Many real estate agents wonder what it would be like to have their own brokerage. There are a number of benefits that come with being in charge of an organization, but this also means additional responsibilities. While you’ll often earn more, if you’re thinking about becoming a broker for the sole purpose of increasing your income, you’re not approaching it for the right reasons; however, if you want to build your own brand and create a unique company culture, it may be for you.
Here are four considerations to make when determining whether to branch out into your own brokerage.
- Types of Brokers
Designated brokers, or broker/owners, are legally the ones in charge of a brokerage. By law, they oversee the transactions handled by those at the firm; however, their role can be much less involved. Designated brokers are able to manage the branch or hire another broker or group to take care of maintaining the everyday responsibilities.
Managing brokers take a very active role in the brokerage. They are the supervisors, and are responsible for all day-to-day actions, such as hiring agents, training staff, holding meetings, and overseeing advertising.
If you’re unsure about whether you would be able to maintain all of the responsibilities of a managing broker, being an associate broker may be a good starting point. While the associate broker has the ability to open and run a brokerage, they choose to work under a managing broker, performing the same responsibilities as an agent; however, with the added experience, background, and education, these brokers are considered to be more knowledgeable.
- Requirements to Become a Broker
Before making any decisions, it’s important to understand the requirements involved in getting a broker’s license. The requirements vary by state, so it’s important to check your local regulations. All require you to be at least 18, but some states require you to be older. Also, each state requires you to go through pre-licensing coursework and pass the broker exam.
In addition to this, you must have experience as a real estate agent. The amount of experience varies by state, but most require at least two years of experience. Some states measure your experience through a point system. For example, in New York, agents must have at least 3,500 points of experience. In this case, residential real estate transactions are worth 250 points, while completing a rental transaction is worth only 25 points. If becoming a broker is something you’re planning on, it’s important to consider each of these requirements to help you better prepare for the next step.
- New Responsibilities
As an agent, you’re able to turn to your brokerage for support when you need it. When you become the managing broker or broker/owner, you are the support. Brokers are responsible for maintaining a flow of clients for agents to serve, generating properties to market, staying up to date on market conditions, supporting and maintaining the physical office, hiring office administration staff, and more. In effect, brokers are the ones holding the office together. While this can come off as a great advantage to many, keep in mind that brokers are also responsible for networking to keep business moving. This can often mean scheduling hours around social events and extended work days to meet with potential clients or vendors.
- Build Your Own Image
One of the key reasons why agents become brokers is because they want to develop their own brand image and foster a company culture that fits their personality. When branding is done properly, it can turn clients into loyal followers who will happily refer your business. Because of this, it’s important to consider what kind of impression you want to create. Consider your target audience and what you want them to see in your brand. When you’re ready, create a database of who you’d like to work with (or who you currently work with), so you can begin reaching out to develop contacts. As you consider your image, you also need to decide how you want it reflected in the branding that will be displayed in places like advertisements, your website and your social pages. Create a clear and defined mission and begin promoting.
If you’re convinced that being a broker is right for you, start taking these steps in the right direction. With planning, you can build a brokerage empire that fits your personality and your standards.
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