Selecting a Broker and Joining Teams

In Episode 1 of Real Estate Common Sense we start at the beginning.  

This episode breaks down 10 questions every agent should ask their broker, and other common sense details that assist in launching a career in real estate.

Although this episode talks about one of the most basic assumptions, choosing a broker, it also discusses the importance of making an informed decision about where you will launch your real estate career.

Real estate coaching, mentoring and training are highlighted as the first essential decision an agent makes.

Transcript

0:05

Welcome to real estate common sense. I'm Lisa Spencer and I grew up in a real estate family. I was a top producing agent and a managing broker with over 400 agents for over a decade. What I discovered is common sense is not that common. Especially when it comes to launching building or expanding a real estate business. I have interviewed thousands of agents and helped hundreds launch, successful careers. You'd likely hear from some of them in future episodes. Today. Let's begin with you. Here in our first episode, we'll assume that, you know, 43,560 square feet is an acre and that you've passed your state licensing exam. The first thing you need to do in most states is select a broker. I did this completely wrong because I simply went to work with my uncle who was the manager of a major brand that distributed leads to the agents. I didn't know this until years later, but he promised the other agents in that office that he would not give me any leads. In the long run, it worked out well for me, because it forced me to find business for myself. But a few leads in those early days would have been really helpful. So, what questions should you ask when you interview your potential broker? Yes, you are interviewing them. More really then they're interviewing you. It's not the same as a job interview. You're going to work under the supervision of your managing broker. Take time to consider a few things. Like what is the reputation of the company? And what is the reputation with consumers? As well as the reputation with real estate agents in the community. Do they have a national brand recognition? Or, are they an influential local office that dominates the market in your area? Regardless of the requirements of broker supervision. Choosing a broker is one of the most important decisions we make when launching our real estate career. Unfortunately, many agents joined the brokerage of a friend or a family member like I did or fall into a relationship with a broker, just because the licensing course was held at that brokerage. In my years of interviewing agents, their interviews usually focused on splits. They wanted to know how their money that they earned was going to be divided. Space. They wanted to know where they were going to sit. When they came to work and software, they thought about how is this technology going to help me? Although, these are important considerations, the following things had more influence on the success of the agents, and many of them never asked questions about these things. Coaching. How important is personal and professional growth to you? If it's important. Your broker should have some kind of coaching or mentoring program. Collaboration: are the fellow agents in the office sharing their best practices. Are they in a spirit of collaboration, or competition where everyone stays to themselves and keeps their secrets to themselves. By the way, there are no secrets. We all know how to succeed in real estate. Culture is the office, a high energy positive environment, and then community. Do you feel like you'll be able to contribute to the community and will you be able to benefit by the contributions of others? This is really important. Your relationship with your broker is your first partnership. It's an important relationship. And one that should not be entered into lightly. When I started, I took a shortcut because I went to work with my favorite uncle, quite possibly my favorite person on earth. So the most important factor of trust was already built in. Because we had that foundation of trust. We worked through all the other issues. So take time to assess how the broker made you feel on that interview. Trust your spidey senses. Make the decision slowly and purposely and change it quickly. If it's the wrong fit. The longer you're in the business, the harder it is to change brokerages. So for practical purposes. Here are 10 important questions that I feel will help you in that selection process. The first is, is there a mentorship or training program? So many offices talk about their success and yet, how are you going to be able to ramp your business up and be as successful the other agents in the office? If no, one's there to help you succeed. It's going to be a lonely ride. So that's the first and I feel most important question. The second are the agents Realtors?. It's an important distinction. Remember, not all real estate agents are Realtors and being a realtor means that you will pay for national, local, and board dues that allow you to use that designation. So it's just important to know if your office are Realtors are not. Third, what marketing collateral might be provided by the office? Are they going to provide a website signs, buyer and seller presentations, business cards, open house signs or other signage? These can be a significant cost if you're starting on your own. Or they can be a huge value if they're provided by your broker. What additional marketing support do they offer? Does the broker advertise your listings? If they do, who gets the leads from that advertising? Remember the listings belong to the broker. What is the understanding about leads generated from the marketing of your listings? It's very important to understand this going in. Question number four. What technology is used by the brokerage. At a minimum, there should be a technology that includes an e-signature platform and document storage. But many brokerages go far beyond that. Is there a CRM, a customer relationship management system. Who will help you learn the systems in the office and who has access to the data? Who will keep this data. If you leave? Question number five. How will the broker assist with building your business? Are leads provided. If so, how are they distributed? Round Robin? By performance? Seniority? If leads are not provided, how will the brokerage assist you in generating your own? Question number six. How is the compensation structured? This varies wildly and is mostly based on the answer to the previous question about leads. The more, a brokerage assists you, the more of the commission they will expect. There are even 100% companies out there. Which leads us to why you need to ask the next question. What fees are required by the brokerage is question number seven. Is there a