Agents Do You Prefer Large Brand Name or Small Boutique Brokerage
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
District Invest Group545 Reviews
Agents Do You Prefer Large Brand Name or Small Boutique Brokerage
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Lisa KohlPro Member
REI Pro · Boise, ID · Member since 2014 · 380 posts · 93 votesIf a majority of your business is retail and you're a newer agent then a brand name may be worth investing in. However if you already have systems in play for marketing etc and you don't require much coaching then flat fee is the way to go.
My beginning as an agent was closing my own deals and throughout that I have built a solid investor client base as well as promoting my brand. So for me personally- small is the way to go without parting with commission dollars.
21 Replies
- 11yCurt DavisBusiness MemberFlipper/Rehabber · Memphis, TN · Member since 2008 · 5k+ posts · 2k+ votes
Since most of my business is investor transactions I am currently with a boutique brokerage that allows me to pay a flat monthly amount and then I keep 100% of my commissions. No if my business ever shifts to doing more normal retail with normal buyers and sellers then I could see or consider going with a larger brand.
Curt Davis - KAIZEN Realty538 Reviews - 11yLisa KohlPro MemberREI Pro · Boise, ID · Member since 2014 · 380 posts · 93 votes
If a majority of your business is retail and you're a newer agent then a brand name may be worth investing in. However if you already have systems in play for marketing etc and you don't require much coaching then flat fee is the way to go.
My beginning as an agent was closing my own deals and throughout that I have built a solid investor client base as well as promoting my brand. So for me personally- small is the way to go without parting with commission dollars.
- Residential Real Estate Broker · La Crosse, WI · Member since 2013 · 360 posts · 110 votes11y
I am with a large franchise. It does no advertising and I do my own marketing and pay all my own expenses. The only thing the office does for me is review paperwork and cut checks. I'm thinking of going out on my own.
- Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes11y
I have the same feelings as @Curt Davis on this topic. Since right now I work mostly with new/experienced investor buyers up here in Connecticut I like the flexibility that a small brokerage gives me.
With that said, if being a realtor was my main source of income and my livelihood depended on it there is a lot of value to joining a bigger brokerage with more of a brand name.
- China, ME · Member since 2014 · 3k+ posts · 4k+ votes11y
I was with a large franchise for a while. It was good training when I was a new agent, but the splits were not great - 55.2% for my own leads, 29.9% for company generated leads.
Worse, the promised training was weak. There was no organized curriculum at all. Questions were often referred to online videos, when some real live guidance was needed. Heck, I did my first listing presentation without ever being trained on it or seeing one done - and with no training in running comps either. (I did get the listing and had it under agreement within 10 days!)
I found a coach who had the skills I needed to learn and pay him handsomely for his support. With his guidance, I generated more buyer leads in 10 days than I had in the previous 10 months with the big franchise.
Now, I'm within a week of opening a new brokerage. I'll take the good from the franchise experience and eliminate the bad.
Low friction for agents, strong splits, intense focus on high volume lead generation for agents and follow-up accountability. I think that's a formula for success.
I reserve the right to be wrong, but I'm not sure that's something you'll find in a big franchise.
- Investor · Sherman Oaks, CA · Member since 2008 · 6k+ posts · 3k+ votes11y
Should you hang your license at a small boutique realty firm or a big-named brand?
If you're doing transactions in your own LLC name as an investor and business owner and not "acting agent for" you will do a lot better with the boutique firm.
Let's say that you wanted to do lease-option assignments on pretty houses with little equity say 5%.
If you're listed agent with Keller Williams or Caldwell Banker or Remax, you're probably going to not even pitch the listing of 5% equity.Why? Because we too much for the costs to sell, like 10% of value, so a seller that has only 5% equity has to pay to get rid of a house
Most brokers don't like the idea of lease-option assignments or sub 2 - fix and flip or wrap purchase.
Their EAndO (errors and omission insurance) only covers straight listing agreements.
No matter what you tell them, they have a corporate structure, their own legal dept, and they don't like any creative transactions PERIOD.
If you want to do creative transactions like subject to, lease option assignments, wraparound mortgages, and you want to "act as a principal and not an agent", I would find a boutique firm and a flat rate fee.
You can always go lawsuit insurance on top of your EandO
See your insurance broker for business liability insurance
There's so many deals but just don't work with a straight listing
And I can make a lot more money by doing a lease option assignment or a wrap or subject to - fix and flip compared with getting 1.5% of a gross sale - Lender · Greater LA/Orange County area, CA · Member since 2012 · 3k+ posts · 3k+ votes11y
If you want the flexibility to do lots of creative transactions, then a small brokerage is the way to go.
