You’ve worked hard to establish your own brokerage. Now you want to increase the profile of your business by adding Warren Buffett’s banner. It isn’t going to be cheap.
For $25,000, you can become a franchisee of Berkshire Hathaway HomeServices, the conglomerate’s real estate franchise network of over 1,200 offices across the U.S. In 2017, Berkshire Hathaway came to New York City, traditionally the land of independent brokerages but still a market in which franchise brands have a substantial footprint.
REALTOR Magazine’s annual franchise report breaks down the costs associated with becoming a franchisee of the biggest brands.
The largest brand with a New York presence — Century 21 Real Estate — has 2,216 offices around the country and 128 in the metro area, with a concentration in Brooklyn and Queens. Century 21 franchisees pay royalties of 6 percent of gross revenue per transaction, plus a marketing fee (2 percent of gross revenue) and a training fee of $399 per attendee.
Shooting a little lower than Warren Buffett? You still will have to open the check book.
Keller Williams charges franchisees a 6 percent royalty fee (capped at $3,000 per agent per year) as well as a $1,000 per office annual marketing fee, a technology fee ($79 per office), an educational fee ($299 to $2,500 per course) and a $500-per-office fee for KWConnect, an online training portal.
What are the going rates to open a franchise for some leading name brands?
For KW, it is $35,000. Better Homes and Gardens Real Estate will cost $35,000 (first office) and $10,000 (branch)
EXIT Realty USA charges $32,000 (urban) and $7,500 (rural).
If you want to target Century 21 Real Estate, the cost is $25,000 (first office) and $10,000 (branch).
Coldwell Banker Real Estate comes in with similar rates, at $25,000 (first office) and $10,000 (branch).
Sotheby’s International Realty Affiliates and Weichert Real Estate Advisors both are pegged at $25,000 and HomeSmart International is $20,000.
More affordable options include NextHome, with fees of $2,750 to $6,750, and Flat Rate Realty, at $1,995.