Jay O Brien
By Jay O’Brien
We’ve all received the calls, opened the letters, and deflected the in-person pitches. Real estate is perhaps one of the only industries that attains its workforce through blind recruiting rather than interviewing.
It’s quite simply a numbers game for many brokerages, and the strategy becomes less about value creation for agents and more about the bait.
How do brokers attract more agents and (hopefully) retain them? Unfortunately, the most common misconception is the one that revolves around what truly motivates people: money. If money is truly the greatest motivator, the success of real estate agents would be through the roof since selling a home is the one and only way to get paid. Clearly, this is not the case. But when agents are looking to make a switch, we still hear the question time and time again: “What’s the commission split?”
This is not the question you should be asking. Let’s not forget, 90 percent of zero is still zero.
@Yoel, 2014. Morguefile
The relationship between a brokerage and an agent should be mutually beneficial, and monetary rewards should not be top priority. Don’t put the cart before the horse. First, start by asking yourself these questions:
- “What has my business looked like in the last year?”
- “Did I do more business each year? How much more?”
- “What are my biggest challenges right now?”
- “Where do I need coaching?”
- “What are my goals for this year, and the next, and the next?”
If you do not know the answer to all of these questions, how in the world is your broker going to know?
In such a heavily self-disciplined environment, it’s very easy to notice when a real estate agent becomes complacent. If there is a problem, struggle, or challenge, it’s very difficult to identify it and face it alone. Instead, an agent is more likely to think they are in the wrong office or behind the wrong brand. They might think an office change will correct their productivity.
It is paramount for an agent to position themselves with a person, or people rather than a brand, company, office, etc. The genuine growth of a real estate professional cannot be quantified in purely commission splits. Remember the saying, “You get what you pay for?” Often, if the commission split ratios are dramatically skewed in the favor of the agent (especially from day one), then usually there is very little value being added from the brokerage. It’s simple business 101: You can’t spend more money than you make.
I am constantly looking to grow in various aspects of my own life, so I have a personal coach for several things: golf, yoga, CrossFit, AND business. If an office has promised you the moon and the stars along with a compensation plan that is too good to be true, something probably doesn’t smell right. I would venture to guess that most agents reading this would agree that doing 25 deals a year at 75 percent is much better than doing two at 90 percent.
With that, find your person, your mentor. Find someone who can hold you accountable and coach you to greatness. It is absolutely critical to your success. Take that path, and watch the money follow.
Jay O’Brien is a managing partner and co-owner of RE/MAX Prestige in Costa Mesa, Calif. Connect with Jay at www.jayobrienrealestate.com or firstname.lastname@example.org.