If your goal is to own a real estate brokerage, there are several key attributes you will want to possess to ensure success.
As an owner, a lot rides on your every move. Not only are you responsible for the company’s success, you also have to help your agents harness their own opportunities for success.
Bryan Brooks, senior vice president of Franchise Sales for HomeSmart International, explained that a credible real estate broker is someone who leads by example and can coach his/her agents to be business-minded, while constantly striving for continued growth and is agile enough to strategically adapt with industry and consumer trends.
“Over the course of my career in the industry, I’ve noticed several characteristics the most successful brokers possess,” he said. “So, take a moment to look at your own strengths and see how you stack up with other successful broker peers.”
Brooks notes the first trait needed for success is attentive leadership.
Leading a real estate brokerage is more than building a brokerage. You also have to be in tune you’re your agents’ needs, mentoring and coaching for accountability and growth.
“Time and again I see how successful brokers invest in knowing what their agents’ strengths and weaknesses are, and then coach to those strengths and mentor through weaknesses,” Brooks said. “It’s behaviors like these that show agents the broker genuinely cares about agent success.”
How you manage your brokerage will also determine how you are viewed by agents, some who could be prospective team members.
As you grow, one activity to consider shying away from is so-called “warehousing,” a move of allowing inactive agents to carry your business card, which can hurt the brand you are trying to build. There are pros and cons to this practice. It can work for some brokers. You have to weigh the impact it could have for you.
According to Town Residential CEO Andrew Heiberger and Brown Harris Stevens executive vice president Bess Freedman, brokers will churn through agents if they are willing to “warehouse licenses,” the practice of retaining non-producing agents.
At Town, Heiberger said that agents must be actively engaged to stick around.
“Why should a non-producer carry the same card as somebody who is here 60 hours a week?” he said.
“A lot firms will throw out this big net and take everybody,” added Freedman. “To me it seems desperate. There is no quality control.”
Successful brokers also have a presence in the community, participating in charity events and other activities. They influence agents to give back to the communities.
Another attribute is an intuitive business acumen. This helps you to understand the bottom line of the brokerage. It is key that the manager of the day-to-day operations of a brokerage know how to effectively manage the nitty-gritty business details, like assessing P&L reports and identifying opportunities for either investment or streamlining expenses
“Some of the most successful brokerage operators I know have a background in finance or accounting,” Brooks noted. “Why? Because they’re not afraid to make the tough financial decisions for the ultimate good and long-term growth of a company.”
Without this, you should hire or partner with someone you trust who can help you make financially-wise decisions about things like office space leases, technology or marketing expenses.
Training also is important for the broker.
Though philosophies differ, all brokerages struggle with how much time and what resources to put into hiring and training.
“It’s a major, major issue. I have staff whose primary function is just paperwork and onboarding,” said Mark Chin, the head of Keller Williams in Tribeca. “As head of the brokerage I spend 10 hours a week training brokers, because that is an incredibly important part of retention. If they see senior management caring to that level, they are like, ‘Okay, this is the kind of place I want to be.’”
Brooks also points out that it is important to be forward thinking and growth-minded.
“Brokers should always be thinking about how to ensure the future success of the brokerage through consistent growth,” he said. “You must have the ability to understand and identify why you wanted to build a brokerage.”
Additionally, being adaptable to change will go a long way to building a successful brokerage. If you can identify changes in the marketplace, economy and housing market and then adapt and change, you maximize your chances for success.
“To stay ahead of the competition, it’s always wise to arm yourself with competitive intelligence,” Brooks added. “Research how other industries are adapting and then apply timely and strategic changes to your own company.
Finally, be technology-focused as a broker.
So much of what we do today, from our experiences to simple interactions are impacted by technology. It also has changed the way the real estate market operates over the last decade.
Brooks notes that brokers need to keep up. A key hurdle that derails many small- and medium-sized brokerages is technology.
“The problem many brokers face is that piecemeal technology solutions can be crushingly expensive to offer agents,” Brooks added. “It’s costly to provide transaction management, website, CRM and CMA systems for agents, among other things.”
Tying all of these aspects together and knowing what is important for you as you build a brokerage is important for your success.
“Successful real estate brokers lead teams effectively, guide the financial stability of the brokerage and create ongoing opportunities for agents to harness their own skills to serve homebuyers and sellers with the highest levels of knowledge and service,” Brooks concluded.