The Rise of the Indy Real Estate Brokerage
The Rise of the Indy
Independent Real Estate Brokerages seem to be all the rage these days.
Teams becoming brokerages, brokers leaving bigger brands, indy’s trying to franchise (when an Indy franchises, does it cease to be an Indy? Food for thought).
I have to say, the real estate space is becoming very crowded, yet still very exciting all the same.
The proliferation of teams throughout North America is prevalent in almost every market. Team leaders have built infrastructure to provide, for the most part, what a lot of more traditional real estate offices do not.
Now, I don’t want to pick a fight so I am not going to get in to what is or isn’t being offered, but let’s just say that people join teams for good reason, in short, leads, training, culture, mentorship to name but a few.
Out of the Frying Pan and Into the Fire
So why are more and more teams leaving the ‘safe haven’ of a brokerage and becoming the broker?
Easy. Don’t you see it?
Dollar bills y’all. ~ Jimmy Spicer
Look, the broker of today is for the most part making a good amount of money off of the team, it doesn’t matter if there are 5, 10 or 15 agents or more.
As they say in Vegas, the house always wins.
Why?
Because they know the team is going to take on a lot of what they aren’t going to offer, some of which is mentioned above.
They win because of that, but also because of ‘head count’, as we know, in order for a brokerage to survive and make money they need people.
So what else are they taking on then?
Good question my friend. You see most teams already have the infrastructure in place that a brokerage has, admin, websites, technology, tools, culture, training, coaching etc.
The next step is the regulatory compliance side of things.
Some may consider these trite or a waste of time, but they are absolutely needed when building your own brokerage….things like a policies and procedure manual, ICA agreements, Fintrac manuals, a health and safety person, a broker of record, trust accounts, operating accounts….and the list goes on.
Some see this as a headache. They should be seeing it as opportunity though.
The mechanics of setting this up for most teams, as mentioned before is already there, the other items come down to regulatory compliance which will be a lot of work to set up initially, but once it’s done…it’s done.
The second part of this, and I think perhaps one of the barriers to entry, is the responsibility the team leader (maybe now broker) has for the individual, independent contractor, that is a part of their team.
Things change when you become the BOR, you are now no longer to shuffle off regulatory compliance or issues with other Realtors or brokerages, to your broker of record because YOU ARE the broker of record.
As more and more team leaders begin to examine the fruitful possibilities of becoming their own brokerage what does that mean for the traditional brands that are out there?
This is fodder for another blog post, in short, the more traditional brands need to start to offer more tools, training and technology to their brokers who can then pass this along to their agents and team leaders.
They should be laser focused on culture and fostering an environment of collaboration and not of competition.
Some brands throughout North America are doing this and seeing a lot of success with it….the other part of this equation is to work with the team leaders to ensure that they are providing an environment to allow their team to become even more successful.
Exchange Value: The quantified worth of one good or service expressed in terms of worth of another.
In these terms, the team leader has to continually see the value that the broker is bringing to the team and to the team leader each and every day.
If this ceases to exist, for the short term pain that the team lead is going to incur, the idea of becoming a brokerage becomes more and more real with each passing day.