Contract Cost Assets

9 Months Ended

Sep. 30, 2020

Revenue from Contract with Customer [Abstract]

Contract Cost Assets

Contract Balances

Accounts receivable represent our unconditional right to consideration. Accounts receivable are generally due within 30 days and are recorded net of the allowance for doubtful accounts.

Contract assets represent amounts for which we have recognized revenue for contracts that have not yet been invoiced to our customers. Contract assets are primarily related to our Premier Agent Flex and rentals pay per lease offerings, whereby we estimate variable consideration based on the expected number of real estate transactions to be closed for Premier Agent Flex and qualified leases to be secured for rentals pay per lease and recognize revenue when we satisfy our performance obligations under the corresponding contracts. We do not believe that a significant reversal in the amount of cumulative revenue recognized will occur once the uncertainty related to the number of real estate transactions to be closed and qualified leases to be secured is subsequently resolved. Total contract assets were $13.6 million as of September 30, 2020. We had an immaterial amount recorded as of December 31, 2019. Contract assets are recorded within Prepaids and other current assets in our condensed consolidated balance sheets.

Contract liabilities consist of deferred revenue, which relates to payments received in advance of performance under the contract, primarily related to our Premier Agent market-based pricing offering. Such amounts are generally recognized as revenue over the related contractual period. For the three months ended September 30, 2020 and 2019, we recognized revenue of $43.2 million and $34.2 million, respectively, that was included in the deferred revenue balance at the beginning of the related period. For the nine months ended September 30, 2020 and 2019, we recognized revenue of $37.0 million and $31.5 million, respectively, that was included in the deferred revenue balance at the beginning of the related period.

Contract Cost AssetsDuring the three and nine month periods ended September 30, 2020 and 2019, we did not incur any impairment losses to our contract cost assets. We recorded amortization expense related to contract cost assets of $9.5 million and $8.8 million during the three months ended September 30, 2020 and 2019, respectively, and $26.6 million and $26.7 million during the nine months ended September 30, 2020 and 2019, respectively.