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RE/MAX Greater Atlanta files bankruptcy!

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Joel Owens Moderator

Real Estate Broker from Canton, Georgia

Apr 12 '11, 12:06 PM


Just came out that RE/MAX Greater Atlanta has filed for bankruptcy protection.

There are stories of the more than 300 agents not getting their commission checks.(checks are already bouncing).The brokerage says earnest money and escrow deposits are safe but who knows.

If you are a buyer or seller with a broker/agent from their firm I would seriously consider not holding any money with them.

http://www.wsbtv.com/news/27524829/detail.html



Medium_allworldrealtyJoel Owens, All World Realty
E-Mail: [email protected]
Telephone: 678-779-2798
Website: http://www.AWcommercial.com
www.AWcommercial.com 678-779-2798 [email protected]


Bryan Hancock

Real Estate Investor from Round Rock, Texas

Apr 12 '11, 12:15 PM
1 vote


Wow! Sign of the times?

Do you know if corporate will cover any of the deficiency? It seems like this would be a huge stain on the brand otherwise.



Medium_inner10_logo__updated_Bryan Hancock, Inner 10 Capital
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Bryan A. Donor

Real Estate Investor from Charlotte, North Carolina

Apr 12 '11, 12:17 PM


yikes...i feel for the agents who earned those commissions...a homebuilder filed bankruptcy in charlotte a few months back..the negotiated settlement is that they're paying off their debts at 10 cents on the dollar...they owed some small business and contractors hundreds of thousands of dollars...i know of a framer who was owed 50k...they're still in business, but paying cash on delivery now...as for the contractors and small businesses, they're screwed



Bryan A., Carolinas Revitalization, LLC
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Bryan Hancock

Real Estate Investor from Round Rock, Texas

Apr 12 '11, 12:18 PM


All sorts of deals are bubbling to the surface now too. I see them via our submission engine every day. The carnage should still take years to play all the way out. Hopefully agents won't get stiffed out of too many commissions in the process.



Medium_inner10_logo__updated_Bryan Hancock, Inner 10 Capital
E-Mail: [email protected]
Telephone: 1-800-577-0401
Website: http://tinyurl.com/inner10invest
Our Recent Austin Business Journal Article - http://tinyurl.com/Inner10Capital


Greg B. Donor

Real Estate Investor from Texas

Apr 12 '11, 12:18 PM


Isn't this JScott's turf? What's going on over there Jason?



Jeffrey K.

Real Estate Investor from Milwaukee, Wisconsin

Apr 12 '11, 01:22 PM
1 vote


I never put EM with agent always with title company. This is a lesson for all of us. I do this because I dont trust agents but this is another reason.



James Hiddle

Wholesaler from Altus, Oklahoma

Apr 12 '11, 01:35 PM


Do you think this will be a trickle effect that will end up happening to other brokerages across the states?



Dale Osborn

Mobile Home Investor from Spanaway, Washington

Apr 12 '11, 05:18 PM


With the age of the internet - I am surprised realtors have been hanging around for as long as they have been. They are a thing of the past and should just fade into the woodwork. More companies should be closing up shop as they profitted from all those losing their homes so what they started may come around to bite them also.



J Scott Moderator Donor

Real Estate Investor from Ellicott City, Maryland

Apr 12 '11, 09:21 PM


Originally posted by Greg B.:
Isn't this JScott's turf? What's going on over there Jason?

I'd say this is more Joel's turf than mine... :D

I hadn't heard this until Joel's post, but we know a LOT of agent from these offices, and I'm hoping to talk to a couple of them today to find out more info. I'm curious if a bunch of agents are going to band together and form a new brokerage, as there are a lot of Re/Max Greater Atlanta agents and many of them are full time.



Medium_lishproplogoJ Scott, Lish Properties, LLC
E-Mail: [email protected]
Website: http://www.123flip.com
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Jeffrey K.

Real Estate Investor from Milwaukee, Wisconsin

Apr 12 '11, 09:52 PM


Does you wife want her own shop Jason?



J Scott Moderator Donor

Real Estate Investor from Ellicott City, Maryland

Apr 12 '11, 10:17 PM


Originally posted by Jeffrey K.:
Does you wife want her own shop Jason?

She's talked about it for a couple years now, but ultimately, I doubt she'd ever seriously consider it, unless there was a special niche where she thought she'd have a competitive advantage over the bulk of the other brokerages out there.

