- Invest In The Right Tools and Resources
- Platform-Building Tools
- Superior Visuals and Graphics
- Making Your Brokerage Mobile Accessible
- Hire Agents to Guide, Rather Than Manage
- Frequently Asked Questions About How to Grow A Real Estate Brokerage
Real estate brokerages face numerous obstacles when growing their business. One of the biggest challenges is fostering individual agent success.
Though the number of real estate agents is growing by 3% year-over-year, around 87% of agents quit within their first five years. Why such a high percentage? One reason is because starting off in real estate is tough, and most agents aren’t prepared for the obstacles and expenses.
On top of that, brokerages are struggling with time management and typically have a constant need to train agents. They may also be working with antiquated technology that’s holding agents back from producing at a higher rate.
Once you understand the levers that lead to growth and success, you can allocate more time and energy to them. Keep reading for our five recommendations on how to grow a real estate brokerage.
Invest In The Right Tools and Resources
Long gone are the days where a pen-and-paper list of prospects was enough to drive business. One of your specific goals should be helping agents master content marketing and lead generation by embracing email marketing tips and the right tech tools.
It’s not enough to pick tech tools at random, though. You need to choose software that makes lead generation and follow up simpler. What works for an accountant or warehouse manager will be different from that of a real estate agent or broker.
You also need to know when to invest in people rather than another shiny object. Different tools and types of talent accomplish specific objectives for your brokerage. Here are the best areas to concentrate your efforts:
Platform building refers to marketing activities or tools that attract and retain your own audience. Creating an email list or a list of SMS subscribers are two examples of platform building. Once users have joined your email list, you don’t need to rely as much on other platforms or strategies to reach the right people.
You need at least one platform-building tool when you’re learning how to grow a real estate brokerage. It gives you the freedom to contact your subscribers with valuable information whenever it’s most relevant.
Sending out emails and texts to your list is much more effective than paid marketing, too. Where your competitors may be spending thousands on social media ads, you can generate supporters who stick around longer.
Email subscribers are also more likely to be engaged. 71% of email users check their inbox before any other platform each day and they’re over four times more likely to buy a product or service than social media followers.
Building an email list as a brokerage helps both you and your agents. You can offer a lead magnet for new email subscribers, which is a free downloadable resource in exchange for their email address.
As more people join your list, you can segment your audience into related groups. These segments may be first time homebuyers or experienced homebuyers. Then, following up through email with the right message builds the relationships that your brokerage needs.
Superior Visuals and Graphics
Having top-tier visuals for your brokerage is a 21st century must. Real estate itself is a noticeably old industry, dating back to the 1800s in the United States. If you want your agents to reach modern-day consumers, your brand graphics need to communicate that.
The Internet has ushered in a new age of subconscious graphic design expectations. Consumers aren’t just looking for professional imagery anymore. They want to connect with brands that are flexible and ever-growing–and they’re able to detect which brands are the real deal.
Take time to assess your brokerage’s existing logo and graphics. Do they come across as traditional, or even old fashioned? You may not be reaching the people you want to.
Buyers today want a dynamic experience, where listings are updated in real time and customized to their preferences. Your brand graphics need to communicate these expectations within the first three seconds, which is the amount of time most people make a decision.
Instead of outsourcing your graphic creation, hire an in-house designer if you haven’t already. Every business has a unique brand story, and it’s never been more important to understand yours and convey it accurately. So much of branding is visuals, hence the emphasis in this section.
Brainstorm phrases and concepts that you want your ideal customers to associate with your company. Then share your ideas with your graphic designer. They will afford a level of depth and quality that can’t be duplicated when outsourcing.
While brand visuals may not seem like they’re a high priority, data demonstrates otherwise. As much as 74% of consumers say a brand’s visuals are helpful or extremely helpful in deciding whether to buy. This is as true of real estate brands as it is of other goods and services.
Making Your Brokerage Mobile Accessible
The world has gone mobile and it isn’t going back. Roughly half of global Internet users access the web through a mobile device, and this number increases by 3% or more annually.
In order to compete against other brokerages, you need to have a mobile-first customer experience. This includes everything from the agent onboarding process to helping homebuyers find properties.
These kinds of features are essential when reaching Millennials and Generation Z. As of 2021, Millennials are the largest home buying demographic in the United States, representing 37-38% of all buyers. This group was also one of the first to experience on-demand products and services through the Internet, and which will drive buying preferences for years to come.
People don’t always feel the need to tour a home before buying it anymore. In fact, as much as 45% of homebuyers purchased their new place without seeing it during the COVID-19 pandemic. Just a few years ago, such a thought would have been ludicrous. Now it’s par for the course and creating new opportunities for real estate leaders.
Work with your team members or hire a skilled developer to ensure your agents have what they need to succeed. Home buyers and sellers should be able to find and contact your staff easily through your website and mobile app. The top-level navigation should be intuitive and not require advanced understanding of Internet technology.
