The question of whether or not to join a real estate team is one that comes up in the business on a daily basis. Many brand new agents, as well as experienced agents, if not achieving the level of success they’d hoped for, often consider joining a real estate team. Agents find themselves challenged by managing tasks and prospecting for clients, all while attempting to learn to be efficient in all of the above. They assume that joining a team is the answer to their problems, but is it? Typically, agents need leads, accountability, training, and branding. Let’s review how each of these are handled on a team.
Typically the motivation for starting a team is that there is more work and more customers than the team leader can handle. He/she forms a team and assigns the work he doesn’t like to do, and the prospective customers he doesn’t want to serve, to the team members. In exchange, the team members will share with the team leader a considerable portion of their commissionable income and leads for realtors on the team.
Since a team leader is sharing leads, he expects team members to follow up with them on a very systematic and consistent basis. He will typically develop very specific protocols for what is said and how often each lead is contacted. From this perspective there is typically tremendous accountability on the part of the team member to follow up and close the Team Leader’s leads. The team will typically utilize customer relationship software that makes this follow up simple and transparent to the leader.
Next, there is training. Training takes time, which is often the last thing a team leader has, which again, is the reason that he formed a team in the first place. Training that is advertised and training that is received are often inconsistent. “On the job” training is typically more the rule than the exception in most high-producing teams.
Especially for new agents, branding is a key component of growing their business. People do business with those who they deem trustworthy. A large national brand brings instant credibility and trustworthiness, but a small or individually-named brand does not. While some teams are part of a national brand, the team leader will often choose to push their own personal name as their brand. That’s because the team leader understands that real estate is a relationship business, and he wants customers to think of his brand when they are making decisions about real estate.
Pros and cons of real estate teams
Pros: It is difficult to get started in the real estate industry. Surrounding oneself with a group of people all trying to accomplish the same thing can be comforting. Often, solo agents feel lost and overwhelmed when they start building their own business. High producing teams often have enough work to help guarantee an agent some income.
Cons: The cons of working on a real estate team are many. Here is a list of points to consider: 1) Real estate team commission is split between the team members and the team leader; 2) a great deal of an agent’s time is spent working with clients that are less desirable than those of the team leaders; 3) the agent is expected to bring his own clients to the team and to also share in the commissions derived from that work; 4) the team can be a bit of a trap as all of the work is spent in developing the team leader’s brand and not the agent’s; 5) while having a boss is a good thing in some instances it is often not the expectation an agent has when they get into the business.
What is the structure of a real estate team
A real estate team typically consists of a team leader, a transaction coordinator, and team members who are typically buyers’ agents. A team may also include a lead manager depending on the size of the team. The team is structured so that each of the team members directly report to the team leader. In this relationship the team members are essentially employees, and the team leader is the boss.
How real estate teams work
Teams typically function as a group of transaction-managing members with a marketing or lead-generating leader. Another way to look at it is the team members are like honey bees out foraging for opportunity or leads to bring back to the team leader who functions like the Queen. The team leader decides how the employees or team members are compensated and and how they spend their time.
How to build a real estate team
The first step in building a real estate team is to generate sufficient work or customer transaction volume so that additional members are needed. This is typically done through a social network system, a lead management system, and customer relationship management software. Once the sphere of influence exceeds an agent’s ability to service leads and clients, forming a team is a likely option.
Successful team leaders are excellent at Process Management, and establish thorough and thoughtful systems so that service is replicable and produced on a consistent basis. Team leaders will often deploy virtual assistants to help their agents work efficiently. Depending on the real estate market, working on a real estate team will often involve working with a listing coordinator, a listing specialist, a buyer specialist, and other full time real estate agents who comprise the real estate team.
What is an alternative to working with a team
The most important question often isn’t whether or not to join a team. The most important question is what type of organizational structure will be best for a specific agent. Before an agent settles on joining a team, they should consider looking for a national brand with a local broker. Find one who is actively involved with the development of their agents. Look for a company with the resources to help an agent be efficient, specific training and coursework that will help the agent continue to grow, and who share company generated leads, to help ensure the agents’ income goals are met. A great example of this type of organization is Century 21 Northwest in Phoenix Arizona.