It’s a long-held industry tenant that real estate agents primarily switch brokerages during the bad times—yet over the past year the industry has seen tremendous numbers of agents jumping ship to competing firms.
At a recent national industry event, several interesting insights were shared regarding how market share has recently changed for agents:
– The top 20% of agents had a huge five percent average increase in their market share while the agents in the bottom 20% were unchanged. Most telling, those agents in the middle representing 60% of the production, had the largest drop in market share
– Agent teams are growing significantly, and they are changing brokerages, taking a fair amount of market share with them
– The southeast region is seeing the most agents changing firms with an estimated agent migration that will surpass last year’s by 70%
There have been signs of industry slowdown, but as June is traditionally one of the industry’s best months, I suspect most brokers didn’t notice the shift. However, recruiting remains a top priority and an ongoing process for the best companies. Don’t assume that just because the market is busy that an agent isn’t thinking about making a move, either based on their recent production or because of other circumstances.
Brokers this month shared some of their experiences on why agents change companies:
Inventory– “Agents are going to where they can get access to the inventory. We have seen really good agents leave their current broker to go where there are more listings and synergies. It’s a sign the firm has the resources needed for agent growth when a brokerage has large producers and top teams.”— Jacob, Florida
Market position– “I have seen good agents leave good companies when the types of properties the brokerage sells changes. The brokerage may be selling properties that are priced all over the board hurting the reputation of the firm and making it harder to get the coveted higher priced listings.” — Allen, Colorado
Culture– “It’s not just about the money. Top agents often want to be with a certain group of performers, they like to be with successful peers for collaboration; or conversely, maybe good agents have left over time making the atmosphere different; a firm’s culture has a lot to do with agent turnover.” — Valerie, North Carolina
Broker support– “Access to the broker for ongoing support is a huge reason that agents leave. Over the past year, we have recruited almost three-dozen producing agents from competitors who had very little interaction and communication with their too-busy broker.” — Eric, California
Commissions– “Often it is about the split and personal income. If we can show a prospective recruit a higher split with full support, marketing and technology, it is a major factor in switching to a new brokerage.” — Steve, Texas
Misaligned goals– “We had a major team move to us because they didn’t think the goals of their prior brokerage aligned with theirs. The company was coasting with a lack of direction. A lot of new and inexperienced agents were floundering, and there were no plans for changing technology, tools and resources because the broker was focused on his personal production.” – Cynthia, Virginia
Value– “If the agents are paying fees and expenses, there has to be value. Are they getting their money’s worth in return for what they are expected to pay?” — Matt, Chicago
Synergies– “Agents like to be where the action is. They like to be a part of the activity, seeing their broker’s signs everywhere, excitement in the air and a lot of agents doing deals. It draws good agents who feel they would be happier and better off. Agents need to feel they would be better off with us than without us” — Hilary, Florida
Appreciation and recognition– “To be truly successful in this business takes a lot of work and long hours. Agents can often be taken for granted by busy brokers today. Lack of recognition and appreciation for agents’ successes creates discord and that leads to them looking around.” – Jorge, Texas
Increased productivity– “Good agents would rather brag on their 1099 than their split. Agents need brokerages that make them more productive so they can maximize their earnings. Provide agents with tactical resources, ongoing training and coaching and be available to support them throughout every step of their transactions. A brokers’ #1 goal should be to help them win more listings and close more business.”– Rick Ellis (yes, I am a broker)
Not only are brokers across the country seeing key agents leave, but entire top-producing teams are jumping ship to new brokerages. Companies need to re-evaluate how they recruit if they want to scale in the current environment. CAUTION– The recent data on agent productivity indicates your mid-range producers are the most likely targets for recruiting by your competition.
Lisa, the top recruiter with a major brand brokerage says, “Good recruiting is an ongoing process. Building relationships, listening to needs and wants and helping agents solve their problems. It’s rarely a single meeting close.” She adds this advice, “It’s not just calling agents with a polished sales pitch about your firm and commission split. It’s very personal to each agent; they all have different goals, interests and frustrations. My role is to find out what is missing in their current brokerage and in their world and learn what is important to them so that we can impact their lives.”
She said today agents are moving to value. Companies that provide more value to their agents stand out from the competition.
Recruiting is production insurance and the lifeblood of your brokerage.
Better recruiting based on your valueproposition is much more effective and profitable than simply matching your competitor’s splits. Agents will go where they will get listings — real estate is an inventory-based business and inventory creates stability for everyone.
Your recruiting is easier when your agents have the resources to win at the kitchen table by getting more listings and closing more transactions. Good recruiting of the right agents increases agent retention because producers want to be on the winning team.
Corcoran and HM Properties expand in the Carolinas
There has been much celebration in Charlotte as Corcoran has teamed with the region’s premier luxury firm, HM Properties. The 130+ agent firm now known as Corcoran HM Properties has been one of the largest independent luxury firms and it also has the area’s highest luxury selling prices. Founder Valerie Mitchener has teamed with Corcoran to expand its reach throughout the Carolinas. Current expansion discussions are underway including both acquisitions and partner opportunities with local luxury brokers in select markets in North Carolina and South Carolina. Read more: https://www.prnewswire.com/news-releases/corcoran-arrives-in-north-carolina-with-corcoran-hm-properties-the-firms-newest-affiliate-301317480.html
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Corcoran is growing and we’re looking for a few good firms to grow with. Click here to learn about the Corcoran Network.
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