Owner and Qualifying Broker at Rhino Realty Property Management and Rhino Realty B&B, entrepreneur, investor, advisor, author and speaker.
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Is working for a big-box brokerage the way to go for you in your real estate career? Or are you better off building your own pipeline with a smaller boutique firm? Answering these questions is never easy, so if you are venturing into the real estate world for the first time, or pondering a change from your current company, here is some food for thought.
Are you a team player or a lone wolf?
Understanding your personality before you get into real estate is crucial for your success. It also doesn’t hurt to learn more about yourself, even if you have been in the business for an extended period of time. It’s not uncommon that your idea of a team, or of working alone, can be far from reality once you get going. Being honest with yourself about how you operate can save you a lot of grief and headaches.
A great way to determine answers to these questions is to take a personality test. It’s not uncommon that you may think you’re of a certain personality type when the outside world interprets you in a very different way. There are several personality tests out there that offer great outlines and insight into what environment you could potentially operate the best in, and many of them are free. I have used the 16Personalities assessment many times for new brokers, staff and myself. Personality testing is also a great tool for hiring and can help guide the best person into the right position.
Do you prefer training or on-the-job experience?
For new brokers, one of the biggest “carrots” that the big-box firms tend to offer is the vast and robust training they provide. The idea is that it’s better to have a well-trained employee in the field writing up offers to help mitigate legal risk than an untrained employee who might land the firm in a lawsuit. It’s a sound position indeed and, for many, a justified and necessary incentive to feel comfortable to get into the flow of their real estate career.
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On the other side of that coin will be the fee split that is taken out of each commission. Many times this can be 50% or more, leaving some to question how fair the splits truly are. Personally, I never could justify giving up half of my hard-earned commissions for anything and went to a boutique firm that trained me as I went. Early into my career, I hit a hot streak and had over a dozen clients all at once, both buyers and sellers. I would be lying if I said I was not anxious and overwhelmed, so I asked my qualifying broker if I should focus on the best leads, work through them one at a time or take them all on at once. In true QB fashion, he responded, “Take them all! If you get stuck or have issues, just let me know, and we will get through this together.” Within 60 days, 10 out of the 12 closed, and I retained 80% of my commissions and was on my way to being one of the top brokers in the firm.
Looking back, it was like drinking water out of a firehose at times and, on several occasions, I tread on very fine lines in regards to technical and contractual requirements. Fortunately, I had a very skilled and experienced QB who was able to help navigate the several moving parts each deal required. Was it worth it? For my personality, I would have to say absolutely. However, if you don’t know your thresholds, getting into a similar situation could be catastrophic and open you and your broker up to liability.
Knowing yourself and whether you work better with or without formal training is important to consider. If you’re a more experienced broker, you may initially reject the idea of training; however, if your business has not developed the way you envisioned or you feel like you need more direction, there is nothing wrong with doing your research and seeing if additional training and support are a good idea.
Do you ‘rah-rah’ or nah?
Another consideration is how much you enjoy team spirit and how important a company’s brand recognition is to you. Many of the larger firms enjoy quarterly gatherings, retreats and conventions and are highly recognizable nationwide. For many, this is just what they deem necessary to help propel their careers and justify the higher splits.
The downsides can be the cliquish mentality that some of these teams can produce or the brand being slow to modernize for today’s aggressive and ever-changing marketplace. If you’re a self-starter, highly motivated and consistent, you may prefer to avoid big-box firms. In many cases some of the biggest producers of these large firms end up going solo after a period of time, realizing that as real estate professionals, we can be our own greatest asset.
There is no perfect, one-size-fits-all route, and whether you are new to the real estate game or have been at it for some time, all options mentioned are advisable to consider. Looking at all avenues, being honest about your personality and determining if you learn better live or on the fly are all fundamental steps toward a productive and enjoyable real estate career.
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