New Broker - How to do learn Brokerage Operations

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New Broker - How to do learn Brokerage Operations

Llewelyn A.
Investor / Broker · Brooklyn, NY · Member since 2016 · 665 posts · 1k+ votes

@Russell Brazil

@James Wise

@Joel Owens

@Darren Sager

@jay hinrichs

Well, I find myself in a bit of a dilemma.

I decided to get my Broker's License and start a Brokerage Firm. I now have my NY Real Estate BROKER's License (Note, Broker's License, not Salesperson's License) under my own Brokerage. I even have my Broker's Pocket Card! haha!

I qualified based on personal experience which means buying, selling, renting, mortgaging, etc. of my own Properties.

I opened my Firm and will probably purchase a property sometime this year in the $2 Million range which should give me a 3% Commission or around $60k.

HOWEVER, I am also thinking that I would like to offer friends and family my service as well and to give them a discount on my commission... at least in the beginning few years until I really understand all the things a Broker really needs to know.

I'll probably just concentrate on being a Buyer Broker rather than listing as I don't have experience YET at selling.

I won't take on an Agent just yet either until I fully learn all the normal operations of a Residential Brokerage Firm.

The dilemma I am having is that because I have not worked as an Agent, I am now tasked with understanding how to run a Brokerage firm from scratch.

So even simple things are unfamiliar to me including:

1) Associating/Disassociating Agents. File Agent's Licenses until they disassociate.

2) Insurances like General Liability and E&O

3) Forms such as co-Broke for Listed MLS Properties

4) Which Disclosures are needed for what circumstances... ie. Lead Paint Disclosure for Properties build before 1978

5) Keep all documents for 3 years.

6) How to conduct a proper CMA

7) How to conduct a proper BPO

etc.

I have both the Salesperson and Broker's License Study Guides which gives me a lot of information. However, to be honest, a lot of the material references are pre-2008. I don't trust that the Official Study Guides and Exam Questions and Answers are actually up to date.

I tried looking for Real Estate Office Management Books... there are several but I don't know which would be detailed enough for me to actually pick up the business processes and steps needed to run a Brokerage Office so that I conform to NYS/NYC laws.

I am planning on joining our local board, the Real Estate Board of NY (REBNY) and to have a NAR membership.

I will be asking them about education on how to run the Brokerage.

I want to keep it as a one man Brokerage until I understand exactly what I need to know.

Any suggestions would certainly be welcomed.

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Charlie MacPherson
China, ME · Member since 2014 · 3k+ posts · 4k+ votes
8y

@Llewelyn A. I strongly recommend working at another firm for a while.  There are far too many scenarios and details to learn from a book or even here on BP.  

If you go out on your own with zero experience, you're going to get hurt - and you'll end up hurting your clients too.

In MA, we're required to work under a broker for 3 years before we can even take the broker's test.  There's a very good reason for that.

In a similar situation, my solution was to retain an attorney to be my broker of record.  It worked out so well that I've kept him on, even though I can now get my broker's license.

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  • Sam Shueh
    Real Estate Agent · Cupertino, CA · Member since 2016 · 4k+ posts · 1k+ votes
    8y

    CALIFORNIA has 134,000 brokers and have slightly more salespersons.  It did not require work experience and needing little studies to be ready for both tests than profession like hairdresser. Almost all attorneys have a real estate broker, esq designation.  99% work in a broker-associate capacity. If one has the desire to endorse his own convictions, willing to spend high rental and have the tolerance to fend off legal intruders then realtor firm ownership is a natural choice. It is realtor or broker associates choice whom they want to hang their license with.   Often it is leads, commission office location etc.

    My suggestion is learn the business first before the ultimate dream owning a brokerage.  You probably get noticed better joining a nation wide brokerage at the cost having to gave the commission back to corporate.


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  • Llewelyn A.
    OP
    Investor / Broker · Brooklyn, NY · Member since 2016 · 665 posts · 1k+ votes
    8y

    @Sam Shueh

    Thanks for the advice.

    I have already started the Brokerage.

