3 Ways to Identify a Real Estate Brokerage That’s Right for You
by Stuart Neal
on Tuesday, November 24th, 2020 at 11:40am.
1. Large or Small Brokerage?
In my opinion, a big brokerage favours the broker i.e. the broker is only running a large cash flow machine and is simply making money off lots of agents. The larger the brokerage, the more impersonal it is and the more likely you are just going to be a number. It would be natural to assume that the more REALTORS® in the office the more help you might get. The opposite is true. Other REALTORS® in a large brokerage are your competitors. In most cases, you will be left to fend for yourself. It’s the culture of larger brokerages.
A small brokerage on the other hand is likely to have a definite ‘feel’ or culture. In some cases you will be treated ike a partner. If you can find a brokerage that has the right culture and fit for you, this could be a far happier place to work. You may also find that the REALTORS® are more open and collaborative. You are more likely to find help in a smaller brokerage. You are not a number and the broker and other REALTORS® will have more time for you. You are also likely to receive personal and hands on training in a smaller brokerage.
2. Franchised or Independent?
Franchise brands i.e. REMAX, C21, Royal Le Page etc. work on REALTORS® minds in the following way. For example, “I’ve heard of this company therefore it must be a safe choice”. In your first few months, or even years you are far more likely to be working with home buyers, than marketing listings. Research shows that potential home buyers don’t care what brokerage their REALTOR® works with.
Home buyers care about the following things:
Can this person help me find homes?
Did this person show up?
Do I like and trust this person?
If you join a franchise you will have to pay franchise fees. You will also be expected to go out into the world and find your own clients. The training, if any actually exists will be canned and probably out of date. Is it worth it?
If you are hoping to get lots of listings, franchises will argue that you need their brand to have credibility, especially if you are new. This is a fallacy. In the discussion about independents below, we explore in more detail.
An independent brokerage and in particular the smaller boutique brokerage may introduce you to potential home buyer clients, because they have lead generation programs in place. You will be helping to contribute to the distinct culture that is part of a smaller independent boutique.
If you are interested in winning listings, an independent with a strong ‘value proposition’ will help you to stand out as a potential and distinct service provider. With a franchise you risk getting lumped in with everyone else or even excluded, because the seller may already know someone from the franchise you are part of. Home sellers are much more discerning than home buyers when selecting a service provider. It might be wise to be different.
Local independent brokerages is a growing segment in Canada and North America. Perhaps because consumes are seeking an alternative to the bland ‘one size fits all’ franchise model?
3. Solo Practitioner or Team Member?
Are you a collaborator or a lone ranger?
In Canada and the USA, the traditional model has been built around lone rangers. That is single REALTORS® essentially operating a ‘cottage industry business’ under the umbrella of a brokerage. This is fine if you want to own every aspect of the job and if you never want to take a day off.
In most other parts of the world and in Europe in particular, a collaborative team like atmosphere is more normal.
In recent years, the formation of teams has become the second growth element (after local independents). Perhaps its because younger REALTORS® are much more interested in sharing, collaboration and quality of life.
Perhaps its also because consumers are demanding faster, better service and 24/7 attention. And perhaps the only way to meet this demand is by sharing a client with another REALTOR® in some cases, or being able to offer information and service via tech tools, rather than in person.