FOIA-sourced SBA lending records.
How many HomeSmart franchise locations are there?
As of their most recent FDD filing, HomeSmart has 258 total units in the United States, including 201 franchised units and 57 company-owned units. 8 new units were opened in the latest reporting year.
Is HomeSmart a good franchise to buy?
FranchiseVerdict rates HomeSmart as a A-grade franchise with a verdict score of 71 out of 100 (higher is better). The grade is a deterministic score built from six weighted dimensions — financial health, unit economics, unit growth, scale, legal, and transparency — then calibrated against SBA loan charge-off rates and FDD age. Transparency is one of the six, so a filing that discloses less scores lower on that dimension than one that discloses more. Our rating is based solely on publicly available FDD and government data; we recommend speaking with current franchisees before making any investment decision. This is not investment advice.
Data sourced from public FDD filings and SBA 7(a) FOIA records. Not financial advice.
For franchisors
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Data extracted from public FDD filings and SBA 7(a) loan disclosures (FOIA). This information is provided for research purposes only and does not constitute financial, legal, or investment advice. Verify all figures with the franchisor's current Franchise Disclosure Document before making any investment decision.