Is it time to join a new real estate agency or create your own?

Opinions expressed by Contractor the contributors are theirs.

Congratulations! You’ve had a good year of sales and leases, and it’s almost time to celebrate the annual office party. But you also have some thoughts: maybe you’re considering changing the realtor you’re currently with, or maybe it’s time to steal the nest and start your own. Whatever the case, choosing your second brokerage firm will be a bigger decision than choosing the first.

Why is that?

Everyone in your professional circle knows that you work at this current company. This means that you will have to rebrand yourself with a new one and change all current marketing, customers and potential customers. Neither are quick or inexpensive. Just a new box of quality business cards easily costs $50, so you better think hard before switching licenses.

If the decision is to become a licensed real estate broker, you will need to qualify to take the broker’s exam based on the number of years you have been licensed as an agent and the number of transactions completed during those years. years (it’s based on a point system here in Texas). Then you will need to go through the legal paperwork from the state and local real estate commission to create a legal entity (business), name it, and then pay additional fees for the license and errors and omissions (E&O) insurance.

I’ve been selling real estate for over 18 years in multiple states (Texas, Maryland, and Virginia) and started working at a large, well-known brokerage after getting my license in 2003. I then worked in several other brokerages. , ranging from mid-size desks to one- and two-person desks, and I’ve noticed that there are only four things that really matter when looking to change or create your own.

Related: 6 business models to win with real estate

Breakdown of commissions

When it comes to commissions, more is not always better, but most of the time it is. The higher the commission split, the more money you’ll have for online leads, brand building, buyer concessions, customer dinners, and social media marketing to drive new business. The only downside to a higher spread is the lack of mentorship and support from your broker. If you’re hard-headed like me, you throw caution to the wind and spend that extra club money on Saturday night bottle service to impress your broke friends. Now that I’m older and a little wiser, however, I think the better decision would have been to take a lesser division and gain an available mentor and/or broker instead of feeling like I’m stuck on an island by myself with no one to call for help when a deal went wrong.

Office expenses

Brokerages, especially the big and well-known ones, usually have fancy names for the fees they charge agents as an excuse to take their hard-earned money each month. The term could be ‘office fee’, ‘technology fee’, ‘administrative fee’, etc., and are used by brokers to pay monthly overhead costs, including rent. I consider them absolute rubbish, not least because they deter you (the agent) from spending on more online marketing and leads. At my brokerage, we have no office expenses and we take great pride in that. We keep overhead costs low to allow more flexibility to try new online marketing and prospecting solutions, which means more opportunities to close more deals and help more people.

Related: 63 businesses to start for under $10,000

Marketing

So where does the distribution given to the broker really go? I asked myself this question every time I received a commission check (and the bigger the check, the more I thought about it and the more I resented my broker). Were they giving me leads? How about providing daily social media marketing? Did they have paid graphic design tools that agents could use? Were they helping to improve my brand? (That is, something a lot more than office mugs and pens with the company logo on them.)

Mandatory office meetings

Other than a way to find out what new companies are about to hit the market and network with other agents, I found the mandatory office meetings to be an absolute buzz-fest. Let’s be honest: the best training is training on the job. For example, you might go out and get a contracted house, then run into a problem. What most people don’t realize is that there is always a problem with every real estate transaction. Some are bigger than others, of course, and usually require a variety of solutions, so instead of listening to an hour or two of “sales theory”, it’s far better to reach out to a mentor when a situation arises. At my company, we have optional weekly online training, as well as an optional monthly lunch or happy hour. Agents can reach me between 7 a.m. and 11 p.m. every day, including weekends and holidays. There is also a legal assistance hotline that our commission makes available to answer all questions relating to contract law.

Related: Why meetings are one of the worst business rituals. Never.

Finally, if you are looking to move to a new brokerage, it is essential to know what you are looking for and which brokerages are going to have it. Following your trusted friend into a business just because he or she likes it is not a predictor of a good experience, especially if you end up making sales and they don’t. (It’s your business and your money, not a feel-good story.) So interview at as many companies as you need until you find a good candidate, or do what I did, c ie wait until you qualify to take the brokers exam, then create your own brokerage.