“Ready. Set. Grow,” is the tagline at this year’s National Association of Realtors’ conference, now known as NAR NXT. As agents from across the country look to grow their business, even when facing slowing buyer demand and seller reluctance to list due to rising mortgage rates, many are looking at teams as a way to expand.
According to analysis of data from the 2021 RealTrends 500 top brokerage firms and RTC Consulting benchmarking data, teams of all sizes have average gross margins more than double the average brokerage firm.
“Many believe that teams were the foundation of real estate brokerage firms some 60 years ago,” Steve Murray, senior advisor for RealTrends, told HW Media last November. “Back then, principal brokers who formed a company recruited agents to help them take care of referrals.”
After a few years in the real estate industry, Shay Hata said she was feeling a bit overwhelmed and burnt out. So, the Chicago-based Berkshire Hathaway agent decided to start her Buy Sell Love Chicago Team.
“We got into this job to have a good life, this shouldn’t be our life,” Hata told NAR NXT attendees gathered in the Valencia Ballroom on the top floor of the Orange County Convention Center in Orlando, Sunday morning.
Hata noted that a good way to tell if you were in a position to start a team was if you were already doing 40 or more transactions a year and having even more leads come in than you could handle, and if you notice that you are so busy that your customer service was suffering. For Hata, this moment came when she finished a closing and realized she had forgotten to order a home warranty for her buyers.
“That never should have happened,” she said. “To me that says you are too busy and that you don’t have the right systems and support in place so things fall through the cracks.”
While Hata highlighted the many benefits of starting a team, including being able to lighten some of your workload by bringing in administrators and improve your business by really nurturing your strengths as an agent and business person, she also noted things agents should consider before starting a team.
Some of these items included analysis of their leadership skills and whether or not they wanted to take on more of a managerial role, while others were more practical matters such as whether or not they would need their own E&O insurance or if their brokerage’s policy would cover the additional agents they brought on.
Once an agent has decided to start a team and come up with a team structure they think will work for them, Hata warned agents that they shouldn’t be in a rush to hire team members.
“Be slow to hire and quick to fire,” Hata instructed.
However, for the administrative assistants and agents team leaders wish to retain, Hata said providing systems for agents to effectively and efficiently close transactions was key.
Barb Betts, broker and co-owner of The RECollective, a Long Beach, California-based “teamerage,” agrees: “Agents come to teams and stay with teams because they want support and they want systems.”
For Betts, who started her teamerage, or her “brokerage that functions like a team,” five years ago, this means that the brokerage pays for and provides everything an agent needs to generate business relationally, while the agent pays for all of their membership fees and insurance.
Betts made the decision to venture out on her own and set up her teamerage after she became dissatisfied with the culture at the national brokerage franchise she was at. According to Betts, by developing her own teamerage, she was able to create the company culture she wanted. In addition, she said that her agents “got the opportunity to gain independence while keeping all of the benefits of a team.
“I want my agents to grow with me not out of me,” Betts said.