If you were to choose a real estate agent to sell your house, would you choose to list with a national franchise real estate brokerage or a local, independent brokerage? It’s likely that your decision isn’t completely based on this question. You’ll probably choose someone you know, someone your friend or family member used, maybe even someone from an advertisement.
The Franchised Real Estate Brokerage
As an independent local real estate brokerage, we look at the national behemoths as an oddity. Why would someone want to work for a huge brokerage? It’s not for the money. It’s not for the independence. Is it name recognition? Do those agents who choose to work at a national franchise brokerage feel they need that branding behind them to list and sell houses? Some stay for the training, I’m sure. However, if you’re long into your career, your work experience should be guiding you at some point, one would think.
The Local Real Estate Brokerage
I’m certain that the national franchise brokerages look at local real estate brokerages the same way, as an oddity. Why would some real estate agent want to work for a local real estate brokerage when it’s obvious that it is better to work for the franchised real estate brokerage? After all, you can be one of the hundreds of thousands who work for the 4 or 5 largest franchises. Look at the things national real estate brokerages offer their agents. Training! Technology! Oh Joy!
Think about the last time you went to a sit down restaurant with your family. Did you go to a national chain or did you go to a restaurant based in St. Louis or the surrounding areas? Maybe it’s an age thing, but I have been seeking local restaurants over the national ones for a while now.
Have you ever noticed what happened with the craft beer market? In the 80’s and 90’s the beer market was dominated by 3 or 4 national players. You got very bland versions of beer. The product had been considered as primarily a commodity…the only thing that mattered to consumers was price. Contrast that thought with the explosion of the craft brewery market in the United States. Thousands of new and different brands and flavors at all different price points have been created since the 90’s. Beer buyers tend to focus on factors now other than price.
Can This Happen In Real Estate?
While I’m hopeful that people would start to look at the local independent real estate brokerages, I’m not sure our industry is set up right to allow these brokerages to flourish. For one thing, most new agents are going to start out at the national real estate brokerage. After two or so years, those people have likely moved on to another career, so it’s only the remainders who would even consider starting their own real estate brokerage. Even then, stat licensure says you need two years of experience as a real estate agent before you could apply for a real estate brokerage.
There Are Opportunities
One of the reasons I started Deerwood Realty is that I didn’t like the national franchise model to begin with. As a real estate agent, a portion of the commission you earn goes to the real estate brokerage, and then that is funneled to the national franchise. What does that national franchise do with the money? A couple of things
- Build national marketing campaigns for brand awareness.
- Pay shareholders
- Design recruiting campaigns
If I am a local real estate brokerage, I’m not real interested in any of those three things. And there’s the opportunity. I can concentrate my business on working with friends, neighbors, and families. When you are looking for a home for sale in St. Louis County, I live here. I grew up here, and I understand the local market. No real estate franchise based in Colorado, Texas, or New York is going to pay attention to a home for sale in Webster Groves, much less know where it is. After all, there are national marketing campaigns to be making.