The great thing about working for a smart brokerage like KW is that they have a great reputation for street cred, training, employee moral and marketing savvy and synergy. The trade off is restrictive policies that encourages form-driven transactions and discourages other activities that fall outside mainstream retain sale listings and closing. Much easier for them to supervise (and insure for E & O).
Personally, I do not have the attention span to do the same kind of deal over-and-over, hence my attraction to probate, deceased and missing owner transactions. There may be similarities in certain transactions (loan, facts and circumstances, litigation, etc.) however no two are ever alike. For me, that beats "another listing" hands down.
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@Russell Brazil this is a great question... and you have both opinions expressed above.. IE some take no value from the big company and do it all themselves ,, others take value in that they get business because of the brand.
Then you have others who are in the investor or turnkey space and large company does not help at all its all about lowering their splits.
I know when I had my smaller brokerages 50 to 70 agents... its was VERY difficult to get a top producer from KW RE C21 etc to jump over just for a better commission split.. most of these agents were making 500k plus and the difference between 35k at KW and 12 K at my office was not enough to get them to move and rebrand themselves.
I did some some top producer band together and start their own firms though. And that is were I currently hang my shingle a small boutique 35 agents.. but the owners 4 or 5 of them are all top producers and builder developers in their own right ...
For me running the brokerage was just a free place to work and what I personally got out of it was LEADS and deals that were off market and brought to me by my agents that was the true financial benefit for me to herd those cats.
- San Francisco, CA · Member since 2015 · 786 posts · 717 votes11y
My perspective is a little different from the posts on here. If your an agent, are you running it in the S-quadrant or B-quadrant? I never wanted to be a realtor but a run a realtor business. I never wanted to be a wholesaler but run a wholesaler business. I also never wanted to be a flipper but run a flipping business.
I have my license at Keller Williams because they teach you how to run a business that runs itself. We sold 152 houses last year and I never once personally worked with a client. Keller Williams is also awesome for high level networking with top agents and teams across the country.
Now that's the positive with Keller Williams. Here is the negative. Keller Williams wants you to only follow their MREA model and the model typically only works if you want to be a traditional realtor. They don't like it when you try to build your own mini-brokerage of 30 to 40 agents. Politically, I have experienced sabotage after sabotage over building a bigger team. One of the reasons I joined Keller Williams was that I saw a benefit that they could recruit for my team. They don't like it when you take too many recruits from them and so over the last year and a half I've recruited everyone myself. If you join Keller Williams, the point is to make money. There seems to be real jealousies and envy if you make a lot of money as a non-realtor.
Keller Williams despite publishing three awesome investment books Flip, Hold and the Millionaire Real Estate Investor is not friendly for investment-minded people. They feel like being known as the off-market hub is taking money out of their pockets.
In summary, I think Keller Williams is a great place to start. Learn the systems to how to build a team and make valuable connections. At Keller Williams, they let you build your own brand and now I can easily go off on my own as we have a solid brand. Vest your profit share after three years and then find a 100% boutique shop that will let you keep your own brand. I don't think Keller Williams is a fit for people who do investments like discussed on BiggerPockets.
- San Francisco, CA · Member since 2015 · 786 posts · 717 votes11y
Originally posted by @Jay Hinrichs:
@Russell Brazil this is a great question... and you have both opinions expressed above.. IE some take no value from the big company and do it all themselves ,, others take value in that they get business because of the brand.
Then you have others who are in the investor or turnkey space and large company does not help at all its all about lowering their splits.
I know when I had my smaller brokerages 50 to 70 agents... its was VERY difficult to get a top producer from KW RE C21 etc to jump over just for a better commission split.. most of these agents were making 500k plus and the difference between 35k at KW and 12 K at my office was not enough to get them to move and rebrand themselves.
I did some some top producer band together and start their own firms though. And that is were I currently hang my shingle a small boutique 35 agents.. but the owners 4 or 5 of them are all top producers and builder developers in their own right ...
For me running the brokerage was just a free place to work and what I personally got out of it was LEADS and deals that were off market and brought to me by my agents that was the true financial benefit for me to herd those cats.
I agree that the purpose of having a realtor brokerage is to generate leads and investment opportunity. To do that, you want to have 40 to 100 agents. When I built that at Keller Williams, they were working hard to prevent me from building a team that big. At that point, you would normally buy in as an owner but for me that really did not make sense financially or politically.
The only thing I don't like about having my own brokerage is the liability if it is an investor friendly brokerage. I am looking for a 100% boutique brokerage that will essentially let me take it over and get flat fees per transaction. If anyone knows a 100% shop that would let an established brand take over for a per transaction fee, please let me know.
