This article is part of a larger series on How to Become a Real Estate Agent.
To build a successful all-star real estate team, you need to be able to see your future team members’ skills beyond initial appearances or assumptions. However, before you post your first job ad or make your first hire, there are a few steps you should take to ensure you are ready to be a team leader who can motivate, educate, and innovate.
1. Be Honest With Yourself
The first step to setting a good foundation for building a team is honesty. This means being honest with yourself as well as with others. You need to look introspectively at your own qualities and assets before you can bring out the best in those who work for you. This is why you should ask yourself a few questions before making that first hire:
- Are you a team player?
- Can you put aside your ego and motivate those around you?
- Are you a good listener? Are you a good task delegator? Do you micromanage situations after you have given clear instructions?
- Will you allow those around you to rise to the occasion, even if it means they need to struggle a little?
- Will you listen to the ideas and opinions of others before doing it your way?
- Will you put other people’s needs before yours?
If you can answer yes to all of the above questions, then you are ready to embark on the journey of building a rock star real estate team. If you answer no to any of the above questions, then you truly need to look in the mirror at yourself and acknowledge that you may be better off working independently as a real estate broker.
Even though I was able to answer yes to the above stated questions, I found that I wanted the success more than some of my real estate agent team players. There is a good possibility that until you start a team and select your players, you still may not be successful with your first choices. It could take a while to find the right players to come together to form a successful and thriving team.
2. Determine the Role You’re Willing & Able to Play
Being a team leader, you must wear several hats. You need to be ready to step into any position at any time as if you were the head cook and bottle washer. You also must be able to multitask, switch gears, problem-solve, motivate, listen, be patient, innovate, and be tough and soft—sometimes at the same time.
However, the best team leaders recognize that they have weaknesses as well as strengths, and staff accordingly. I have always been a believer of the philosophy to surround yourself with people who are smarter and have more talent than me. When you surround yourself with success, you will be successful.
This is why the best strategy for building a high-performing team is to hire those experienced in business practices that you don’t possess or for job tasks you are ill-equipped to perform. This strategy is also not limited to real estate agent or licensed agents, either. For example, you may determine you need an operations manager to monitor day-to-day business dealings or a marketing specialist.
3. Review Your Business & Budget
Before you can create a team, you’ll also need to review the business plan and budget you presently have in place to support the roles you need. When doing this step, you need to recognize that you will be sharing the income produced with your team. This, of course, will affect how current bills will be covered.
I say this because your financial plan up until this point was likely based on showing buyers property and listing sellers’ homes, getting them into escrow, and enjoying a larger split of the commission depending on broker arrangement. However, adding a buyer’s agent, a showing agent, and a listing agent or assistant will mean the commission pie needs to be divided.
As a result, you need to be aware that the existence of a team will reduce the present income you are accustomed to on a per-transaction basis. This means that initially, you could find yourself making less money. That said, future income will be based on volume, whereby the reduction in individual income will hopefully be balanced by the additional income the team makes.
There are also additional expenses involved when you create a team. You will likely need larger office space and furniture as well as additional office supplies, and incur greater expenses related to marketing, advertising, and overall sales. I equate setting a budget for starting a team similar to a kitchen remodel. You may anticipate a specific dollar amount to cover the remodel, but you need to make sure to possibly double or cushion that figure to anticipate the unexpected.
For more information what it will take to make your team successful from a financial and legal perspective, check out our article on how to start a real estate brokerage.
4. Establish Systems for Success
A very important tool to have in place when creating a high-performing team is an individual contract between the agent and the team leader outlining their job description and compensation. People feel empowered to succeed and make independent decisions when there is no ambiguity as to what is expected. As a result, it is paramount that all parties know the role each of them play, with no crossover or blurred lines.
In particular, your plan should specifically address the following:
Lead Generation & Follow-up Expectations
As the leader, you need to determine how you will handle leads. Do you expect the agents on your team to prospect and generate their own leads, or will you supply a portion of exclusive leads to them using a paid lead generation system like BoldLeads? What are the expectations related to lead follow-up? A team works in unison when everyone knows what building blocks are needed to support a foundation.
You can also learn about other tools that might help your team generate and manage leads in our article on the best real estate lead generation companies.
A real estate business is built on its transactions. Therefore, you also need to define the transaction process. For example, once an escrow opens on a home, will your buyer’s agent handle their own file or use a transaction coordinator? All agents on the team, including the listing specialist, must have knowledge of how to process a file from opening to the closing of a transaction before moving a new file to a transaction coordinator.
It is critically important that your plan be clear on how each agent will be paid when closing a transaction. The terms of compensation between parties needs to be concise, understood, and agreed upon prior to signing any contract.
When discussing compensation, it is important for the agent to know how commission splits are structured. You, as the team leader, need to share how your present split may be arranged with the broker. Many agents come on to a team thinking the team leader is “making bank,” when in reality there are many hands in their pockets, reducing their income.
As a team leader, you also need to have a system or plan in place to refer to in the event a team member leaves. Your team needs to know how an agent’s database will be handled before they leave. Please set precedent upfront as to who has the rights to certain clients. One way to get around this issue is to supply your team with a client database tool, like Propertybase, which is designed for scaling teams instead of asking them to create their own system of recordkeeping.