It should also be simple for prospects to contact an agent. If it takes more than two or three steps to submit a contact form or share information, consider revamping the process. The less time prospects need to spend before they’re meeting with an agent, the faster your brokerage will grow.
Hire Agents to Guide, Rather Than Manage
Access to the Internet has forever changed how most people shop for things. Instead of getting in your car to drive to a brick-and-mortar store, you can browse everything online. Nearly every industry imaginable has gone partially or fully digital. In order to remain relevant in the years ahead, your brokerage must adapt too.
This means your agents play a consultative role more than a top-down one. In other words, home buyers and sellers want to be guided through the process, rather than managed.
How can you pivot to this approach? By training your agents on relationship selling techniques. Asking open-ended questions, building trust with your clients, and asking about new clients’ ideal outcomes are hallmarks of successful companies.
This is the mindset increasing numbers of homebuyers are already in when researching the best time to sell a house or buy one. They don’t want someone who coldly dictates each step to them–they want a professional with helpful insights to offer.
Over time, your agents will become more experienced and understand how best to engage with new clients. Conversations throughout your brokerage will become far more natural as your agents point to their listings as the natural answer to clients’ needs.
Frequently Asked Questions About How to Grow a Real Estate Brokerage
Being a real estate agent comes with challenges, but running a brokerage comes with more. Given how many options buyers and sellers have these days, it’s no wonder brokerages are fighting to stay profitable and successful.
To help your business not just survive but thrive, we researched the following questions people are asking about brokerage growth. Take a look at our answers below:
Is Owning A Real Estate Brokerage Profitable?
Due to several factors in every brokerage, it’s difficult to say whether or not owning one is profitable. More experienced realtors have already learned which pitfalls to avoid, which makes it easier to profit in a shorter period of time.
On the other hand, simply starting a brokerage to make more money doesn’t always pan out. One must examine the details that lead to brokerage profitability. Here are the factors to start with:
- Experience level of your agents. Do the agents you hire have more experience than others? Are you hiring agents with a variety of experience? This hints at how many deals your brokerage can expect to close per year. More experienced agents will close deals faster and at higher profit than less experienced ones.
- How many agents you have. It’s simple math that a brokerage with 50 agents will become more profitable than one with 10. The former agents will come across more buyers more often, and that will lead to higher close rate. Though it’s not always best to bring more agents on strictly for sales numbers, it can increase the number of prospects your agents find.
- What amount of money is deemed “profitable.” $1,000 counts as net income in the same way that $1,000,000 does, but most people wouldn’t look at the former as profit. If you’re investing thousands of dollars into a business but only making a little bit back, is that worth it? Most would say no–making this an important factor to consider. Map out anticipated expenses and profits for the first 5 years. If you can’t project enough profit, you need to adopt a different business model.
How Much Does It Cost To Start A Real Estate Brokerage?
Given how widely brokerage goals and expenses vary, it’s impossible to standardize brokerage startup costs. However, most brokerages that plan to hire multiple agents will need between $8,000 and $45,000 to get going.
The majority of these costs are office rentals, equipment fees, marketing costs, and construction. If you’re using a commercial office you need things to look professional, and this is no small expense.
On the other hand, if you’re starting a small brokerage with top producers, you won’t have as many expenses. You could pay for a small office, some insurance, and basic office supplies for less than $1,000 per month.
The costs you incur for your brokerage depend on your goals, existing capital, and how quickly you want to grow. A brokerage that wants to close dozens of deals in its first year will need to attract strong agents early on, as opposed to one growing at a slower pace.
How Do You Buy A Real Estate Brokerage?
Buying a real estate brokerage is a significant undertaking. You’ll need a few things to accomplish it, including a brokerage or franchise for sale, funding, and support staff contact info.
First, look for real estate brokerages for sale. Existing franchises like RE/MAX and Keller Williams are among the most recognized real estate brokerages today.
Second, ensure you have sufficient capital. While franchise costs differ based on brand, you’ll often need between $15,000 to $50,000 to start. Some brokerage franchises cost $100,000 or more, which is based on varying factors.
Research a brand’s typical franchise cost before starting a conversation with them. Remember to budget royalty fees into your expenses, too. These are gross revenue fees that a franchise pays to the brand owner on a monthly or annual basis.
Third, make sure you know who you can contact in unexpected circumstances. Where independent brokerages must address unforeseen troubles alone, franchising affords the benefit of speaking with brand staff. Before striking a deal, make a list of people you can reach in difficult situations. It will likely save you time and money.
When the above matters are addressed, all that’s left is inking the deal. Having strong training and marketing efforts in place to boost your new franchise is also a wise call.
A Growth Mindset Is The Key to Success
Taking your real estate brokerage from sustainable to impeccable is a true challenge. It requires a broader plan to recruit excellent agents and reach sellers and buyers by innovative means.
Most of all, it takes putting people first. Understanding the needs of your agents, as well as those of their buyers, makes you noticeable in a sea of competition. Using the ABCs of relationship selling consistently maintains that competitive edge. Continue leading by example and before you know it, your brokerage will be breaking company records.Back to Top