January 31, 2020

Choosing a Broker: How to Find Your Best Match

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How to choose real estate broker 

Choosing the right broker is a necessary step in every agent’s career. The state of Texas requires all individuals who hold an agent’s license to have a sponsoring agent. This must be registered with the Texas Real Estate Commission. If an agent is not sponsored by a broker, his or her license will be deemed inactive and he or she will not be permitted to earn commission from any sales they facilitate.

Choosing the right broker can be an ever-changing process. According to the National Association of Realtors, the median tenure for REALTORS® with their current firm was four years. There are many reasons agents decide to leave their brokers for another. In order to spare you the headache of making the wrong choice, we will explore the most important factors you need to consider.

So, how do you choose the right real estate broker?

Count the Costs Charged by Various Brokerage Agencies

Although choosing your new real estate broker should not be solely based on costs, it’s a good place to start. Every broker will have a charge or fee structure; it’s important that you understand how they work and what it means for your bottom-line.

Flat Fee Brokers

To be more appealing to agents and clients, many real estate brokerages, have abandoned the percentage-based commission schedule. They have, instead, opted to charge a flat fee on every transaction. No matter how big or small your transaction may be, you will, in most cases, pay the same amount of commission. This is especially appealing if you plan to try your hand at high dollar sales. If you, however, intend to sell value to lower-priced properties, this may not be the best fit for you.

Commission-free Brokers

There are agencies that entice agents by advertising that you can keep 100% of your commissions. This may seem too good to be true, but when you get into the monthly expenses, you may find that it’s not. These firms typically assess a monthly fee to each agent. The cost of these monthly or “sponsorship” fees range per company, but agents will pay them each month whether they are actively selling properties or not.

Commission Split Brokers

The most common real estate fee structure is the commission split. In the commission split, the sponsoring broker receives the commission payments and splits the money with the agent(s) who facilitated the transaction. The most popular split fee models range from 60/40 to 70/30 in favor of the agent(s).

Ask about their Coaching and Training Programs

As a new agent, it will be crucial for you to have proper support in the beginning of your business. You are well-equipped in education, but experience will be your best teacher. A good sponsoring agent will provide a lot of guidance as you learn and grow your business. Beware, some agencies are still committed to old tried and true methods of getting new business; this can sometimes mean they aren’t helping you to develop your business online due to a preference for traditional marketing.

Research Company Culture

Before finding the right broker, you’ve got to know what’s important to you. Consider things like how much support you want, how closely would you like to work with other staff, and how much freedom you want to do business your way. To find out if an agency is a good choice for you, talk to other agents at the firm and attend company events. Being in their corporate environment with other staff will let you know if that agency could be a good fit.

Choose Between Franchise and Independent Agencies

Another choice you will have to make is whether to join a franchise or independent brokerage. 53% of Realtors are sponsored by independent agencies. (NAR) It will be most helpful to evaluate the pros and cons of each before deciding which way you should go.

Working with Independent Agencies: The Pros & Cons

Independent agencies are non-franchised. These are often your “mom & pop” brokerage houses.


  • -Fewer agents
  • -More hands-on support and training for new agents
  • -Agents have more freedom to build their businesses their way
  • -Leave room for agents to brand themselves
  • -Personal, family-like company culture
  • -Local market share - excellent if agents want to establish in the same geographic area as the agency


  • -Less name recognition
  • -Fewer resources
  • -Lower budgets for marketing are likely
  • -Local - not a great fit for agents who want a broader scope

Working with Franchise Agencies: The Pros & Cons


  • -Big name recognition (e.g. RE/MAX, Coldwell Banker, Keller Williams)
  • -Established Branding
  • -Effective processes and systems in place
  • -Corporate mentorship programs


  • -Expensive - franchise fees often passed down to agents
  • -Little to no opportunity for agents to build their own brands
  • -Corporate disconnect from local trends and culture

Locate an Agency with a Niche That Matches Your Own

To be a successful agent, remain focused on building your own brand. Even when choosing your sponsoring broker, you have to consider what will work best to help you on your mission to brand yourself. The most successful agents are known as local experts; that’s a big part of developing a niche.
Let’s say, for example, your goal is to be the best agent in Katy, Texas. Perform a google search similar to one your potential clients do at the beginning of their property search. Type in “homes for sale in Katy, Texas,” and scan the results to determine which brokerages appear to have a market share in Katy.  This can help you narrow down your search for the right broker.

Why it’s Important to Choose the Right Real Estate Broker

From the very beginning of your real estate business, you should be focused on your individual goals as an agent. Being mindful of how you want to brand yourself, which niches you’d like to develop, and how much support you want to receive are key considerations. Use the tips we have given you here and the advice of seasoned local agents to find your best match.

MSDS Entrepreneurs is committed to helping real estate agents sell more houses. For a complete look at the services we provide.

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