- 11yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@Ryland Taniguchi I kind of kick myself I had the opp. to buy all the Keller Williams offices in the PDX metro area I think if I remember correctly I could have had them all for 60k... oh well. you should be able to find what you seek
- Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes11y
I went through different ways of doing things early on. 12 years in I have settled on this model for myself and enjoy it.
I have been the principal broker and owner of my company for a long time. I used to have agents way back when but got rid of them.
These days I work directly with clients one on one, buy my own investments directly, and look to syndicate deals as a sponsor when it makes sense for me ( lot's of equity upside not just cash flow being a manager). I only do commercial real estate.
I get asked to take back on agents. I have no interest in doing that. Agents want to take up your time and knowledge saying they want to learn the business and then have false promises and waste your time.
My response is give me 25,000 upfront non-refundable and be on a 50/50 split to join. When you close your first deal then you will have already paid the 25,000 on a 50k commission deal so would in that example get all of it. If you are lazy and quit you have lost 25,000 with nobody to blame but yourself with your excuses.
Some of my other broker friends love to babysit agents for a low transaction fee on the residential side. They make a decent living but it is not anything I am interested in. If they do 350 transactions with agents at 300 fee a pop they have made about as much as I do average on one commercial deal. Actually when they factor in their overhead costs to subtract probably closer to 400 deals at 300 fee.
You either like doing that kind of thing or you don't. I love my life now. It's great when you figure out exactly what you want and what you don't for ultimate clarity. Find your path to gain ultimate clarity and only do that.
A syndicator I know uses an analogy of "chasing rabbits". People constantly do a little bit of this and that that they go around in circles not getting anywhere. Getting very specific on what you want to do. Everyone I have know it's not about what brokerage you belong to but what YOU do that creates success.
- Real Estate Agent · Kansas City, MO · Member since 2015 · 30 posts · 18 votes11y
I just had to make this very decision and I decided to go with a bigger name brokerage that offers a 100% commission split. As a new agent, I determined that the training and support I would receive at the larger brokerage would be more beneficial to my career. The downside is a substantially larger monthly obligation than the transaction fee brokerage I was interviewing.
@Joel Owens I love the idea of getting very specific on what you want to do. That is something I have been struggling with. There are so many different paths in real estate it is easy to get sidetracked.
- Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes11y
Drew the first 1 to 2 years generally agents are in experimentation mode. They try out a few things and say I can't stand this or a I loved this type of transaction.
Once you find out a specific niche you have great joy in then align with a brokerage focused on that path.
- Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes11y
Having been at a small and a large brokerage, for me personally the benefits of being in a large brand name have really helped me. In the DC area, the median home value is pretty high, so I am going to make considerably more off of a standard residential sale than from something like wholesaling a property. When I went to a large brand name, I bet I doubled the amount of transactions I was doing, and also was doing them on higher priced properties.
Since my investing side of my business is primarily buy and hold, with a few fix and flips that are out of state, the restrictions a big brokerage places on me do not have much affect.
I also wonder then now that I am thinking about it, is perhaps part of the difference on what is better, have a bit to do with the price of the properties in your area. If I were servicing an area where the median home value was $100k, and Im going to have to split a $2500-$3000 commission with a broker, maybe I would need to be in a place that allowed me a more creative way to make money. But DC has a median home value of $550k, so when you make a commission it is a nice chunk of change even with a worse commission split and the restrictions they place on you.
District Invest Group545 Reviews - Investor · Sherman Oaks, CA · Member since 2008 · 6k+ posts · 3k+ votes11y
I am in Sherman oaks ca median of $900k :)
Yes numbers work well here for commission only but few can afford the mortgage
- Real Estate Investor · GA · Member since 2015 · 59 posts · 33 votes11y
@Russell Brazil I agree with most of the folks about the differences between going with a small brokerage and a large one.
I think the decision, ultimately, comes down to a personal analysis of where you are and where you are trying to go.
If you would like to have the freedom of doing creative investment deals as @Rick H. said, I'm in it to build a business. Running around hand holding buyers, was not the end goal for me. I wanted to be somewhere that I could use my strengths of marketing, building a team, and an investment company.
My current brokerage is the largest I have been with. They are still flexible and run like a small family, but is growing rapidly now in 29 states and publicly traded on the stock market. To me, it was a blessing to find everything I wanted in one place. 80/20 split with cap, agents receive stock ownership, team revenue share, responses from mentors in 1-2hrs, the most innovative marketing tools I've ever used and all for $50/month. I can even hang my broker license there and build it within if I decide to. Haven't experienced anything like it.
