As a new North Carolina real estate broker, the first thing you’ll need to do after you pass your licensing exam is choose a managing broker (i.e., broker-in-charge). Don’t let the process of finding a managing real estate broker to work for intimidate you. How do you select the best managing broker for your new real estate career? We’ve put together five steps to help you choose a managing broker that’s right for you.
Step 1: Ask about the commission split
Most North Carolina real estate brokers get paid on commission. When you’re not selling, you’re not getting paid. But when you’re selling, you’re going to split the proceeds with your managing broker. Different North Carolina real estate brokerages offer different commission structures. (And some brokerages offer salaried positions, but these are few and far between.) While factors like company culture, resources, market share, reputation, and support will also come into play, you’ll want to pick a brokerage that offers you a commission split you can live with—keeping in mind that commission splits often get better with experience and sales volume.
Here’s how commission splits work: Let’s say you sell a $300,000 home and the average commission in your area is 6%. That 6% is first split between the buying and selling broker. Now you’re down to 3%, which works out to be $9,000. Next, you’re going to have to share that with your broker-in-charge. If you’re on a 60/40 commission split, you’re taking home 60% of that $9,000, or $5,400. Of course, this is before expenses and taxes.
What’s a good commission split? That depends on the business, your market, the managing broker’s support and resources, and a number of other factors. Just make sure you understand the split and how you might get a bigger percentage over time.
Keep in mind that some brokerages these days are offering real estate agents a salary and benefits, or a hybrid model, so you might want to shop around if this approach to compensation appeals to you.
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Step 2: Evaluate the brokerage culture
Before you choose a managing broker, ask yourself: What kind of company do I want to work for? How much support do I want from my coworkers? Just like other businesses, real estate brokerages develop a company culture that informs the way they do business. Are you looking for a small, mom-and-pop brokerage with an intimate, family-like brokerage culture? Or would you prefer a big-box franchise brokerage that’s more likely to let you fend for yourself? Are you looking for weekly get-togethers and company caravans on open house day? The best ways to know and understand a company’s culture are to chat with brokers who work there or attend a company function.
Step 3: Decide between a franchise or independent brokerage
When it’s time to choose a managing broker, another big question to consider is whether you prefer to work for a franchise or independent brokerage. Big-name brokerage houses like RE/MAX or Keller Williams have offices all over the country. A mom-and-pop brokerage might have been serving a single North Carolina community for generations. Franchises tend to exert more control over their brokers than an independent firm, but they usually offer more support and training. Independent firms are usually locally based and consist of a small- to mid-size team. The benefit of working for an independent brokerage is that you have more freedom to conduct your business the way you want to.
The National Association of REALTORS® reports that the majority of REALTORS® (53%) choose to work for independent firms. If you relish your independence and dislike corporate culture, an independent North Carolina brokerage may be the way to go. The main advantages of a franchise are the many resources they offer in terms of information and marketing support—and the name recognition.
Step 4: Learn its reputation and niche
When you start your research, begin with a simple Google search as if you were a buyer. Search for “homes for sale in [community name]” and see who comes up. You want the brokerage you select to have a strong market presence and a quality reputation. If they have a high market share, you can depend on them to help you find leads. And we all know how important a brokerage’s reputation is.
Just as important is the niche your brokerage is in. Studies show that the right brokerage can triple your real estate income. The right real estate niche for you will probably be a combination of your interests, lifestyle, and the opportunities available in your area.
Step 5: Make sure it will offer support
Some brokerages are very hands-on and offer extensive mentoring, free training, and marketing collateral. Other brokerages are just places to hang your hat while you get to work growing your own business. You might take the occasional sales training class or meet for a monthly brokerage meeting, but otherwise, you’re on your own. You’ll find many variations between the two extremes, and it’s largely a matter of finding the corporate culture that you prefer.
When you’re ready to choose a managing broker, keep these considerations in mind. Finding the right brokerage involves research and interviewing. Don’t be afraid to sit down with several North Carolina real estate brokerages in your area to see who fits the best with your learning style and business goals.
Why it’s necessary to choose a managing broker
Why is managing broker selection so important? In your first year as a North Carolina real estate broker, you’ll have a ton of questions, uncertainties, and getting-your-feet-wet experiences. You’ll need to choose a managing broker that will be there with you each step of the way.
When you’re first starting out, you won’t have the funds to compete with the big real estate brokerages when it comes to marketing, lead generation, and conversion. You’ll need a broker-in-charge’s help getting your name out there, and you’ll want to use their tools and systems to kick start your career.