Does it really matter where you hang your real estate license? We hear this question all the time, and there are as many opinions on this topic as there are brokerage models.
Some will say it doesn’t matter what brokerage you select to partner with because customers hire the agent not the company, right? That might sound good at first. However, when you dig a little deeper, you’ll see that where you hang your license and what brokerage you choose to partner with can determine a lot — like, where your real estate career goes, what kind of business you will do, what price ranges you will work in, if you are going to be successful and in some cases, if you will even stay in the business.
The agent’s skills and work habits are key to success, but the piece that the brokerage contributes to your business can really be significant. To illustrate this point, let’s take a look at two scenarios.
Scenario No. 1
Let’s say that you have a listing appointment, and the sellers will be interviewing two agents to list their property. The first agent is dynamic, experienced and works for a little local brokerage. The second agent is also dynamic, experienced and works for a big, full-service brokerage.
The first agent goes into the listing appointment and spends the first 30 minutes explaining to the sellers what their brokerage is and then offers MLS exposure and open houses on Sunday.
When the second agent with the big brokerage goes in, there won’t be any need to sell the company — everyone knows what it is. This agent very specifically demonstrates to the seller a complete, multimedia global marketing plan that will be implemented right away.
Agents with the second brokerage can do this because their company subsidizes the marketing plan. They can afford to do this on day one.
They both charge a 6 percent fee. Who wins the listing?
Scenario No. 2
Let’s look at two new-to-business agents with similar skills and experience in the business. Agent No. 1 goes with a small brokerage where the broker sells real estate, competes with the agent and is hard to reach because he is out selling real estate. This brokerage offers minimal training and support, but the split is 95 percent. This agent is excited and can’t believe he got such a great split.
Fast forward 12 months, and this agent has done one rental and is looking for part-time work because real estate is “slow.” It real estate truly slow, or is this agent in the wrong place?
There are many talented people out there who have given up on real estate simply because nobody ever showed them how to be successful. Mistakenly, these agents thought real estate was not for them.
Agent No. 2 goes with a large brokerage where the broker does not sell real estate. The company offers a lot of training and support, focusing on growing its agents’ businesses. (Remember that when you take your real estate exam, they don’t teach you how to sell real estate. As a new agent, you can only get this from where you hang your license.)
This brokerage also offers leads, lots of tools and a great, positive culture with a really nice office full of top-producing agents. This agent can sit open houses that some of the top producers in the office don’t want to do, and gets help navigating those first deals.
The broker is only a phone call away whenever assistance is needed. Fast forward 12 months, and this agent has already done seven deals and can’t believe how busy real estate is.
The brokerage you choose matters
When we look at these two examples, we see that taking all your personal skills and partnering up with a company that brings a lot to the table can really take your business to the next level.
One thing remains true, and it’s this: If you want to be a really big agent, you have to partner with a big company with resources that are going to contribute to the growth of your business. Are there exceptions to this? Yes, but most of the time, you will find this to be very true.
The best thing that you can do — whether you are just starting out in your real estate career or if you have been in it for a while — is to look around and interview several brokers. There are many different models, each offering different perks.
Some of these things are critical to your success. Here are some key things to ask the broker during your interview:
- What kind of training and support do you offer? How much does it cost?
- Do you spend your time supporting your agents, or do you sell real estate?
- Can I reach you seven days a week if I need help with a transaction?
- What is the per-person production of your office? How many deals does each person in your office do per year?
- How many agents are on your roster, and how many made zero dollars in the last twelve months? (When this number is high, you can bet there is not a lot of good training and support at this brokerage.)
At the end of the day, a good agent can be good anywhere. However, the decision of where you hang your license can determine if you are just going to be good or if you are going to take your business to another level and maximize your profit and potential.
Many agents are content where they are, and aren’t really aware what else is out there and what they may be losing. Who you decide to partner with is a much bigger decision than it appears.
Rather than just go to a place a friend recommends, really take the time to research the brokerages in your area, ask good questions so that you make sure you land at the best place for you and your career. This will save you a lot of time and money and keep you from jumping around. For many, it may be the deciding factor if they’re are going to make it in real estate.
Joseph Santini is a managing broker at Coldwell Banker Residential Real Estate in Boca Raton, Highland Beach, Delray Beach in Florida. Connect with him on LinkedIn.
