How to Open a Real Estate Company
Even during tough economic times, some Realtors have decided to open real estate offices of their own. In a 2006 Realty Times article, Blanche Evans says, "Agents believe they can swim upstream against established local competition and the franchise consolidation current and open their own mom and pop realty shop." Many who venture out on their own fail, but you can take steps to ensure your real estate company is successful.
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Instructions
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Hire only the most talented and productive agents. Realtors who are new to the business or less than productive can be detrimental to a new company. This is not the time to train new agents; all agents hired during the first year of business should have a successful record of selling real estate. This can be verified through the multiple listing service (MLS) of your local Realtor board.
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Introduce your firm to the neighborhood. This can be done through person-to-person contacts, direct mail, holding an office open house and newspaper advertising, according to Realtor.org. Clients can also be found by asking for referrals, contacting previous customers and participating in networking opportunities such as mixers and local chamber of commerce meetings.
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Keep your office open and profitable. Many businesses fail within the first year of operation, but you can tip the odds in your favor by being practical and realistic. Continue to ensure each month is productive. This can be done by taking an active role in coaching each agent in your office--even if they have years of experience. Brokers need to ensure that their agents are informed of any changes in real estate laws, up-to-date regarding industry news and developments, and constantly motivated to list and sell properties for the company.
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Tips & Warnings
Know the fundamentals of the real estate profession before trying to start a real estate company. This means having worked as an agent, Realtor, or broker for at least three years.
Understand the costs and expenses involved in opening a real estate company. Offices expenses, monthly rent and how much to pay agents are all critical elements. RE/MAX International, for example, uses the "desk fee" model and requires agents to pay a flat fee each month to help cover expenses. Other companies pay all of the overhead costs while paying out smaller commissions to agents.
References
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