My advise it to find a company that fits your personal short term/ long term goals. When you know yourself, your strengths, and your passions you begin to make things line up with that.
- Northern, CA · Member since 2014 · 674 posts · 444 votes11y
I'm a new agent, just got my license 2 weeks ago. I had spoke with a Broker from one of the big names and thought we had an agreement that I would be allowed to invest and be an agent. Investing is #1 goal with being an Agent #2, anything I make off a listing will be put into the investing business. However, when the broker talked with an attorney from CAR right as I was signing on, the broker got cold feet.
I've now signed on with a flat fee broker. I'm a bit concerned because i'm new and have a lot to learn but I am doing a mentorship with split commission on a set number of deals to start, commission is the same as I would have had at big broker for all deals. The flat fee broker has no concerns with investing, they have focused on this exact issue so it's not an issue for their agents.
I think I may be happier how this worked out, I'm more the loan wolf type and this allows me to run my own business out of my house which was my goal anyways. Time will tell.
- Specialist · Westlake Village, CA · Member since 2010 · 1k+ posts · 781 votes11y
I am with a wonderful KW office in Southern California. KW is much more forward thinking than many other large brokerages. Although, a boutique would offer a greater amount of flexibility I enjoy the affiliation with a large company.
Funny story, I once had a conversation with a compliance officer from a large brokerage who informed me that I was restricted to acquiring 2 investment properties per year for my own portfolio. I smiled & nodded. Some things just have to be ignored.
- Real Estate Agent · Los Angeles, CA · Member since 2015 · 109 posts · 43 votes9y
Originally posted by @Ryland Taniguchi:
My perspective is a little different from the posts on here. If your an agent, are you running it in the S-quadrant or B-quadrant? I never wanted to be a realtor but a run a realtor business. I never wanted to be a wholesaler but run a wholesaler business. I also never wanted to be a flipper but run a flipping business.
I have my license at Keller Williams because they teach you how to run a business that runs itself. We sold 152 houses last year and I never once personally worked with a client. Keller Williams is also awesome for high level networking with top agents and teams across the country.
Now that's the positive with Keller Williams. Here is the negative. Keller Williams wants you to only follow their MREA model and the model typically only works if you want to be a traditional realtor. They don't like it when you try to build your own mini-brokerage of 30 to 40 agents. Politically, I have experienced sabotage after sabotage over building a bigger team. One of the reasons I joined Keller Williams was that I saw a benefit that they could recruit for my team. They don't like it when you take too many recruits from them and so over the last year and a half I've recruited everyone myself. If you join Keller Williams, the point is to make money. There seems to be real jealousies and envy if you make a lot of money as a non-realtor.
Keller Williams despite publishing three awesome investment books Flip, Hold and the Millionaire Real Estate Investor is not friendly for investment-minded people. They feel like being known as the off-market hub is taking money out of their pockets.
In summary, I think Keller Williams is a great place to start. Learn the systems to how to build a team and make valuable connections. At Keller Williams, they let you build your own brand and now I can easily go off on my own as we have a solid brand. Vest your profit share after three years and then find a 100% boutique shop that will let you keep your own brand. I don't think Keller Williams is a fit for people who do investments like discussed on BiggerPockets.
@Ryland - I know this is an old post, but wow, thank you great information!
- Member since 2022 · 2 posts · 0 votes3y
I've been flippin' & floppin' on whether to move to a smaller brokerage. The one we have now is the biggest in our county. I agree on the advantages, but while ours does make marketing easier, it still relies on more work than walking down to hall and asking our expert to make something up.we have a good 400 agents, and it would be some task if he had to do that for everyone, but he does come up with some good ideas, like sending out market reports regularly to the clients on our CRM, which by the way the company also provides. And he is kind of a 'built in' Canva creating more ad options for our use on our social media not just our company website.
Besides losing the name of our brokerage by moving on, the ideal of having to change all my ads, etc. to reflect the new brokerage seems very daunting. And I fear more alienating to my existing clients. Our brokerage is having constant alliances with big name promotions, but even with the company discounts, it is more money out for newer agents, and not much help for well established ones.
I feel almost guilty not signing up for every activity, but I guess if I am going to be a busy guy I would rather be running to different neighborhoods promoting myself, then spend that time at company socials, etc. i know interfacing with colleagues is still important, as well as my manager not forgetting what I look like. But I tend to be more of a lone wolf working in the field.
Starting at a major brokerage is invaluable, especially for training, and other resources. But now the advantages seem to take up more time when working at a small firm would encourage me to hit the streets more often and mingle with more locals. Plus, the one I am considering is in a great 'easy to walk in' corner office close to small businesses and a nice small town residential area.
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