How to Begin Looking for the Right Real Estate Brokerage
Looking to join a real estate brokerage but you aren’t completely sure where to start? Don’t worry, this is normal! Every agent begins their career trying to find the right brokerage for them. When you consider the incredible range of options offered in today’s real estate brokerage environment, that can be a challenging objective. In fact, you may have even noticed that many agents you know have jumped from brokerage to brokerage more than once. Many times that’s because circumstances change, but more often than not I believe it is because the agent did not do their proper homework.
While you are completing your course work, it is just as important that you begin meeting with different brokerages and teams. In the current brokerage market, it will not be hard to set up these meetings with most brokerages of any size. Large franchise brokerage models rely on recruiting as many agents as possible, while smaller, local brokerages often do not spend a lot on recruiting and are also normally thrilled when someone reaches out to them professionally for a meeting. With that being said, do keep in mind that even as a new agent, you have more leverage than you may think.
Finding the right brokerage or team to join can set the stage for a long, prosperous career in real estate. The real question is, how do you find the right brokerage?
What to Look For
As someone who has been in the industry for a long time as both an agent and a broker, I tried to think through all of the things I believe agents should consider before they join a real estate brokerage.
#1 – Brokerage Size
Does the size of the brokerage make sense for your goals and the way you work? Some people may prefer a larger brokerage where they can network with a lot of other agents and blend in, while others may prefer a smaller brokerage where there is more opportunity to stand out. Neither small, medium, nor large brokerages are necessarily better than the other.
Whether it is previous classes at school, sports, friends groups, or something else, carefully consider the types of environments where you have thrived in the past. Do you like to be a big fish in a small pond, or are you more comfortable blending in with a large group? These are important things to consider.
#2 – Quality Technology
If you are not up to speed on real estate technology, then I would highly suggest that you become familiar (consider reading my getting started tech guide for real estate). Technology is becoming more and more intertwined with the way we live by the day, and the real estate industry is no different. When you are speaking with brokerages ask them a lot of questions about the technology they offer and what the cost to the agent is for this technology.
I have found that a lot of brokerages will use buzz words like AI, CRM, the Cloud, etc, but then when you actually look at what they offer it isn’t anything all that special. On top of that, they will charge you a monthly fee just to have access to the technology that you may end up not even using. It is not at all uncommon to see agents at big brokerages using independent software platforms that they have to pay for themselves AND paying the brokerage for software that they never use.
#3 – Training (Hint: It May Not Matter!)
Another brokerage selling point you will here be touted quite often from many brokerages is ‘training’! They will shout it from the rooftops as if they are going to mold each and every agent that joins them into the ultimate agent. I hate to be negative or the bearer of bad news, but most of this training is just more classroom or CE work that will seem incredibly similar to the classes you just went through to get your license in the first place.
The truth of the matter is, training and real estate coaches are everywhere. The web, Youtube, independent coaches, your local board, etc all offer tons of valuable training that may even be more tailored to your specific needs than what a brokerage will offer. All of this learning is absolutely very important, however, none of it will make up for actual work in the field. Regardless of where you hang your license, you need to find mentors in the industry that will allow you to help with open houses, showings, writing contracts, mailings, or anything else you can help with. This is how you will learn, and by the way, you’ll probably have to do it for free.
#4 – Cost and Splits
I’m going to say this first because it is very important, commission splits do not matter when you are starting your real estate career. Let me say this again, commission splits don’t matter when you are starting your real estate career! (haha, ok, sorry, you get the point). Be realistic about what kind of split to expect if you are just starting out in real estate, the monthly fees may be more important than the split itself anyway.
There are many low-cost brokerages out there, but those aren’t typically the best place for new agents to start out, even if it may be something to consider as your career progresses. If you are considering starting out on a team, you will definitely be relegated to a much lower split, but you will more than likely make up for that with the extra leads and exposure you receive if you choose your team wisely. It’s important to balance the compensation you will receive, with the access to the variables you will need to start your career in real estate.
Also, consider your personal financial status, and consider reading my financial guide to begin in real estate.