Running some preliminary numbers, it appears that for residential brokerages, if you can't scale to at least a couple dozen agents, it ends up being a low-paying job with a lot of management responsibility, overhead and headaches.

Plus, she's still 6 months from being able to get her broker's license.

This is probably something I'd consider doing (with an investing niche), but I'm still at least 3 years from getting my broker's license... :D

Joel - Didn't you use to have a bunch of agents working for you? What was your experience?



Medium_lishproplogoJ Scott, Lish Properties, LLC
E-Mail: [email protected]
Website: http://www.123flip.com
CHECK OUT MY BIGGERPOCKETS BOOKS: http://www.biggerpockets.com/flippingbook


Joel Owens Moderator

Real Estate Broker from Canton, Georgia

Apr 13 '11, 02:58 AM
3 votes


I started out at Metro Brokers then went to Solid Source.Have had my own brokerage since 2007.

Originally when I saw Michelle's success from 45 agents to thousands I thought I could do the same thing but doing a virtual brokerage to keep costs low and not have brick and mortar costs (leasing or owning a building) for agents to use.

I spent about 5 months recruiting and was up to about 50 agents charging a 300 per transaction fee with no dues and FMLS only access. GAMLS you have to pay an ongoing fee for instead of when a sale occurs like FMLS.

With FMLS you still have to hit yearly minimum brokerage sales numbers or get hit with a big fee.

What I learned from that experience is that many agents have a sense of entitlement.I would find that maybe only 20% to 30% of the agents would have a closing that month.

So to scale this if I had 100 agents you might have 6,000 to 9,000 a month gross coming in.

For that though it is a major headache.Many agents are part-time and rusty or an investor wants to run a hair brained scheme.My favorite is a new agent that just left a 50/50 brokerage that has almost zero training and wants to join my firm.

They would want you to train them and spend hours and hours for a 300 trans fee.I am not even mentioning the amount of paperwork you have.

Agents not keeping up with education requirements,not paying license fees and getting a lapsed license,getting a suspended license for child support, government loans,etc.

Getting IRS orders to take any commission your agent gets and pay to them etc.

I now have about 18 agents and haven't taken anymore for over a year.I do way better and make more working my own deals.Paperwork and headaches are less and I don't babysit have to constantly watch agents anymore.

I would say it's good to have the brokerage license just don't add any agents unless you keep it small and they agree to a fat commission split for your time invested.

If they him and haw kick them to the curb!!

The 100% model everyone and their brother is doing it today in Atlanta.I see stuff for 150.00 a transaction now.It's saturated and there just isn't the money in it now that used to be.

Hope it helps.



Medium_allworldrealtyJoel Owens, All World Realty
E-Mail: [email protected]
Telephone: 678-779-2798
Website: http://www.AWcommercial.com
www.AWcommercial.com 678-779-2798 [email protected]


J Scott Moderator Donor

Real Estate Investor from Ellicott City, Maryland

Apr 13 '11, 03:59 AM


Joel,

Great, great info...thank you so much for that!

Pretty much exactly what I imagined, but great to hear it first-hand...

By the way, if you're charging a larger commission split these days, what is motivating those 18 agents that are currently with you to stay, as opposed to going to a solid source or small-time broker with a very small commission split?

Thanks!!!



Medium_lishproplogoJ Scott, Lish Properties, LLC
E-Mail: [email protected]
Website: http://www.123flip.com
CHECK OUT MY BIGGERPOCKETS BOOKS: http://www.biggerpockets.com/flippingbook


Joel Owens Moderator

Real Estate Broker from Canton, Georgia

Apr 13 '11, 04:31 AM


Some of these agents aren't closing anything and I am fixing to clear them out again down to about seven or eight.

The ones that do close transactions have been with me for awhile and are trained for the most part.They pay the 300 trans fee for residential transactions so I don't have to put much time into them.

On commercial transactions they would have to sign an agreement with me for a 60/40 or 50/50 split to do those.

So the ones I have now are pretty much on auto pilot but I still look over paperwork.



Medium_allworldrealtyJoel Owens, All World Realty
E-Mail: [email protected]
Telephone: 678-779-2798
Website: http://www.AWcommercial.com
www.AWcommercial.com 678-779-2798 [email protected]


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