Many agents are in the real estate business with the concept that they will be able to earn a lot of money and will have flexibility in their schedule. Given the dismal pay in the Miami job market and the booming real estate business, a real estate career in the Magic City is indeed very attractive.
Selecting the right broker can make all the difference in an agent’s real estate career, whether the agent is brand new to real estate or looking for a positive change. The right broker choice is not just a choice on where one places his license, but also a choice on what direction right or wrong, the agent takes his first step.
The right match for the agent’s needs, and the agent builds great momentum toward a fruitful career; the wrong one means going sideways for months or years before you figure out what hit you.
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Before embarking on the adventure of finding a new broker, agents need to remind themselves that success typically comes from nuts and bolts: a business plan, leads, mentorship, and by waking up every day and chipping away at their actions.
There are many agents I meet who are one or two years, or even half a decade or more into their real estate career, and they are just floating with no real plan, budget, or idea about where they have been and where they are going. And many are living paycheck to paycheck with no plan for their post-career future. The question is, “Where has the broker been all this time?”
Miami is a city of glitz, glamour and materialism, so it is not unusual for an agent to want to work for the hottest, coolest and sexiest real estate company in town. So they run to what I call the “shiny object” brokerages, the ones that are in the news regularly, have fancy offices, are developer representatives for large condo projects and that have top producers in reality TV shows. They are built to support existing top producers they have or are attempting to recruit. An interested agent should ask themselves, “What will this brokerage do for me on a practical level?”
Brokerages with top producers also attract agents, as many agents have a false sense that they can actually become a top producer by association, or in other words, “success by osmosis.” Certainly the concept of shadowing and mirroring someone who is successful is a tactic that certainly can work, but more often than not the top producer simply does not have the time or skill set to mentor someone in the nuts and bolts of the business.
One thing you can be sure of is that the top producers likely worked very hard to get where they are, and are likely very well-connected. And that’s what any agent will need to do to become successful.
Success typically comes from nuts and bolts: a business plan, leads, mentorship, and by waking up every day and chipping away at their actions.
Commission splits are, of course, an important factor when deciding on a broker, but even for the most money-driven agents, selecting a broker based on splits doesn’t always add up to bigger dollars. As the old saying goes, “100 percent of nothing is still nothing.” Or to be more fair, consider that 70 percent of 12 deals a year earns an agent significantly more than 100 percent of six deals a year.
Broker-produced leads are often on an agent’s mind when looking for a new broker, but it’s important not to rely on these. The brokerage should be willing and able to offer the agent a clear indication of the historic performance of the quantity, quality and type of leads (i.e. buyer, seller, renter, price points, etc) the brokerage offers to its agents. For example, if the brokerage is offering internet leads, the close rate can be 2 percent to 4 percent, or even less. If the broker is suggesting that you may get five leads a month on average, then the agent can expect to close one or two leads per year from his broker’s leads.
Many brokerages also reserve the best and/or most leads for certain agents that are well-connected to the broker or office staff, and there is not a clear system or fair distribution structure for the leads. So it would be wise to ask their policies in that regard. Otherwise, you can be fairly certain that your leads will be from the bottom of the barrel initially or perpetually.
Many agents also overlook the importance of being close to their office. Real estate is an on-the-road sales job, and in a traffic-ridden city like Miami, distance matters when it comes to quality of life and reducing possible burn-out. In this very time-intensive business, minimizing the time sitting in traffic gives agents key minutes or hours to service customers better or get a much needed break in between clients or showings.
With the advent of smaller brokerage offices, conveniences of technology and the trends of agents working from home or at the closest Starbucks, agents think that their brokerage location doesn’t matter much. But if the broker is offering leads, has training or events the agent will be likely want to be closer to the office. It adds up.
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There are certainly substitutes for having a great broker or brokerage. For example, hiring a personal real estate coach is an excellent alternative to a brokerage with good mentorship and training, but a coach does come at a price. For a handful of phone calls a month, the average price for a personal coach is $700 to $1000/month with a one-year commitment.
There is never a substitute for taking the time to make a well-informed decision, and selecting the right broker, despite how easy it is to move your license, shouldn’t be taken lightly.
Sep Niakan is the broker/owner of HB Roswell Realty in Miami, and has been in the real estate industry since 2004 as a top producer.