    I just secured my Broker friends, one of whom owned his firm for 15 years and he said he would oversee my transactions until I'm ready to be on my own. No cost to me. He owes me for helping him out when he needed it most.

    Since I won't be taking on an Agent, it will be easier on my Broker friends when I do get into my first Purchase as Buyer who is a Broker.

    So it looks like I'm all good!

    1Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
    8y
    Originally posted by @Llewelyn A.:

    @Russell Brazil

    @James Wise

    @Joel Owens

    @Darren Sager

    @jay hinrichs

    Well, I find myself in a bit of a dilemma.

    I decided to get my Broker's License and start a Brokerage Firm. I now have my NY Real Estate BROKER's License (Note, Broker's License, not Salesperson's License) under my own Brokerage. I even have my Broker's Pocket Card! haha!

    I qualified based on personal experience which means buying, selling, renting, mortgaging, etc. of my own Properties.

    I opened my Firm and will probably purchase a property sometime this year in the $2 Million range which should give me a 3% Commission or around $60k.

    HOWEVER, I am also thinking that I would like to offer friends and family my service as well and to give them a discount on my commission... at least in the beginning few years until I really understand all the things a Broker really needs to know.

    I'll probably just concentrate on being a Buyer Broker rather than listing as I don't have experience YET at selling.

    I won't take on an Agent just yet either until I fully learn all the normal operations of a Residential Brokerage Firm.

    The dilemma I am having is that because I have not worked as an Agent, I am now tasked with understanding how to run a Brokerage firm from scratch.

    So even simple things are unfamiliar to me including:

    1) Associating/Disassociating Agents. File Agent's Licenses until they disassociate.

    2) Insurances like General Liability and E&O

    3) Forms such as co-Broke for Listed MLS Properties

    4) Which Disclosures are needed for what circumstances... ie. Lead Paint Disclosure for Properties build before 1978

    5) Keep all documents for 3 years.

    6) How to conduct a proper CMA

    7) How to conduct a proper BPO

    etc.

    I have both the Salesperson and Broker's License Study Guides which gives me a lot of information. However, to be honest, a lot of the material references are pre-2008. I don't trust that the Official Study Guides and Exam Questions and Answers are actually up to date.

    I tried looking for Real Estate Office Management Books... there are several but I don't know which would be detailed enough for me to actually pick up the business processes and steps needed to run a Brokerage Office so that I conform to NYS/NYC laws.

    I am planning on joining our local board, the Real Estate Board of NY (REBNY) and to have a NAR membership.

    I will be asking them about education on how to run the Brokerage.

    I want to keep it as a one man Brokerage until I understand exactly what I need to know.

    Any suggestions would certainly be welcomed.

     This is why most states require a licensee to work for another brokerage for awhile before starting their own. Kinda shocked that your state will let you start your own firm from scratch actually. May not be a bad idea for you to work under someone for a little while. The small amount of commission you need to pay to the broker is pennies in the grand scheme of what you can learn from working in their business. That said, if you don't go that route this is what I would do...

    1) Associating/Disassociating Agents. File Agent's Licenses until they disassociate.

    Contact the Division of Real Estate.

    2) Insurances like General Liability and E&O

    Google search should bring up several providers. Talk with them.

    3) Forms such as co-Broke for Listed MLS Properties

    Not following what you mean by this one? You typically just place the Co-Broker info into the MLS. The MLS you are joining usually offers training, so probably a good idea to look into that.

    4) Which Disclosures are needed for what circumstances... ie. Lead Paint Disclosure for Properties build before 1978

    Your Real Estate Law classes should have went over this.

    5) Keep all documents for 3 years.

    Your Real Estate Law classes should have went over this.

    6) How to conduct a proper CMA

    Comps. Run comps & make an educated opinion of value. The more experience you have the more weight your opinion will carry. Everyone's got an opinion. It's all about whether or not yours is right.

    7) How to conduct a proper BPO

    Comps. Run comps & make an educated opinion of value. The more experience you have the more weight your opinion will carry. Everyone's got an opinion. It's all about whether or not yours is right.

    1Reply
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