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Firm Affiliation of REALTORS®
- 53% of REALTORS® are affiliated with an independent, non-franchised company.
- While brokers and broker associates (60%) are most often affiliated with an independent, non-franchised company, sales agents are split more evenly with 49% belonging to an independent company, 46% belonging to a franchised company, and 5% reported as “other.”
- Less REALTORS® reported an affiliation with a franchised company (42%) than with an independent company (53%).
Source: National Association of REALTORS® 2021 Member Profile
Franchises: The Basics
What is Real Estate Franchising? (MillionAcres, Apr. 8, 2021)
Real estate franchising allows REALTORS® to start their own business but benefit from the already existing brand awareness of a larger company. Franchising, which occurs in almost every sphere of business, is perhaps most well-known in the restaurant and fast-food industry. Traditional franchises usually are comprised of a broker/owner and an office of agents, but the real-estate world also has home inspection franchises, property management franchises, and even estate sale franchises.
@Properties Picks Detroit Brokerage for First Franchise (The Real Deal, Feb. 16, 2021)
“The six-year-old Alexander, which has offices in Detroit and the Michigan suburb of Royal Oak, tallied $140 million in sales volume last year, according to partner Eric Walstrom. He said the firm expects to open eight new offices by 2026, according to the report. The news follows @properties’ late September franchise announcement. Co-CEO Thad Wong said then that its goal was “to become the fastest-growing brand in the country.”
How to Buy a Real Estate Franchise (The Motley Fool, Oct. 3, 2020)
“Starting a brokerage is a big decision. In order to have a successful brokerage, you'll need to be in an active market and hire experienced agents who hopefully already have an existing client base. You'll also need support staff, including marketing and transaction coordinators. You may also need to rent an office, although that isn't always the case in today's market.”
Independents: The Basics
Big Dreams, Small Brokerages: Five Traits of Independent Firms Real Estate Agents Should Consider (Forbes, Feb. 17, 2021)
“At some point, every agent must make a tough decision: to work for an independent firm or a larger, franchised brokerage. According to the National Association of Realtors, as of 2020, the number of agents working for independent versus franchised brokerages was nearly evenly split. Of course, this doesn’t mean that all brokerages work for agents in the same way.”
Pulse: The State of the Indie Broker Going into 20201 (Inman, Dec. 01, 2020)
“Why not use a local company if you get the emotional and community benefits of hiring local — on top of the same great service and performance? The key for indies is to make sure they’re doing a great job, just like any successful broker would need. Then, consumers will always prefer local over corporate. It’s an easy sales pitch as long as you truly stack up in what you offer compared to a box-store brokers’ offering, which isn’t hard.”
Greenville Group Launches Real Estate App to Compete Locally with Zillow (The Post and Courier, Nov. 28, 2020)
Quitchet, a new real estate app created by an agent in South Carolina, hopes to act as a local competitor to Zillow. The program, which was created by Bob Morgan of Greenville, uses the local MLS to allow buyers to browse and even schedule appointments. Quitchet is intended to be very local user friendly – it displays no ads and even features Clemson orange.
The ABCs of Opening Your Own Brokerage (REALTOR® Magazine, Jun. 26, 2019)
“Ramonica Caldwell, broker-owner of Ramonica Caldwell Real Estate Group LLC in Houston, opened her brokerage mainly for the freedom. She, too, decided to go independent to control her own brand and business identity. Today, she operates with two agents. “I always knew I wanted to have my own company no matter what job I was going to do. I always wanted to be an entrepreneur. I’m normally a go-getter in everything I do,” she says. In May 2017, she opened her doors after working the previous five years as an agent with different types of real estate brokerages.”
Franchise or Independent: How to Choose?
RE/MAX Broker Shares His Journey from Independent to Franchise Model (RIS Media, Oct. 15, 2021)
John Noughton, a Broker/Owner in New Hampshire, was an independent real estate agent looking to grow his business. He realized that, for him, the best way to put his agents first and provide them with the tools, technology, and marketing needed to achieve the growth he had in mind was to become part of a larger franchise. Brand recognition is huge, but making sure the culture of that brand fits your agents is sometimes even more important.
How to Choose a Real Estate Company to Work for (Fit Small Business, Aug. 19, 2020)
Choosing a real estate brokerage to join is personal, but there are some major differences between firms that can make your decision easier. First, figure out what type of firm first your life style and professional skills: a national franchise, a boutique brokerage, or a virtual brokerage. Next, decide between working solo or joining a team within the office. Finally, compare commission splits, fees and contracts.
The Real Trends 500: Ranking the Top Brokerages in the U.S. (REAL Trends, Mar. 25, 2021)
“The RealTrends 500, now in its 34th year, remains the undisputed leader in ranking the performance of residential real estate services firms. Due to the requirement of independent verification, the RealTrends 500 is The Trusted Source for information about performance of these firms. “
Pros and Cons of Buying a Franchise (The Balance, Jan. 3, 2020)
There are pros and cons of both franchising and remaining independent. Though brand name franchises can be expensive, they are also the cheapest opportunity many will ever have to own their own office. Franchises may require extra payments either upfront or on a regular basis of some sort, yet those payments are often paying for things tools and marketing that will boost your brand, in turn possibly making you more money. After doing research, make the best decision for you!
Buying a Franchise: A Consumer Guide (Federal Trade Commission, Feb. 2008)
eBooks & Other Resources
Books, Videos, Research Reports & More
As a member benefit, the following resources and more are available for loan through the NAR Library. Items will be mailed directly to you or made available for pickup at the REALTOR® Building in Chicago.
Consultant & Independent Contractor Agreements (eBook)
Creating An Independent Income In Real Estate! (eBook)
Free Agent Nation (eBook)
Real Estate Confronts the Future (Thompson South-Western in association with RealSure, Inc., 2005) HD 1375 SWCR
Business Lessons for Entrepreneurs: 35 Things I Learned Before the Age of Thirty (Thompson South-Western in association with RealSure, Inc., 2003) HD 2346 C89
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