How to grow a real estate brokerage.

Question

We are located in Northwest Indiana.

We are looking to growing our real estate brokerage. Currently we have 7 agents.

We offer high tech lead generating website, software for electronic signatures , no monthly fees and give out leads to agents ( some times - since they are independent) and give a 75% commission split with the opportunity to get 100% cap.

Any suggestions on how to grow our brokerage, attract the right agents and still be competitive?

Thanks BP!

Mike Davis · Answer

@Pamela Joveski before I sold my brokerage, when I started, I found myself trying to compete with the big dogs that had big budgets. My success was going after the more seasoned agents that produced on a regular basis. I provided the office basics (phone, paper, files, etc) and a flat fee of $500/month and 95-100% commission.

The key success in this model is to track expenses...each agent gets a login for printing copies to keep the abuse to a minimum etc. Also, you have to go after the high producing agents where the $500 is a drop in the bucket and you don't have to turn into a debt collecting agency.

All the perks you offer will bring agents, however you don't wan the agents that make one sale and you don't see them until next month. Good Luck!

Robert Carmody · Answer

If targeting new or newer agents, you are competing with other brokerages more on services offered and less on commission splits. You'll probably need to focus on having an effective training program, lead generating system, as well as an opportunity to be mentored or coached. You might want to compare the training offered with competitors and figure a way to put a unique spin on yours or know your value proposition. While new agents can be easier to recruit, especially those that are still in real estate or pre-licensing school, it costs more money to provide good training and to provide them with leads or lead generating systems. They most likely will not have near as much sales production as experienced agents.

On the flip side, if you are wanting to hire experienced agents, they are harder to recruit and usually will be less dependent on the services you offer and more likely to be shopping brokerages based on monthly fees, more competitive commission splits, the opportunity to cap at 100%, fewer or no franchise fees. You might catch their attention by having an in-house transaction coordinator, sign & lockbox delivery for their listings, professional photography for their listings. Their ability to list and sell more houses in your area will help get your brokerages name in front of the market, so any effort or services that let them work more efficiently or that take some of the time-consuming tasks off of their plates can be mutually beneficial. But at the end of the day, you are largely competing on how much of their commission they keep by working with you compared to wherever they work currently.

Kobe Xin · Answer

The first step to attracting the right agents is knowing what the right agent is for your company. Are you looking for seasoned agents only? New agents? etc. There is no one size fits all, for both the agents and the company.

A good starting strategy is to figure out the ideal agent that you want working in your company then figure out what they are missing in their business and offer your company as a way of solving that problem in their business.

Just like any other sales/business, attracting agents to a real estate brokerage starts with solving a problem!

Joe Homs · Answer

@Pamela Joveski just like being an agent, a brokerage needs to attract agents that are interested in working with you?  What do you have to offer?  Offer a niche of working with real estate agents who are investors and work with investors.  Have an $85 a month fee (Just to keep the lights on) and offer 100% commission, but only keep a $850 "Transaction fee." Obviously check fees in your area to be competitive.  Do you have someone with an expertise that is willing to share, ie: Flipper, buy and hold, probates, expired listing, etc. that can be a draw for your company?  Example, create a website that makes it easy for investors and agents to search for flip properties.  Teach your agents how to flip homes and help others do the same.  Advertise on Craigslist about your "Special Niche" and that you are looking for agents that are willing to learn.  Just a few ideas.

Good Investing...