BrokerPulse

RealTrends Q4 2021 BrokerPulse: Office consolidation, boosting agent productivity and core services capture rates continue…

2021 Website Rankings Now Live!

RealTrends website rankings highlights the top real estate websites across the country in 6 total categories for our annual brokerage website rankings.

Real estate teams vs brokerages

Steve Murray and Tracey Velt discuss the profitability of real estate teams vs brokerages, based on the results of the 2021 RealTrends Team Profitability Study.

Study: It’s true, real estate teams outperform brokerage firms

Surveyed real estate team gross margins were an average of 61.8% compared to an average of 13.8% for real estate brokerage firms.

AgentIndustry ContributorsNewsletter

The 4-step formula to build a sustainable real estate business

For decades, new-to-real estate entrepreneurial agents set their sights on establishing independent businesses. With the assistance of a broker, an individual could get something started with low capital investment and grow it into a small business that produced a long-term, sustainable income.

For many individuals, this scratched the itch to be independent, build something of their own, and pursue work that had meaning. But in today’s low-inventory and hyper-competitive marketplace, is a new agent’s quest to quickly establish themselves as an independent agent even viable?

Discovering the Formula

Earlier this month, I had the opportunity to interview three up-and-coming new agents from Comey and Shepherd Realtors (C&S) in Cincinnati who have experienced early success as independent agents.  I also interviewed the managers and the trainers who equipped them to gain traction quickly. 

A formula emerged that will help you determine if you have the necessary traits and capacities to be an independent agent.  It will also help you recognize the traits of the brokerages who are best suited to help you quickly build a sustainable business.

Skills and Capacities

To start and run a real estate business, you need the capacity to learn quickly. Being the smartest person in the room does not guarantee success, but if you’re not able to capture and digest new information quickly, you’ll likely fail.

Among the agents interviewed, solid communication skills were cited as the most important trait needed as the baseline for success. The ability to show empathy, speak persuasively, and to understand the needs and concerns of others is critical.

The second most important trait was putting newly acquired knowledge into action.   All of the new agents at C&S received the same training, but the agents who experienced early success were doers. 

“In the first few months as an agent, I was constantly putting myself out there.  I knew I would make some mistakes, but I was willing try things other agents didn’t want to do,” said Brooke McCabe, an agent with C&S.

Focus and Work Ethic

To be successful as an independent agent requires an intense focus on the challenge of getting a new real estate business established.  It requires a full-time effort and a willingness to work harder than your peers.

According to C&S Sales Associate Cheryl Boettger, “If you don’t know how to work hard, you’re not going to be successful as a new agent.  You have to motivate yourself to perform, and that takes a level of maturity and seriousness many agents don’t possess.”

Beth Farr, an agent with C&S, agrees. “When I first started, I was willing to do anything for anybody.  I knew I was going to have to hustle, and I was not afraid to talk to people. If you’re a fearful person, being an independent agent may not be a good fit.”

All the agents I interviewed were intensely focused on a specific result they hoped to accomplish.  Some of those results were inside their businesses (ex. I want to get to 36 transactions/year) and others were external (ex. I need to make a significant contribution to my family’s income).

 But all of them were meaningful, important, and worthy of their focus.

Character and Motivation

People who get into real estate do so for a combination of these three reasons—independence, reward, or meaning. If independence is your goal, you’ll need to be self-motivated, resilient, and persevere when things get difficult.

If reward is your goal, you’ll need to create a plan that leads to your long-term financial objective. The investment in your plan means consistently making small contributions in the lives of your clients, those in your professional network, and others who can contribute to your financial growth.

“Accomplishing my financial goals requires me to be consistent in every part of my business.  I know others are depending on me, and I don’t want to let them down,” says McCabe.

If meaning is your goal, you’ll need to empathize with the struggles others are experiencing and find joy in seeing your clients reach their goals.

“I have a naturally large sphere of influence, and I gain energy from providing an extremely high level of customer service. People take a risk when they work with a new agent, and it’s meaningful to surprise them with outstanding service,” says Farr.

Support and Camaraderie

 One of the biggest risks in starting your career as an independent agent is isolating yourself.

Boettger says, “It’s super important for new agents to find others who are experiencing the same things.  While our company’s training is outstanding, the real secret sauce is the peer groups who cheer each other on as they put the training into practice.”

Ryan Motz, an agent with C&S, found “it helpful to surround myself with a group of professionals (both inside the company and outside) who were pulling for my success. It’s like having a team without being on a team.

“I’m a control freak when it comes to my business, but that doesn’t mean I don’t want and need support from others.   Being independent with a strong support group is the best of both worlds,” says McCabe.

You Can Succeed as a New Independent Agent

The right person, with the right motivation and focus can still establish themselves as a new independent agent. It takes above average skills and competencies to have a chance to win, but even the best traits must be combined with the support of others.

If you’re not seeing an alignment between your talents and the concepts described above, you might want to seek out a different way to engage in the real estate industry.  Being an independent agent is not for everyone.

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