registration fee, a monthly fee, a technology fee. Ask about the details. Are there any other fees? A brokerage that depends on fees to be profitable, does little to nothing to support agents and building their business. You want to be affiliated with a company that derives its profits from their share of the commission earned by their agents. That means if you don't make money, they don't make money. And that will establish a vested interest in your success. If it's a 100% company they're depending on fees for profitability. Question number eight. Does the broker compete? This is not an easy yes or no question. And, it's still important to ask. If the broker competes, it means that your broker may possibly be going on an appointment with the same potential seller that you are. Will you feel comfortable with the broker having access to your database? Your comfort level with this will depend on how well you trust your broker. Question number nine. What happens if you decide to leave? Yes, it's awkward. And we have to have this conversation. We, before we signed up with a broker. In many states, again, all listings belong to the broker. Will the broker let you take the listing with you when you leave? Most brokers require you to close any fully executed contract with that brokerage. But there may be a penalty if you leave before closing. Will your contract be assigned to someone else to close, which interferes with your relationship with your client and may require you to pay a hefty referral fee. I know it's awkward, and we have to ask the question: what happens when I leave? What happens to the business that I have pending with your office? Question number 10. You need to find out how much the broker loves real estate. Ask them their favorite part about the job. Passion and enthusiasm go a long way in this business. Ask about their favorite part of the job. Is it helping other people grow? That is the winning answer. The most important thing to remember is this is a partnership, your first partnership in real estate. Which brings us to teams. To team or not to team. That is the question. One of the most fascinating developments in real estate is the team model. Real estate has always been locally driven. Realtors are connectors and they are usually deeply entrenched in the local community. Top agents grow teams that permit them to leverage functions that don't require people connections. Connecting with people is the highest and best use of an agent's time. So the first thing an agent does as their business grows is outsource things like marketing, transaction management, and appointment setting. If you're interviewing with a team that doesn't have those things in place, I'd take a pause the buyer's agent should not be the first hire on a team. But let's say they do have those things in place. The buyer's agent model was born from the concept that a top listing agent will generate so many buyer leads from their marketing that they can't handle the volume. When a newer agent joins a team as a buyer's agent they are given instant access to buyer leads this sounds like a no brainer, right Well not so fast. There isn't an easy answer about whether you should join a team or not: However there are some important considerations. Many agents get frustrated because they go through training and they're ready to launch their career and they just are getting a slower start than they thought they would. Then they see the teams dominating the monthly awards at the office and they start thinking: How can i get on the fast track to success?" Sometimes joining a team is exactly the right thing to do; However when you join a team remember that you're building that business. You're not just there to get leads you're there to contribute to the overall success of The team And many many teams are a great environment for growth. So, sometimes agents will go there and just join for a couple of years, it's a great way to get mentoring and training. It's very very important though to understand a couple of things. You're going to be operating under your brokerage split you talked about that in your interview how is your money going to be split with the broker. Then essentially when you're on a team the team is sending you a referral fee for the work you're doing so you'll also share that referral fee with your broker This can mean that you'll end up with as little as 10% of the total commission so how much are you willing to dilute your income by joining a team? Then remember simple math it's better to keep 10% of something than a hundred percent of nothing! If by joining a team, you'll work leads you otherwise would not have had access to this is a win. Teams want to hire talent and you want to be a part of a vibrant and dynamic team. But, don't let your ambition emotion and energy make you rush into a decision. Sometimes, even when you bring your own lead to the team, it is still subject to the team compensation structure. So make it very clear in writing with your Rainmaker,or lead agent, what the expectation is around this. Will the business that you bring into the team as opposed to what the team gives you be subject to the same compensation model? Every team is different and offers unique value. So as long as you make things very very clear then it's usually a recipe for success. When I say very very clear I mean in writing! I am currently on a team myself, it is led by my daughter. The trust circle usually doesn't get any tighter than with a mother and daughter and yet, I also want to let you know, that the team led by my daughter and I have a written agreement.Whenever you join a team as well as whatever you do with your broker It should be established in writing. In this episode we've covered activities that you should complete within the first weeks of receiving your license, Or if you're listening to this before you get your real estate license you can start interviewing brokers now and get a headstart So it's time to put a bow on this episode by sharing resources that will give you some structure to our future conversations Our first few episodes we'll focus on the basics and then we'll dive into conversations with top agents and learn how they're leveraging some common sense principles to grow their business The first resource is a book real estate common sense that you can order on amazon. And, our website RealEstateCommonSense.com, which provides business building tools, buyer and seller resources, and a calendar of live events. You can also find us on facebook and youtube where we publish articles and post helpful videos. We hope you've enjoyed this episode and you'll join us as we share real estate common sense support for agents launching building or expanding their real estate business Tune into our next podcast about finding new business I'm your host lisa spencer sending love and wishing you success