Broker: Not a Boss, But a Booster
As a realtor, you have both added freedom and added responsibility. Your business is your business, but it’s your business.
Still, working for yourself doesn’t mean working alone. Unless you choose to earn an additional broker’s license and work completely independently, you’ll almost certainly be working under a broker at an agency.
That being said, just because you can hang your license anywhere doesn’t mean you should. Before committing to a broker, you’ll want to make sure you have the right fit.
Best Form, Best Fame
Start by doing some research on the company’s earnings. Clearly, it’s important that your agency be profitable—but how successful are they in your niche? If you find you work primarily with buyers, an agency made up of seller’s agents probably won’t help you; if you’re most comfortable selling to middle-class families, an agency with primarily high-end listings may not be the right place.
In choosing a broker, as in cultivating your personal relationships, visibility and reputation are also crucial. If you’re going to tie yourself to an agency, you want to make sure they’re going to help you get noticed and gain clients’ trust, particularly when you don’t have many contacts of your own. The most profitable agency in your region may have a reputation for being full of shysters and snake-oil salesmen.
A big, international franchise may sound like the ticket for a new agent, and in many cases this is true. Century 21, Coldwell Banker, Keller Williams — they offer huge professional networks, brand recognition, and highly organized support systems. Before you jump on the bandwagon, however, you have to do some thinking about your customer base. That is, people in your area may be more comfortable and more experienced in dealing with local, family-owned establishments.
Another reason plenty of real estate brokers don’t opt into a major chain: they’re expensive. Franchises can charge local thousands of dollars as an initiation fee. They can also charge renewal fees and get additional income by marking up “business and promotional items.” Plus, most franchises take an additional percentage of every commission sellers pay. All of these costs will affect your bottom line as an agent.
Furthermore, depending on where you are, a big name may not amount to much at all. That is, RE/MAX may have offices in 82 countries, but if everyone in a twenty-mile radius knows “Big” Jim Sullivan at Sullivan Realty, you’d probably be better off with him.
Finally, it’s important to get a sense of the nuts and bolts of working at an agency. The best way to do this is by talking to other agents. Try to meet with as many as you can from the agencies you’re considering. Ask about commission splits, technology, administrative support, and advertising.
Next, try to get a sense of the overall culture. Is the lead broker an egomaniac with a temper? Is he interested in expanding the business, or apathetic? Is the dynamic among agents competitive or collaborative? How does this match up with your philosophy? Align yourself with the agency that is going to support your success.