4 Reasons Not To
#1 – Don’t Join Because of a Friend or Relative
I know it can be tempting to join a brokerage because you already have a friend or relative telling you how great their company is. While that advice definitely shouldn’t be ignored, don’t let it dissuade you from doing some research of your own. As I have discussed throughout this article, there are plenty of reasons one brokerage may work for one person and not for another.
There are also crucial relationship pitfalls to consider. If you are going to work somewhere because of a person you know, be sure to set some ground rules on how you are going to interact with that person before you join. Are they going to help you? If so what does that mean exactly? What happens if you are both competing for the business of a common associate? It’s important to consider these items and have a serious conversation before you are forced into an awkward situation.
#2 – Don’t Fall for Pyramid Schemes
I’ve seen the fancy recruiting material that many brokerages hand out with the crazy amounts of money you can earn, just for signing up more agents. Please remember, they spend an inordinate amount of time on their recruiting efforts because, in reality, you are their product. They need to jam their rosters full with as many agents as possible to pay monthly fees, which in turn, covers their overhead and keeps the pyramid train running. The best part is, many of the agents trying to recruit you will tell you that they are in fact “not a pyramid scheme.” I won’t name names, but please just think it through.
Many brokerages are so good at selling their brokerage to new agents that their turnover rate is nothing short of remarkable. A new agent joins after being promised the moon, then they leave after realizing it’s not true, then another new agent joins and the cycle continues to repeat itself. All the while a few high-producing recruiters sing from the mountain tops about how great the “opportunity” is. Please believe me when I say that you need to look past it and focus on what truly matters to you about a real estate career.
#3 – Don’t Believe the Hype
This somewhat falls into my last point but is important to point out nonetheless. It is very common for recruiters to pump agents up into believing they will do $3 million-plus in sales their first year, but they “only have room on their roster for one more agent”, or they “only have leads available for one more agent”! 99% of the time this is not true, don’t let them pressure you into making a hasty decision. No brokerage can truly promise you sales.
Nine times out of ten, when an agent is underperforming it has far more to do with their personal marketing decisions or situation than the brokerage they are working for. After all, most clients work with the agent they prefer, not the brokerage.
#4 – Don’t Overthink It
At the end of the day, just don’t spend too much time trying to decide. While I know I’m telling you to take your time and make a good decision throughout most of this article, it really isn’t worth spending too much of your time and effort upfront. The odds are that after you get started in real estate, you will begin to realize whether or not the brokerage you joined is a good fit.
If you find that it really isn’t for you, it is possible to change brokerages at just about anytime. However, I do recommend that you don’t become a “brokerage hopper”. If you choose a broker and it isn’t going as you hoped, try to remember the reasons you joined in the first place. Often times agents leave because they believe the grass is greener on the other side when really there are things they can do internally to improve their business.
Other Things to “Do” and Consider
Do Talk to Successful Team Leaders
If they will take a meeting with you, definitely consider meeting with team leads that are open to taking on new agents. Working with a team may be a great way to start in real estate. The splits are usually lower, and the time commitment is probably going to be higher. However, the opportunity to quickly learn the ropes is going to be much greater in a team environment than on your own. However, just like the brokerages, be sure that they are a good fit for where you want your career to go.
Do Your Own Research Before Joining
We already discussed this briefly, but don’t just listen to friends or relatives about how great a certain brokerage is. Talk to people, read reviews, call random agents at the brokerage, etc. Do your homework on any brokerage you are seriously considering. Remember, this is YOUR business and it’s important what brand/company you choose to align yourself with.
Do Consider Your Goals
This is the first homework I have given out in this entire article, and you almost made it to the end, sorry about that! Now is the time to put pen to paper and really begin setting realistic goals for yourself. Here is a link to an exercise that may help to set your goals and how to identify if a brokerage is a right fit for them. It’s just a google spreadsheet that I made, but it may be of use.
Do Work Hard
My last piece of advice, no matter who you decide to partner with, please remember that this is your real estate business. The only way you will be successful if you are willing to work incredibly hard for your success. It is easy to fall into the trap of believing that life is all glitz and glam for the most successful of agents. While it’s true that many agents lead a comfortable lifestyle, what is often hidden from sight is all of the hard work they had to do to get there.
Regardless of the brokerage you choose, your effort will determine whether you sink or swim at the end of the day. I wish you nothing but the best of luck!