5. Hire Real Estate Team Members
Once you have a plan for what systems you will have in place as well as how you will pay for your team members, you can finally start building a team that accommodates your needs. The beauty of this step is you have the ability to create new roles or tailor job descriptions based on your business model. However, here is a breakdown of some of the more common roles on a real estate team and what to look for when hiring:
Buyer’s Agent or Buyer’s Specialist
In 1999, at the start of my real estate career, I was fortunate to be hired by a seasoned listing agent to be his buyer’s agent. The role of a buyer’s agent or buyer specialist is to assess the needs or wish list of a potential buyer and find them a property. The buyer’s agent completes a comprehensive buyer questionnaire and also coordinates the lender approval process to determine the sales price of the home the buyer can purchase.
As a buyer’s agent, you get the pleasure of really getting to know the buyers through the process. You will be able to build a long-term relationship and possibly a friend and client for life. During the homebuying process, you also can demonstrate your skills that include helping the buyer secure their loan, directing the buyer during inspections and disclosure review, and most importantly, celebrating the closing of the home. Demonstrating your care, concern, and knowledge during the transaction will solidify the opportunity for future referrals.
When hiring a buyer’s agent, you want to look for the agent “who’s got the hustle.” This agent needs to demonstrate that they are ready, willing, and able to accept any task or potential client you give them. The agent needs to be present and available when a client needs to be taken care of. One must demonstrate the desire to want to work right out of the gate. If the agent does not have these qualities, you need to cut bait, let them go, and find a new candidate.
When having the opportunity to show buyers homes, there are a lot of moving parts whereby a showing assistant could be quite beneficial. A showing assistant can set appointments for showings, review the buyer’s criteria and match it with potential listings, send emails and texts, and return calls to the client. It is always best to have a licensed showing assistant since they would also have the opportunity to show property, hold open houses, and discuss the price of a property if requested. If the showing assistant is unlicensed, they are not allowed to quote pricing, show homes, or hold open houses.
Please be aware that many licensed showing assistants naturally become licensed agents who may want to become a buyer’s agent in order to advance and produce more income.
Listing Agent or Listing Specialist
When a real estate agent becomes a listing agent or listing specialist, it is most important for that agent to have a good concept of different neighborhoods, various floor plans, the features of a home that will help it sell, a great understanding of the workflow and steps in listing a home (from going on the market to the closing of escrow), how to explain the math calculations of the sale and what the seller’s proceeds could be.
As previously pointed out, when starting as a buyer’s agent, many of these traits are learned through the buying process. You will have the opportunity to learn the process “on the street” and not in a book. Hands-on training is always the best.
The listing agent also needs to possess skills that include care and concern, listening, navigating and understanding the contracts and disclosures, calculating a proceeds seller’s net sheet, and great negotiating skills when reviewing an offer.
It is so important when your seller’s home closes that you continue to stay in touch with that client. Whether or not the seller stays in the area or moves out of state, please consider adding that client to your database and stay in touch. Remember that the seller may have relocated to another town or state, but the seller may still stay in touch with the friends they previously lived near. Continue to ask and look for referral opportunities.
A listing assistant will assist the listing agent when posting property listings, filing, answering the phones, and helping with the property closings. The listing assistant could also have the opportunity to prepare the listing documents, coordinate repairs or services at the listing, and monitor the showings of the home to request feedback from the showing agents.
Once again, it is important to recognize that a licensed listing assistant will be able to assist more by addressing pricing and opening the property if needed.
One of the most important people to have on your team is someone who can keep all the paperwork of an escrow organized and processed. This dynamic individual, who juggles so many tasks during an escrow, is a transaction coordinator. Many transaction coordinators are handling multiple files for multiple agents. The talent it takes to switch gears from one file to another is impressive. With modern technology, the transaction coordinator is handling a paperless file that is easily accessible by all parties inside and outside of the office. Many agents like myself use a cloud-based system called Dropbox so as to be able to access a file at any time. All parties are kept up to date on the progress of a file if needed at the same time.
A transaction coordinator needs to have the ability to work with multiple agents who may have many different personalities and work styles. Timelines are crucial when documents need to be signed as soon as possible and disclosures and contracts need to be processed immediately.
Your transaction coordinator is worth every penny you pay them. You need to stay in timely contact with your coordinator. It is most efficient if you touch base with your coordinator every morning to review the day’s files and to answer any questions they may have. It is important for you to return calls, texts, and emails to your coordinator so that they can continue to move an escrow along.
Another suggestion is to generously treat your coordinator and make them feel special. Small tokens of appreciation and recognition will keep them motivated to continue to do a great job.
To be able to have all of these systems work well together, you need an operations manager who can see the whole picture of how each intricate part plays a role in successfully running the real estate team. The operations manager needs great organizational skills, motivational skills, negotiating skills, and superior communication skills. When systems are created, the operations manager is responsible for the success of implementing those systems.
When you have created a rock star real estate team, you want everyone to know about it. The marketing specialist is the individual who makes “the magic happen.” They are responsible for creating campaigns to market a listing from the time it is listed on the market until it closes escrow. When you have created a great listing campaign, you also create a great opportunity for buyers to be interested in those listings. When buyers are interested in the listings, the buyer’s agent or buyer specialist and showing assistants keep working.
The marketing specialist is also responsible to keep present and previous clients “top of mind” so that the buyer’s agent or listing agent will be that client’s real estate agent for life.
A well-rounded marketing specialist will be the most successful. The specialist should also have extensive knowledge in social media so as not to miss any forms of media for reaching out to future business.
There is a wonderful proverb that states, “It takes a village to raise a child.” I believe it takes the individuals listed above to create a rock star real estate team. Once everyone’s strengths are recognized—as well as what role on the team brings out the best qualities of the individual—are in place, a rock star real estate team will be created.