Selecting a 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 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.
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.
-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
-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)
-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 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, visit our Realtor Solutions page.
Best Practices for Voice Search SEO
Why Your Business Needs Voice Search SEO
Like mobile-devices, voice search is here to stay! Voice search is a speech recognition technology that allows you to voice-command the search engines.
Voice search and/or mobile assistants are becoming increasingly popular even among younger generations. Voice search is growing in popularity for a variety of reasons. It's a faster and easier way to s... more
The Benefits of Personalized Marketing
Why Your Business Needs Personalized Marketing
Imagine a day in the life of the customer: They can hardly turn on their computers without getting bombarded with advertisements, requests, offerings, promotions and more. They are overwhelmed, irritated, and lost. As a business owner, you don't want to lose them. This is where personalized marketing comes into play.
Personalized marke... more
Artificial Intelligence and Small Businesses
Artificial Intelligence and Small Businesses Work Together!
Artificial Intelligence (AI) is made to help humans perform our jobs better. While AI has been a source of inspiration for Sci-Fi and Horror films, AI is a practical and informative tool that can work to a small business owner's advantage.
AI and small businesses help each other evolve. No matter your business's industry o... more
Customer Service Tactics 2020: How to Build a Facebook Chatbot
Why You Should Build a Facebook Chatbot for Your Business
As you might have heard, Artificial Intelligence is taking over the marketing world. Chatbots and other communication tools help customers find what they're looking for while shopping online. There are many benefits to different types of chatbots, and the Facebook Chatbot is a great place to start. We'll show you how to build a... more
Marketing Funnels for Small Businesses Explained
Everything You Need to Know about Marketing Funnels for Small Businesses
As you know, conversions turn website visitors into customers. Conversion rate optimization or CRO is a very important part of marketing because it has the power to increase your revenue. One way to increase your revenue is to use marketing funnels.
Marketing funnels or sales funnels are another visualizati... more
Conversational Marketing 101: Chat and Messaging
Use Chat and Messaging to your advantage with conversational marketing
Conversational marketing is a new and personal approach to interacting with customers online. Remember the simple days of, "You've got Mail?" Flash forward to 2020, and your expertly-crafted email goes unnoticed in the overloaded inboxes of customers and business professionals. There has to be a quicker way to inte... more
What is A-B Testing and How Does it Help Small Businesses?
What is A-B Testing and Why do You Need it?
At MSDS Entrepreneurs, we care about web development and inbound marketing strategies that help your business get results. A-B testing, also known as "bucket testing" compares two versions of a webpage to see which one performs better. It's not as complicated as it sounds. Here we'll answer 1. what is A-B testing? and 2. How you and your ... more
Are Zillow Agent Websites a Smart Investment?
Zillow is a dominant online real estate platform. Zillow.com is frequently visited by approximately 36 million visitors per month! Due to its enormous popularity, it launched Zillow Premier Agent Websites, giving local agents an easy way to create their own websites. In this digital age of real estate, agents must have websites, but more importantly, the websites must be effective. They need to be... more
Why 8 Out of 10 Real Estate Agents Fail & How To Avoid the Pitfalls
Several scary statistics loom on the internet regarding the extremely high failure rate of real estate agents. The rate at which agents quit varies, depending on the source, but the overwhelming average tells us that every 8 out of 10 real estate agents will walk away from the business within their first five years. If you are considering a career in real estate or are an active agent within your ... more
Building your Real Estate Business with Strategic Partnerships (Part II)
In Part One of this series, we discussed the criteria that defines what makes an individual or company a good partner. In review, to be considered a well-matched partner, each business should meet the following criteria:
1. They are non-competing
2. They share the same target audience
3. They have a good reputation
Weighing in the three factors mentioned above, we moved into iden... more
Building your Real Estate Business with Strategic Partnerships (Part I)
Building your Real Estate Business Part I
No man is an island, especially in the real estate profession. To give your real estate business the best chance to thrive, put some time and consideration into building your network with strategic partnerships. To do this effectively, you have to remember that this is a strategic plan. Building a strong network can lead to a boost in referrals and... more
Choosing a Broker: How to Find Your Best Match
Selecting a 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 facilitat... more
How to Become a SUCCESSFUL Real Estate Agent in Texas
A Guide for Budding Entrepreneurs
If you want to be a rockstar agent, this guide is for you! We will take you through the entire process of becoming a licensed agent and give you sound steps to successfully launch your career.
No matter where in Texas you live, all aspiring real estate agents must take the required steps to obtain their agent license from Texas Real Estate Commission (TREC).... more
Connect with New Clients:4 Effective Digital Market Tools for Realtors
Experienced real estate agents know that word of mouth referrals is one of the best ways to get new clients. However, the growth in technology and its increased mobility is changing the way buyers & sellers are looking for properties & agents. According to the National Association of Realtors’ most recent report on Real Estate in a Digital Age, 98% of Older Millennials, 89% of Older Boom... more
Post Views: 2
Sign up to receive our blogs packed with new ideas, market insights, and inspiration to grow your business right in your inbox